2023 (5) TMI 989 - AT - Customs

Dropping of all proceedings initiated under Regulation 22 of the CHALR-2004 against the CHA M/s Gee Pee International, holder of CHA licence (revocation of CB license reversed) - Department s essential contention is that CHA s action, instead of associating with the Customs Authorities appeared to have done just opposite by resorting to suppression - HELD THAT - The present appeal is a clear case of appalling apathy on the part of department in initiating a frivolous litigation when from para 15(iii) of Statement of Facts of their appeal no wrong doing appear to be forthcoming on the part of the CHA - whatever be the allegation regarding mis-declared value of imports, these is not a shred of evidence to impute the CHA, with this alleged imputation of misdeclaration and ascribe the onus on him. Also it is observed from the order passed by the LD. Commissioner that as far as knowledge on the part of the CHA about the code words and access to purchase registrar of Ma Vabatarini Enterprises, was concerned, it does not come out that the CHA was well aware of and had prior knowledge of the code words/numbers and wholesale market price mentioned in the purchase register of Kolkata based trader - Moreover, the appellants had no access to the Purchase Register of M/s Ma Vabatarini Enterprises. It is seen from the records, that it is categorically stated in the concerned papers that CHA had no role to play in price negotiations between the importers and Shri Dipak Das. The CHA is stated to have a limited role that of arranging the delivery of goods from the Customs area (bonded warehouse) and make arrangements for physical delivery in the presence of the officer of the department. The CHA appellants, merely filed the various bales of entry on the basis of invoices received from the importers and that there is no finding that such invoices received from overseas supplier were fake or fabricated. In short, there is nothing to impute any suppression or mis-statement on the part of the CHA. The entire case of the department is no better than a figment of imagination, based on presumption and attributing knowledge on part of CHA, without any material to support the same. Each case has to be looked at into its own facts and merits and the fact of cancellation of licence of some other CHA placed in similar circumstances cannot be any justification to mete out a similar treatment to another CHA. The department has not been able to demonstrate possession of knowledge of code words or that of the alleged misdeclaration of value on part of the appellant. There is nothing to establish that the CHA failed in suitably advising his clients or to report any non-compliance (of which obviously he ought to have knowledge) to the department s notice or that the appellant failed in discharge of his duties with efficiency and alacrity. The appeal filed by the department fails miserably and is therefore dismissed.

Summary

Issues involved: Appeal against dropping of proceedings under Regulation 22 of CHALR-2004 by Ld. Commissioner, alleging involvement in delivering consignments of "worn clothing" to a trader, charging CHA with suppression of identity and under-valuation.

Facts of the case:
- DRT examined consignments of "worn clothing" involving CHA, M/s Continental Clearing Agency, and M/s Suman International.
- Revenue alleges CHA was involved in suppression and misdeclaration of goods' identity and value.
- Charges under Section 112(a) of the Customs Act and Regulations 13(d), 13(n), and 20 of CHALR-2004.
- CHA issued notice for license revocation and deposit forfeiture for non-compliance with regulations.
- Inquiry Officer found lack of knowledge on CHA's part regarding "code words" and wholesale prices, no evidence of misdeclaration.
- Department failed to produce evidence of CHA's involvement in misdeclaration or suppression.
- Department's appeal deemed frivolous and lacking substance.

Decision and Analysis:
- Inquiry Officer's report found insufficient evidence against CHA for violating CHALR provisions.
- Lack of evidence to attribute misdeclaration to CHA, no proof of knowledge of alleged wrongdoing.
- CHA's limited role in facilitating goods delivery, no involvement in price negotiations or fabrication of invoices.
- Tribunal and High Court rejected proposed value loading based on Purchase Register.
- Department's appeal baseless, lacking factual support, and relying on presumption.
- Each case must be assessed on its own merits, cancellation of another CHA's license not a justification.
- Department failed to demonstrate CHA's knowledge of "code words" or misdeclaration, inefficiency, or non-compliance.
- Appeal dismissed due to lack of substantiated evidence against CHA.

Conclusion:
The appeal against dropping proceedings under Regulation 22 of CHALR-2004 was dismissed, highlighting the department's failure to provide concrete evidence of the CHA's involvement in misdeclaration or suppression. The decision emphasized the importance of factual support in legal proceedings and the need to assess each case based on its unique circumstances.