2014 (9) TMI 403 - AT - Customs

Sub-letting their CHA licence without any authority of law - proof - held that - Although in the statement recorded by DRI, the appellant has admitted that they have given the CHA licence to these persons to use on certain consideration but during the course of enquiry these persons were never called for interrogation or for cross-examination. With regard to the statement of the appellant, the persons who were involved in the activity no other evidence is brought on record therefore, the charge is not proved. Without any other evidence on record that the appellant has sub-let their CHA licence to these 27 persons cannot be proved. - the Charge under Regulation 12 stands not proved. With regard to Regulation 13 (b) we find that no documents are available on record that these 27 persons have dealt with in clearance of imported goods in the name of the appellant. - the Charge under Regulation 13(b) also stands not proved. As charges under Regulations 13 (d) and (e) are consequential to Charges under Regulations 12 and 13(b) therefore, the Charges under Regulations 13 (d) and (e) are also stands not proved. As all the charges are stands not proved - order revoking the CHA licence No. 11/427 and forfeiture of security deposit set aside with immediate effect - Decided in favor of CHA.

Summary

Issues involved:
Appeal against revocation of CHA Licence No. 11/427 based on alleged subletting of license without authority under CHALR, 2004.

Analysis:

Issue 1: Alleged Subletting of CHA Licence
The appellant was accused of subletting their CHA licence to 27 individuals without lawful authorization. The Directorate of Revenue Intelligence (DRI) initiated proceedings based on charges under Regulations 12 and 13 (b) of CHALR, 2004. The Inquiry Officer's report initially found the charges not proven, but a disagreement memo led to further proceedings. The Commissioner of Customs revoked the CHA license and forfeited the security deposit. The appellant contended that the statements against them were unreliable as some were unsigned and retracted. They argued that the individuals were marketing agents, not subletters, supported by the CHA Section report. The Tribunal found lack of evidence to prove subletting, leading to setting aside of the revocation order.

Issue 2: Failure to Prove Charges under Regulations 13 (b)
The Revenue failed to provide evidence that the 27 individuals were not employees and did not handle consignments for clearance, as alleged under Regulation 13 (b). The appellant highlighted inconsistencies in the proceedings related to Customs Act violations, where charges were dropped or proceedings remained inconclusive. The Tribunal ruled in favor of the appellant, stating that the charges under Regulation 13 (b) were not substantiated due to lack of evidence.

Issue 3: Consequential Charges under Regulations 13 (d) and (e)
Since the charges under Regulations 13 (d) and (e) were linked to the unsubstantiated charges under Regulations 12 and 13 (b), the Tribunal found them also not proven. As a result, the impugned order revoking the CHA license and forfeiting the security deposit was set aside, providing the appellant with consequential relief.

The Tribunal's decision was based on the lack of concrete evidence supporting the allegations of subletting and non-compliance with CHALR, 2004 regulations. The judgment emphasized the importance of reliable evidence and adherence to procedural requirements in such cases.