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2022 (3) TMI 1003 - AT - CustomsRevocation of Customs Broker/ CHA License - forfeiture of Security Deposit - levy of penalty - Mis declaration of value of export goods - over-valuation of goods - availment of excess drawback in respect of past clearance of similar goods - violation to advise clients to comply with laws and inform Customs in case of non compliance - violation to verify the KYC of the clients using authentic means - conceal records or destroy information - transact business in more than one firm - HELD THAT - In the present case the appellant had deliberately filed 3 shipping bills on 23.11.2018 for import of rubber insulated data cable/data cable for exporter M/s. Elegant exports. The goods were seized in the presence of H card holder of the appellant on the ground of being over valued. The appellant Ms. Bharti Chawla being the proprietor and owner of Online cargo and her statement dated 11.12.1990 had expressed her acknowledgement suggestions with the market inquiry, the way it was conducted and the value at which it arrived at i.e. ₹ 10.67 per piece of data cable - From the statement of the appellant as has been relied upon by the Adjudicating Authority, it is clear that she only acknowledged about verifying of the quantity and quality of the goods. This particular acknowledgement is definitely in furtherance of her duty as has been cast upon under Regulation 10(d). However, this verification does not amounts to the knowledge of the CB about the actual price for the goods and that the goods were overvalued by the exporter. There is nothing on record produced by the department to prove that Customs Broker was already aware of the factum of over valuation of goods by the exporter. Simultaneous apparent fact on record is that the exporter never joined investigation inspite of the summons were repeatedly issued to him which was received back undelivered from the postal authorities. The postal report is sufficient to hold that the exporter was no more existing on the address as was provided by the Customs Broker to the authorities . Not only this it amounts to non verification about the correctness of the ICE /GSTIN number also functioning of Customs Broker office at the declared address. There is nothing on record brought by the appellant to show and prove that there were deliberate efforts on her part to comply with Regulation 10(n) - there is no efforts apparent on record on the part of the appellant to make her client available before the Inquiry Officer. To our opinion, the above observed facts are sufficient violation of Regulation 10(d) and 10(n) of CBLR Regulations 2018. Present is the case not only of the concealment on the part of the Customs broker about the proper value of the goods while filing the shipping bills but is also the case where the appellant had rather tried to change the shipping bills in terminal handling agency, CELBI Delhi, Cargo Management India Ltd. - the appellant unreasonably and illegally supported his clients for filing new shipping bills when the old shipping bills were still existed in the system. With reply to those same goods of old shipping bills which, by then were allowed even for provisional release and were exported against the Shipping Bill No. 1070451, 1070492 and 1070464 all dated 03.01.2019. it is the appellant who facilitated not only the provisional release of the goods but also re-export on 03.01.2019. The plea of the appellant that suspension of her license is disproportionate punishment. It is held that not merely the negligence on the part of the appellant but the concealment of relevant facts as is unjustly enrich his client on the expenses of Government exchequer. Not only this, the appellant is a person already found involved in illegal offence as grave of smuggling narcotics drugs, the revocation of licence of the appellant in view of the duty as has been cased upon the Customs Broker and the way the Customs Broker is appointed is held to be proportionate to the violation committed by the appellant. There are no infirmity in the order under challenge vide which the licence of the appellant has been revoked and the penalty has been imposed upon the appellant - appeal dismissed.
Issues Involved:
1. Violation of Regulation 10(d) of CBLR, 2018. 2. Violation of Regulation 10(n) of CBLR, 2018. 3. Violation of Regulation 10(j) of CBLR, 2018. 4. Violation of Regulation 7(2) of CBLR, 2018. 5. Allegations of overvaluation of export goods and mis-declaration. 6. Penalty and revocation of Customs Broker (CB) license. Detailed Analysis: 1. Violation of Regulation 10(d) of CBLR, 2018: Regulation 10(d) mandates that a Customs Broker (CB) must advise clients to comply with laws and inform Customs in case of non-compliance. The CB was found to have verified the quantity and quality of goods but did not ascertain the correct value of the goods, which were overvalued. Despite acknowledging the market inquiry and the value determined, there was no evidence that the CB knew about the overvaluation. However, the CB failed to bring the non-compliance to the notice of the authorities, thus violating Regulation 10(d). 2. Violation of Regulation 10(n) of CBLR, 2018: Regulation 10(n) requires the CB to verify the correctness of the Importer Exporter Code (IEC), GSTIN, and the functioning of the client at the declared address using reliable, independent, and authentic documents. The CB failed to inform Customs about the change in the exporter’s address, as the exporter did not appear before Customs, and the summons were returned undelivered. This failure to verify and update the client's address constituted a violation of Regulation 10(n). 3. Violation of Regulation 10(j) of CBLR, 2018: Regulation 10(j) prohibits the CB from concealing, removing, or destroying any records related to their transactions. The CB introduced Online Cargo as a Freight Forwarding Concern and concealed that Online Cargo held a CHA License. Additionally, the CB attempted to change shipping bills when the old ones were still in the system, indicating an attempt to conceal relevant transaction details, thus violating Regulation 10(j). 4. Violation of Regulation 7(2) of CBLR, 2018: Regulation 7(2) prohibits a CB from transacting business on behalf of more than one firm. The CB was found to be a managing partner of Johar Enterprises while also applying for a CB License in the name of Online Cargo. This dual engagement was concealed, violating Regulation 7(2). 5. Allegations of Overvaluation of Export Goods and Mis-declaration: The CB was involved in filing shipping bills for overvalued goods, facilitating the exporter to avail excess drawback. Despite the provisional release of goods, the CB’s actions in changing shipping bills and facilitating re-export indicated a deliberate attempt to support the exporter’s fraudulent activities. 6. Penalty and Revocation of Customs Broker License: The CB’s actions, including filing false affidavits, concealing involvement with another firm, and previous involvement in illegal activities (such as smuggling narcotics), justified the revocation of the CB license and imposition of penalties. The Tribunal upheld the Commissioner Customs’ order, finding no infirmity in the decision to revoke the license and impose penalties, considering the severe violations and the CB’s previous misconduct. Conclusion: The Tribunal concluded that the CB’s license revocation and penalties were proportionate to the violations committed. The appeal was dismissed, and the order under challenge was upheld.
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