9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (12) TMI 248 - AT - CustomsImposition of penalty u/s 112 (d) and 114AA of the Customs Act, 1962 on Customs Broker - appellant was only a Customs Broker and not the importer - the only allegation levelled against the appellant is that the appellant did not inform the Revenue that the importer did not possess licence for import of R-22 gas - HELD THAT - A conjoint reading of provisions of section 112 and section 114AA, makes it clear that there should be an intentional or deliberate act or omission and even the motive is attributable to the act of abetment to do any act or omit to do any act. Hence, the requirement of mens rea becomes sine qua non for imposing penalty on the Customs Broker. Admittedly, the appellant being the Customs Broker has been fastened with the penalties on the ground that its activities amounted to abetment. Also abet or abetment is not defined in the Customs Act. In the Order-in-Original, the Adjudicating Authority has inter alia confirmed the allegations with regard to non-presentation of the imported goods for examination and that the appellant had not informed the Customs Authorities about the non-possessing of licence by the importer for importing the R-22 gas while processing the amended Bill-of-Entry. It is also a fact borne on record contrary to the above findings that the cargo was under detention from 01.04.2016 onwards and hence, there was nothing that the appellant being the Customs Broker was able to present. These allegations per se are not sufficient to fasten with the penalty of the nature impugned. The appellant has performed its duties as per the CBLR in terms of the licence granted to it. A perusal of the impugned Order-in-Appeal makes it evident that the appellant did advise the importer as to the requirement of import licence, which appears to be a sufficient compliance insofar as Regulation 11 (d) is concerned because, getting the required licence was, in any case, the duty of the importer. Further, from a bare reading of Section 114AA it is evident that the said Section could be invoked only on the establishment of the fact that the declaration, statement or document made/submitted in transaction of any business for the purposes of the act is false or incorrect and therefore, without establishing that such declaration, statement or document was false or incorrect in any material particular, this Section cannot be invoked. Revenue has not been able to establish the mala fides which is the quintessence of Sections 112 (a) and 114AA ibid. and therefore, the impugned penalties are required to be deleted - Appeal allowed - decided in favor of appellant.
Issues Involved:
1. Justification of penalty imposition under Sections 112(d) and 114AA of the Customs Act, 1962 on the appellant, a Customs Broker, and not the importer. Detailed Analysis: Issue 1: Justification of Penalty Imposition under Sections 112(d) and 114AA of the Customs Act, 1962 on the Appellant, a Customs Broker, and not the Importer Contentions of the Appellant: - The appellant's counsel argued that the Show Cause Notice dated 06.06.2017 issued under Sections 28 and 124 of the Customs Act, 1962, was primarily directed at the importer, with a copy marked to the appellant. - The sole allegation against the appellant was the failure to inform the Revenue that the importer lacked a licence for importing R-22 gas. - The appellant submitted a request letter dated 21.04.2016 to amend the Bill-of-Entry to include Chlorodifluoromethane (R-22 Gas) and did not present the imported goods for examination. - The appellant was accused of abetting smuggling and failing to ensure compliance with Regulations 11(d) and 11(n) of the Customs Broker Licensing Regulations, 2013 (CBLR). - The Revenue did not provide evidence of prior knowledge or collusion by the appellant in the import of R-22 gas. - The appellant’s counsel cited the case of Commissioner of Cus. (Exports), Chennai Vs. I. Sahaya Edin Prabhu to support their argument. Contentions of the Respondent: - The Departmental Representative argued that the Bill-of-Entry lacked sufficient details and that the appellant sought to amend it to include R-22 gas without verifying if the importer had the required licence. - This constituted a serious lapse under Regulations 11(d) and 11(n) of the CBLR, justifying the penalty. Judgment Analysis: - The tribunal noted that Sections 112(a) and 114AA of the Customs Act require an intentional or deliberate act or omission, making mens rea a sine qua non for imposing penalties. - The appellant, being a Customs Broker, was penalized on the grounds of abetment, although 'abet' or 'abetment' is not defined in the Customs Act. - The tribunal found that the findings of the Adjudicating Authority and the Commissioner (Appeals) were mere reiterations of the allegations in the Show Cause Notice. - The tribunal emphasized that the appellant did not handle the clearance with any mala fide motive or for abnormal gain, nor was there any evidence of the appellant making abnormal profit in connivance. - The tribunal referred to the decision in Commissioner of Customs Vs. Shiva Khurana, which stated that a Customs Broker's duty is to verify the Importer Exporter Code (IEC) and the identity of the importer/exporter, not to investigate the veracity of their statements. - The tribunal highlighted that the Revenue failed to establish that the appellant had knowledge or reason to believe that the goods were liable for confiscation, a requirement for penalties under the Customs Act. - The tribunal also referred to the decision in M/s. Sameer Santosh Kumar Jaiswal Vs. Commr. of Cus. (Import-II), Mumbai, which emphasized that Section 114AA requires proof that a person knowingly made a false declaration or document. - The tribunal concluded that the Revenue did not establish the appellant's mala fides, which is essential for penalties under Sections 112(a) and 114AA. Conclusion: - The tribunal set aside the penalties imposed on the appellant, stating that the Revenue failed to prove the appellant's mala fides. - The appeal was allowed, and the penalties were deleted. Order Pronouncement: - The order was pronounced in the open court on 05.12.2019, setting aside the penalties and allowing the appeal.
|
