2017 (7) TMI 1160 - AT - Customs

Penalty on CHA u/s 112 (a) and 112 (b) of the CA 1962 - it was alleged that the appellant was involved in the offense - Held that - The appellant cannot shirk its responsibility in respect of offence committed by M/s JVL - the imposition of penalty on the appellant is justified - appeal dismissed.

Summary

Issues: Imposition of penalty on a Custom House Agent under Section 112 (a) and 112 (b) of the Customs Act, 1962 for involvement in diversion of imported goods on high sea sale basis.

Analysis:
1. The appellant, a Custom House Agent, filed an appeal against the penalty imposed under Section 112 (a) and 112 (b) of the Customs Act, 1962. The case involved the import of goods declared as Crude Palm Oil, which were diverted in violation of exemption Notification conditions by M/s JVL to M/s Asha Soap Factory. The Settlement Commission settled the matter with M/s JVL and its directors, but the Commissioner of Customs (Port) decided the case for other co-noticees, including the appellant.

2. The Adjudicating Authority found that the appellant, as a CHA, failed to discharge their responsibility properly in dealing with the subject goods, which were liable for confiscation under Section 111 (m) of the Customs Act, 1962. The Authority held that the CHA was aware of the formalities associated with such goods sold on high seas basis and failed to bring to the notice of the department the illegitimacy of the transfer of title/ownership of the goods by M/s JVL to M/s Asha Soap Factory.

3. The Settlement Commission had already imposed a penalty on M/s JVL, and it was established that the appellant was involved in the offense. Despite citing various case laws in their appeal, the appellant could not evade responsibility for the offense committed by M/s JVL. Therefore, the imposition of penalty on the appellant was deemed justified, and the appeal filed by the appellant was dismissed.

Conclusion:
The judgment upheld the imposition of penalty on the Custom House Agent for their failure to discharge their responsibilities properly in dealing with imported goods diverted in violation of exemption Notification conditions. The decision highlighted the CHA's obligation to ensure compliance with customs regulations and the consequences of failing to fulfill their duties, leading to the dismissal of the appellant's appeal.