2017 (5) TMI 1177 - AT - Customs

Penalty on C&F Agent - they aided and abetted in the evasion of the customs duty - undervaluation of imported clearances - case of appellant is that he is only a clearing and forwarding agent and involved in the clearance of the goods. Therefore, as regards valuation issue, he is not a party to the undervaluation of imported goods - it is also contended by appellant that CHA were involved in the clearing of the goods but those CHAs were not made noticees in the present case - Held that - the appellant is a clearing and forwarding agent but as per their statement they are engaged in the clearing of the goods by using the CHA licence of some other CHA. Therefore, it cannot be said that since the CHA was not penalised the appellants should also be absolved from the penalty - the appellant was actively involved in the clearing of the goods and fact of undervaluation was known to them, therefore they aided and abetted in the evasion of the customs duty, committed by the two exporters namely M/s. Vastupal Tejpal (India) and M/s. Bhaktiprem International - penalty upheld - appeal dismissed - decided against appellant.

Summary

Issues:
1. Imposition of penalty under Section 112 of the Customs Act, 1962 on a clearing and forwarding agent for aiding in undervaluation of imported goods.

Analysis:
The case involved the imposition of a penalty under Section 112 of the Customs Act, 1962 on a clearing and forwarding agent for his involvement in clearing goods through a firm without a CHA license. The appellant, a clearing agent, was found to have aided in undervaluation of imported goods by declaring lesser quantities than the actual amount. The investigation revealed that the appellant was clearing goods on behalf of exporters involved in undervaluation. The Customs duty demand against the exporters was confirmed, and penalties were imposed. The appellant was also penalized &8377; 10 lakhs for acts leading to goods being liable for confiscation under Section 111 of the Customs Act, 1962.

The appellant argued that as a clearing agent, he was not party to the undervaluation of goods and should not be penalized. He contended that the CHAs responsible for clearing the goods were not made noticees in the case. The appellant's counsel cited a Tribunal decision to support his argument. On the other hand, the revenue department reiterated the findings of the impugned order, emphasizing that the appellant, despite being a clearing agent, was involved in clearing goods under another CHA license and knowingly aided in the evasion of customs duty through undervaluation.

The Tribunal, after considering both sides' submissions, upheld the penalty imposed on the appellant. It noted that the appellant, while acting as a clearing agent, was aware of the undervaluation scheme and actively participated in clearing goods with the intent to evade customs duty. The Tribunal rejected the appellant's claim of unawareness regarding undervaluation and concluded that the penalty was justified given the appellant's involvement in aiding and abetting the evasion of customs duty. Therefore, the appeal for waiver of the &8377; 10 lakhs penalty was dismissed, and the impugned order was upheld.

In conclusion, the Tribunal's decision affirmed the penalty imposed on the clearing and forwarding agent for his role in aiding undervaluation of imported goods, emphasizing his active involvement in the evasion of customs duty.