2017 (4) TMI 601 - AT - Customs

Imposition of penalty on CHA - the classification of the goods declared in the said Bill of Entry as also the value was not correct - Held that - the fact stated is of mis-declaration of classification as also valuation by the main importer, M/s. Maya Overseas and there is no evidence to show that the CHA knew about the in correct classification and valuation of the Goods - the CHA declared the goods in the Bills of Entry based upon the information given to him by the importer and is not expected to investigate and find out the correct classification or value of the goods - penalty imposed on CHA not justified - appeal allowed - decided in favor of appellant-CHA.

Summary

Issues: Imposition of penalty on a Customs House Agent (CHA) for incorrect classification and valuation of goods in a Bill of Entry.

In this case, the Appellate Tribunal CESTAT NEW DELHI addressed the challenge to the imposition of a penalty of ?25,000 on a CHA. The investigation by the DRI revealed that the goods' classification and value declared in a Bill of Entry by the CHA's G-card holder were incorrect. Subsequently, proceedings were initiated against the importer and the CHA, resulting in a penalty of ?5 lakhs on the CHA. The Commissioner (Appeals) later reduced the penalty to ?25,000, noting that the CHA's role did not warrant such a high penalty.

The Tribunal reviewed the Order-in-Original and found that the adjudicating authority had not provided any evidence to demonstrate that the CHA was aware of the incorrect classification and valuation of the goods. The CHA had relied on information provided by the importer and was not obligated to investigate the goods' correct classification or value. Therefore, the Tribunal concluded that there was no basis to impose a penalty on the CHA. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellant CHA, providing consequential relief.