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2019 (12) TMI 529 - AT - CustomsRevocation of CB / CHA License - forfeiture of security deposit - mis-declaration of imported goods - alleged violation of Regulation No. 11(a) (d) (e) (f) and (l) of CBLR 2013 - HELD THAT - There is no independent appreciation of the facts neither appreciation of the conduct of the appellant CB over the last several years. The impugned order is more or less repetition of the show cause notice. The learned Commissioner failed to appreciate that in the facts and circumstances the appellant have no role in obtaining IEC of M/s Apollo Enterprises or misdeclaration of the goods. The appellant was under bonafide belief that the importer is genuine and goods were declared as per the import documents. Hence the revocation of the CB licence without any serious fault on their part is not warranted and wrong - Further it is evident from the statement recorded of Shri Samir Shah Shri Ashok Purohit and Shri Shantaram Kajrekar that the appellant was not aware about the illicit procurement and use of the IEC of M/s Apollo Enterprises by Shri Ashok Purohit. Thus the impugned order holding violation of provisions of Regulation 11(a) 11(d) 11(e) 11(f) and 11(n) of CBLR 2013 is perverse and none of these provisions are attracted in the facts and circumstances of the case. There is no allegation of filing the bill of entry knowingly the same to be misdeclared. There is no case of connivance of the appellant CHA with the actual importer of the goods namely Shri Ashok Purohit. There is no allegation by the Revenue that the appellant CHA received any extra remuneration than the normal remuneration for filing the bill of entry under dispute. The appellant CB /CHA have erred in not receiving the KYC documents directly from the hands of the IEC holder - Shri Shantaram Kajrekar. Further as the documents were received through Shri Samir Shah relative of partner there was an element of trust. Thus there is some element of inadvertance on the part of the appellant-CHA. There is no case of malafidely filing the bill of entry under collusion and /or connivance with the said Shri Ashok Purohit or Shri Samir Shah. In this view of the matter the punishment of revocation is too harsh and disproportionate. Accordingly this appeal in part and the order of revocation is set aside - So far as the forfeiture of security deposit is concerned the same is reduced to 1, 00, 000/- - appeal llowed inpart.
Issues Involved:
1. Revocation of CHA License and Forfeiture of Security Deposit 2. Alleged Misdeclaration and Under-valuation of Imported Goods 3. Violation of Customs Broker Licensing Regulations (CBLR), 2013 4. Due Diligence and KYC Verification by Customs Broker 5. Proportionality of Penalty Imposed Issue-wise Detailed Analysis: 1. Revocation of CHA License and Forfeiture of Security Deposit: The appellant, M/s Tanmay Global Logistics, a CHA firm, appealed against the revocation of their CHA license and the forfeiture of a ?5 lakh security deposit. The Commissioner of Customs revoked the license based on allegations of involvement in customs duty evasion and failure to comply with CBLR, 2013. The Tribunal found the punishment of revocation too harsh and disproportionate, reducing the forfeiture to ?1 lakh and directing the restoration of the CHA license. 2. Alleged Misdeclaration and Under-valuation of Imported Goods: The Revenue alleged that parts of branded LED TVs were imported under the guise of unbranded parts with misdeclared values. The investigation revealed that the actual values were significantly higher than those declared. The goods were seized under Section 111 of the Customs Act for misdeclaration. Shri Ashok Purohit admitted to misdeclaration and voluntarily paid differential duty. 3. Violation of Customs Broker Licensing Regulations (CBLR), 2013: The appellant was accused of violating Regulations 11(a), (d), (e), (f), and (n) of CBLR, 2013. The violations included failure to obtain proper authorization, not advising clients to comply with customs laws, lack of due diligence in verifying client information, and not verifying the correctness of the IEC code and client identity. The Enquiry Officer found these allegations to be proven. 4. Due Diligence and KYC Verification by Customs Broker: The appellant argued that they had obtained all necessary documents and verified the address online, thus exercising due diligence. However, they admitted to lapses in not directly verifying the KYC documents from the IEC holder. The Tribunal noted that the documents were received through a relative, indicating an element of trust and inadvertence rather than malafide intent. 5. Proportionality of Penalty Imposed: The Tribunal considered the past good conduct of the appellant and the lack of any previous penalties. The Tribunal found no evidence of connivance or extra remuneration received by the appellant. The revocation of the license was deemed too severe, especially given the inadvertent nature of the lapse. The Tribunal reduced the forfeiture to ?1 lakh and ordered the restoration of the CHA license. Conclusion: The Tribunal allowed the appeal in part, setting aside the order of revocation and reducing the forfeiture of the security deposit to ?1 lakh. The Commissioner was directed to restore the CHA license within a week of the deposit. The period of revocation was to be extended for the duration the license remained revoked. The appeal was thus allowed in part.
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