2020 (2) TMI 1362 - HC - Customs

Revocation of Customs Broker License - forfeiture of part or whole of the security - imposition of penalty - It is the contention of the Department that the respondent had attended to customs work on behalf of one of the fraudulent exporters by name M/s. Shakthishka Exports and that the person who actually handled the export one Shri S. Uma Mahesh, a G-Card holder, was investigated by DRI - HELD THAT - A reading of Regulation 18 of the Regulations indicates that the various options/punishments indicated therein are in the alternative and it is not mandatory for the Adjudicating Authority to revoke the licence of a Customs Broker for all infractions of the Regulations. The reason assigned by the Tribunal, i.e., that there was retraction of the statement made by the witness about subletting of the licence by the respondent to him stating that there was duress at the time when the statement was taken from him under Section 108 of the Act, and the officials of the Revenue had not confronted him with the bank transfers to establish that the licence was sublet by the respondent to the said Shri S. Uma Mahesh for consideration, and giving of benefit of doubt to the respondent, cannot be said to be perverse based on no evidence or contrary to law. The Tribunal had rightly exercised its jurisdiction and the punishment imposed on the respondent is proportionate - Appeal dismissed.

Summary

Issues: Challenge to order under Customs Act, 1962; Allegations of subletting broker license; Violation of Customs Brokers Licensing Regulations, 2013; Revocation of license, forfeiture of security, and penalty imposition; Appeal against Tribunal's decision.

The judgment pertains to a challenge under Section 130A(1) of the Customs Act, 1962 against an order dated 26-3-2019 regarding the alleged subletting of a broker license. The respondent, a Customs Broker, faced accusations related to misdeclaration of goods by certain exporters. The Department contended that the respondent facilitated customs work for a fraudulent exporter and sublet the license to another individual. The Department issued a show cause notice under the Customs Brokers Licensing Regulations, 2013, seeking revocation of the license, forfeiture of security, and a penalty. The Adjudicating Authority found the respondent guilty, revoked the license, ordered forfeiture of security, and imposed a penalty.

The respondent challenged this decision before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) at Hyderabad. The respondent denied the allegations, claiming the statement against him was obtained under duress. The Tribunal, in its order dated 26-3-2019, acknowledged the subletting of the license but noted inconsistencies in the witness's statement. It held that the respondent should have been further questioned and confronted with evidence of subletting. The Tribunal gave the benefit of the doubt to the respondent, imposed a penalty of ?50,000, and restored the license while setting aside the forfeiture of the security deposit.

The appellant contested this decision, arguing that the Tribunal erred in revoking the order of the Adjudicating Authority and imposing a lesser penalty. The Tribunal's decision was scrutinized, and it was found that the punishment imposed was proportionate. The Court upheld the Tribunal's decision, stating that the Tribunal had rightly exercised its jurisdiction. Consequently, the appeal was dismissed, and no costs were awarded. Any pending miscellaneous petitions in the case were also dismissed.