2023 (7) TMI 595 - AT - Customs

Levy of maximum penalty under Regulation 18 of CBLR - Customs Broker License was not revoked - unilateral and illegal untested version of CBI - SCN relies only upon alleged self-contained note of CBI - no relevant documents supplied to appellant - violation of principles of natural justice - HELD THAT - The learned Adjudicating Authority concludes with all the force of argument that the Custom broker (the appellant) has violated the provisions of Rule 10(i) and Rule 13 (12) of CBLR, 2018. However, the Adjudicating Authority does not deem it fit to revoke the license of the appellant. The Adjudicating Authority finds that the revocation of license is not warranted in the present case. However, it is not explained as to how the learned Adjudicating Authority has come to such a conclusion though holding that the appellants have rendered themselves liable to pay maximum penalty as applicable under Rule 18 of CBLR, 2018. Understandably, the evidence made available to the Adjudicating Authority in the instant case is not of a kind to be a proof beyond doubt; set of evidence available before the Adjudicating Authority was a report by the CBI, which itself at best, offers scope for conducting further enquiries in this regard. Other than, the report of the CBI and the statement said to have been given by the employee of the Custom broker before the Magistrate, the enquiry conducted by the Customs authorities did not indicate any further corroboration. Learned Adjudicating Authority finds that the appellant has violated the provisions of CBLR, 2018 and yet, he finds that the violations do not warrant revocation of license. It is very difficult to understand as to how the allegations would invite a maximum penalty under Rule 18 ibid. One has to conclude that if the violations are not grave enough to warrant revocation of license, they do not warrant maximum penalty under Rule 18 also. Moreover, the appellants have brought out the procedural inadequacies. The impugned order is not sustainable and is set aside - appeal allowed.

Summary

Issues involved:
The issues involved in the judgment are the initiation of proceedings based on a unilateral version of CBI, violation of principles of natural justice in the inquiry process, and the imposition of penalty on the appellant for alleged violations of customs regulations.

Unilateral Version of CBI:
The appellant argued that the proceedings were initiated solely based on the report forwarded by CBI without any other supporting material. The appellant contended that the self-contained report of CBI was merely a list of allegations and that due process of law was not followed in issuing the impugned order. The appellant emphasized that no relevant documents were provided, and the Department relied solely on the untested version of CBI, which had not been accepted by any court of law.

Violation of Principles of Natural Justice:
The appellant raised concerns regarding the inquiry conducted by the Inquiry Officer, alleging gross violations of the principles of natural justice. It was argued that the documents relied upon were not supplied to the appellant, denying them the opportunity for cross-examination as per established legal precedents such as Kuldeep Singh vs Commissioner of Police and Andaman Tiber Industries Vs CCE, Kolkata-II.

Imposition of Penalty and Violation of Customs Regulations:
After considering both sides and examining the records, it was found that the appellant, a customs broker, was alleged to have been involved in illegal gratification activities. The Adjudicating Authority concluded that the appellant violated provisions of Rule 10(i) and Rule 13(12) of CBLR, 2018. Despite finding the violations, the Adjudicating Authority did not revoke the appellant's license but imposed a penalty. The judgment highlighted that the evidence available was not conclusive beyond doubt, mainly relying on the CBI report and a statement given by an employee before the Magistrate. The judgment emphasized that the allegations were pending adjudication in a competent court and did not constitute irrefutable evidence against the appellant. Ultimately, the judgment found that the violations did not warrant revocation of the license and questioned the imposition of the maximum penalty under Rule 18, leading to the impugned order being set aside, and the appeal being allowed.