2018 (2) TMI 1138 - AT - Customs

Penalty under the provisions of Regulation 18 read with Regulation 20(7) and 22 of Customs Broker Licensing Regulations, 2013 - time limitation - Held that - there is no offence report received by the licensing authority prior to the issue of show cause notice by the DRI, which is received on 05.10.2016 - No such report has been received or placed on record prior to the issue of show cause notice by the DRI. As such, we find no breach of limitation of time limit. Scope of SCN - Penalty - Held that - the allegation made against the appellant with reference to connivance with the importer regarding non-adherence of MRP labeling is not established. Similarly, the other serious offences alleged has also found to be not established - Regarding the original authority going beyond the scope of the allegation as contented by appellant, we note that the provisions of Regulation 11 (d) are very generic and a portion of the acts of the appellant was found to be violating such obligation. We find no infirmity in the findings recorded in the original order to the effect that such infringement will attract penal action. Appeal dismissed - decided against appellant.

Issues:
1. Imposition of penalty on a licensed customs broker for violations of Customs Broker Licensing Regulations, 2013.
2. Compliance with time limits prescribed under CBLR.
3. Scope of show cause notice and allegations made therein.

Issue 1: Imposition of Penalty:
The appeal involved a licensed customs broker challenging a penalty imposed by the Commissioner of Customs under Customs Broker Licensing Regulations, 2013. The appellant was penalized for failing to obtain permission for affixing stickers on imported goods and not advising the importer properly. The original authority found the violations not grave enough for license revocation but imposed a penalty of ?50,000. The appellant contested the order on grounds of procedural violations and exceeding the scope of the show cause notice.

Analysis:
The Enquiry Officer recommended penal action against the appellant for failing to comply with Regulation 11(d) of CBLR. The original authority found the appellant in violation of CBLR by not obtaining permission for affixing stickers on imported goods, although the violations were not deemed serious enough for license revocation. The appellant challenged the order citing procedural irregularities and exceeding the scope of the show cause notice. The Tribunal upheld the penalty, stating that the violations fell within the obligations of a customs broker as per Regulation 11(d) and found no jurisdictional error or violation of natural justice principles.

Issue 2: Compliance with Time Limits:
The appellant argued that the proceedings exceeded the 90-day period prescribed under CBLR from the date of the offense report. The appellant contended that the proceedings initiated by the original authority were beyond the scope of the show cause notice, leading to a penalty on different grounds.

Analysis:
The Tribunal examined the time limits for CBLR proceedings and noted that no offense report was received by the licensing authority before the show cause notice was issued. The Tribunal found no breach of the time limit prescribed under CBLR, as the proceedings were initiated following the receipt of the offense report. The appellant's argument regarding the time limit was dismissed, upholding the validity of the proceedings.

Issue 3: Scope of Show Cause Notice:
The appellant contested that the penalty imposed went beyond the scope of the allegations in the show cause notice. The appellant argued that the original authority exceeded the allegations by penalizing for not obtaining permission for affixing stickers on imported goods.

Analysis:
The Tribunal reviewed the show cause notice and the enquiry report, finding that the violations, including the failure to obtain permission for affixing stickers on imported goods, fell within the scope of Regulation 11(d) as alleged. The Tribunal held that the original authority had the competence to decide on all violations under Regulation 11(d) and found no error in the penalty imposed. The Tribunal dismissed the appeal, upholding the original order and finding no grounds for interference.

In conclusion, the Tribunal upheld the penalty imposed on the licensed customs broker for violations of CBLR, dismissed the appeal challenging procedural aspects and the scope of the show cause notice, and found the original order to be legally sound and valid.

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