2018 (9) TMI 766 - AT - Customs

Revocation of CHA License - forfeiture of security deposit - alleged forgery of signature of the Assistant Commissioner of Customs on the duplicate copy of shipping bill no. 11288/21.05.2005 which had, inadvertently, been left blank while approving the shipment - Held that - It would appear that the original and triplicate copies of the shipping bill had been duly approved by the proper officer and that the duplicate copy was not signed. The employee tasked with the completion of documentation formalities had admitted to the forgery of signature owing to the incumbent officer being on leave. That undoubtedly, as found by the Principal Commissioner of Customs, is not tolerable - the conclusion following from the report of the duly constituted inquiry authority that the licencee had failed in supervisory responsibilities is not on the same footing. The lack of any finding in the impugned order that the customs broker was aware, let alone, of conniving in the forgery. In the first round, the licencing authority was not convinced that the supervision was expected to extend to such matters as the licencee was not informed about - the revocation of licence and forfeiture of security deposit has been ordered in the absence of any further evidence recorded in this round that could lead to a different conclusion - it is apparent that the Principal Commissioner of Customs (General) did not appear to have applied his mind to the facts and circumstances, the framework of the chargesheet and the findings of the inquiry authority before proceeding to penalise the appellant. It cannot be overlooked that there was sufficient probability of misconstruing the remand order of the Tribunal. Revocation and forfeiture set aside - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Revocation of customs broker license under Customs Broker Licensing Regulations, 2017.
2. Alleged forgery of signature on shipping bill leading to license revocation.
3. Failure of customs broker to supervise employees.
4. Lack of malafide intention but imposition of penalty based on criminal intent.
5. Lack of knowledge of forgery by customs broker.
6. Appeal against revocation of license.

Analysis:

Issue 1: Revocation of customs broker license under Customs Broker Licensing Regulations, 2017
The judgment revolves around the revocation of a customs broker license by the Principal Commissioner of Customs (General) based on the powers under regulation 18 and 20 of Customs Broker Licensing Regulations, 2017. The license was revoked due to the alleged forgery of a signature on a shipping bill, leading to the forfeiture of the security deposit.

Issue 2: Alleged forgery of signature on shipping bill leading to license revocation
The case involved an incident where an employee of the customs broker firm forged the signature of an Assistant Commissioner of Customs on a shipping bill. The forgery was done to rectify an omission made by the Assistant Commissioner while approving the shipment. Despite acknowledging the lack of malafide intention and no impact on revenue, the Principal Commissioner revoked the license based on the criminal intent.

Issue 3: Failure of customs broker to supervise employees
The judgment highlighted the failure of the customs broker to properly supervise their employees, leading to the forgery incident. The competent authority debarred the employees involved but dropped proceedings against the customs broker with a warning on the license.

Issue 4: Lack of malafide intention but imposition of penalty based on criminal intent
Although there was no evidence of malafide or fraudulent intention on part of the customs broker, the imposition of penalty was based on the criminal intent of the employees involved in the forgery. The judgment emphasized the sensitivity of customs operations and the seriousness of forgery of official signatures.

Issue 5: Lack of knowledge of forgery by customs broker
The customs broker claimed that they had no knowledge of the forgery and had a clean record in their years of operation. The judgment noted that the customs broker was not aware of or involved in the forgery incident and had taken immediate action by removing the errant employees.

Issue 6: Appeal against revocation of license
The Tribunal, upon detailed scrutiny of the facts and circumstances, found that the revocation of the license and forfeiture of the security deposit lacked justification. The judgment highlighted the lack of evidence implicating the customs broker in the forgery and the absence of any unwarranted gain from the act of expediency. The appeal was allowed, setting aside the revocation of the customs broker license and ordering restoration of the license.