2014 (10) TMI 1040 - AT - Customs

Penalty on CHA u/s 114 of CA - exporter was fictitious firm not available at the address given in the shipping bills - control over the G and H Card holders - allegation based on assumptions and presumptions or not - HELD THAT - There are no direct allegations either in the show cause notice or direct finding in the impugned order to conclude that it was the present CHA himself who filed shipping bills. The adjudicating authority has relied upon the sole statement of Shri Rakesh Kumar of M/s. Sky Liner Transhipment - As against the statement of Shri Rakesh Kumar, there is statement of Shri S. Malik, proprietor of present CHA denying having filed the shipping bills. As such, the sole statement of Shri Rakesh Kumar, which is also being faced with the statement of Shri S. Malik without any collaborating evidence, cannot be made basis for penalizing the appellant. The entire case of the Revenue is based upon the assumption and presumption inasmuch as the notice alleges allowing of misuse by the CHA and the impugned order holds him responsible for any misuse or his having no control over the G and H Card holders without coming to a finding who filed the shipping bills. There is no handwriting opinion in respect of signatures appearing on the shipping bills nor their CHA card holder examined by the Revenue. There are no merits in the Revenue s stand of involvement of the present CHA - penalty set aside - appeal allowed - decided in favor of appellant.

Summary

Issues: Imposition of penalty on a Customs House Agent (CHA) under Section 114 of the Customs Act, 1962 for alleged customs violations.

Analysis:
1. Facts of the Case: The appellant, a CHA, was penalized with a fine of Rs. 5 lakhs for a consignment containing different goods than declared in the shipping bills. The exporter was found to be a fictitious firm, and investigations revealed discrepancies in the consignment booked by the appellant.

2. Allegations and Investigations: Statements of individuals associated with the CHA and the forwarding agents were recorded. While some admitted to handling the consignment, the CHA denied involvement in filing the shipping bills or having control over certain card holders. Revenue failed to verify these claims.

3. Initiation of Proceedings: Show cause notice was issued to the CHA, alleging lack of due diligence in preventing misuse of the CHA license. The Commissioner imposed the penalty, holding the CHA responsible for customs violations and lack of supervision over card holders.

4. Appellate Tribunal's Findings: The Tribunal noted the absence of direct evidence linking the CHA to the filing of shipping bills. The reliance on a single statement without corroborating evidence was deemed insufficient for penalization. Lack of control over card holders was mentioned without proof of their involvement in filing shipping bills.

5. Conclusion: The Tribunal found no merit in the Revenue's case against the CHA, as there was no conclusive evidence of his direct involvement in the customs violations. The penalty imposed was set aside, and the appeal was allowed in favor of the CHA.