2013 (11) TMI 34 - AT - Customs

Revocation of CHA Licence - Forfeiture of the security deposit - failure to comply with the provisions of CHALR, 2004 - Export of restricted item - Appellant contends that his signature were forged on shipping bills - Held that - the appellant had knowledge of the forging of the documents and deliberately suppressed the fact to the customs authorities - appellant gave signed blank forms to their Tuticorin Branch without knowing the importer or exporter which would show that the Manager of the CHA of Tuticorin acted under the instruction of the Chennai office. Thus, the CHA firm is responsible for the forgery of documents by their employee. There is gross violation of Regulation 13(a), 13(d), 19(8) and 19(10) of CHALR, 2004 - Following decision of Commissioner of Customs Vs. Worldwide Cargo Movers 2006 (11) TMI 281 - BOMBAY HIGH COURT , Commissioner of Customs Vs. H.B. Cargo Services 2011 (3) TMI 816 - ANDHRA PRADESH HIGH COURT and Sri Kamakshi Agency Vs. Commissioner of Customs 2000 (11) TMI 144 - HIGH COURT OF JUDICATURE AT MADRAS - Decided against CHA.

Summary

Issues Involved:
1. Revocation of CHA Licence and forfeiture of security deposit under Regulation 20 of CHALR, 2004.
2. Allegations of forgery and misconduct by the appellant's employee.
3. Compliance with CHALR, 2004 regulations.
4. Proportionality of punishment imposed.
5. Applicability of case laws cited by both parties.

Issue-wise Detailed Analysis:

1. Revocation of CHA Licence and Forfeiture of Security Deposit under Regulation 20 of CHALR, 2004:
The appellant, a Customs House Clearing Agent (CHA), appealed against the revocation of their CHA Licence and forfeiture of the security deposit of Rs. 75,000/- under Regulation 20 of CHALR, 2004. The Commissioner of Customs, Trichy, had issued the licence, and the appellant had been providing CHA services since 2003. The revocation was based on allegations of gross misconduct, negligence, and recklessness, as detailed in the show-cause notice dated 1.1.2010.

2. Allegations of Forgery and Misconduct by the Appellant's Employee:
The appellant's Manager at the Tuticorin Branch Office, Shri C.T. Jagan, admitted to forging signatures on customs documents and filing Shipping Bills without the knowledge of the Chennai Office. The DRI officers intercepted a consignment on 27.2.2009, revealing that Ketamine Hydrochloride, a restricted chemical, was concealed in stainless steel utensils meant for export. The appellant lodged an FIR against the Manager, claiming no prior knowledge of the forgery.

3. Compliance with CHALR, 2004 Regulations:
The appellant admitted to sending signed blank Annexure - A / Appendix forms to their Tuticorin Branch Office, which was deemed an irregular practice. The Tribunal found that the appellant was aware of the forgery by the end of January 2009 but only obtained an admission letter from the Manager on 26.2.2009, a day before the DRI interception. This delay indicated that the appellant had knowledge of the forgery and deliberately suppressed the fact from customs authorities. The appellant's actions were found to be in gross violation of Regulation 13(a), 13(d), 19(8), and 19(10) of CHALR, 2004.

4. Proportionality of Punishment Imposed:
The Tribunal considered the proportionality of the punishment and referenced several case laws to support the decision. In the case of Worldwide Cargo Movers, the Bombay High Court emphasized the importance of maintaining discipline in the customs area and upheld the revocation of the CHA licence. Similarly, the Andhra Pradesh High Court in H.B. Cargo Services highlighted that a single act of corruption could warrant the maximum penalty of licence revocation. The Madras High Court in Sri Kamakshi Agency also supported revocation when the CHA's actions resulted in significant revenue loss.

5. Applicability of Case Laws Cited by Both Parties:
The appellant cited the case of Falcon Air Cargo and Travels, where the Delhi High Court considered the right to carry on trade or profession under Article 19(1)(g) of the Constitution of India. However, the Tribunal found this case inapplicable as the Supreme Court had remanded the matter to the Tribunal for a decision in accordance with the law. The Tribunal concluded that the penal proceedings under the Customs Act, 1962, did not bind actions taken under CHALR, 2004, which is a self-contained and independent regulation.

Conclusion:
The Tribunal rejected the appeal, finding no reason to interfere with the Commissioner's order. The revocation of the CHA licence and forfeiture of the security deposit were upheld, following due process and full compliance with the procedures outlined in Regulation 22 of CHALR, 2004. The Tribunal's decision emphasized the importance of maintaining integrity and discipline in customs operations, holding the appellant responsible for the misconduct of their employee.