2024 (1) TMI 645 - AT - Customs

Revocation of license of CHA firm - forfeiture of security deposit - levy of penalty - certain Mumbai based operators imported high end cars/SUVs in the name of third parties by resorting to fraudulent means in breach of the provisions of Foreign Trade Policy and the Customs Act - alleging violation of Regulation 12, 13(a), 13(b), 13(d), 13(e) and 19(8) of the said Regulations (CHALR 2004) - HELD THAT - It has been brought to notice that at least in 8 cases, any revenue loss caused to the department, was made good and the vehicles cleared upon payment of necessary dues. Though there is no denying the fact that the appellant had committed grave error in law, and we find them to have contravened the legal stipulations. It is also noted that the licence has now been revoked for nearly 10 years and more. This in itself, effecting the livelihood of the appellant, is considerable punishment and beyond what ought to have been imposed upon the appellant for various breaches. It is thus noted that the appellant have undergone grave hardship. The consequences of the aforesaid violation have been significantly harsh vis- -vis, the infringement in law made through Manish Chatwani by the appellant by way of lending out their licence for financial considerations. The licence cannot be allowed to remain revoked in perpetuity - the ends of justice shall be met in this case by maintaining the order of the Ld. Commissioner in so far as forfeiture of the Security Deposit of Rs.50,000/- is concerned with. Appeal disposed off.

Summary

Issues involved: Appeal against Order-in-Original under Customs House Agent Licensing Regulations, 2004.

Summary:
The appeal was filed by M/s. Tulip International challenging an order passed by the Commissioner of Customs concerning proceedings initiated under the Customs House Agent Licensing Regulations, 2004. The case involved the suspension of CHA licenses at Mumbai and Kolkata, followed by a show cause notice alleging various violations of the regulations. An investigation revealed fraudulent activities in importing vehicles, leading to charges against the appellant.

The appellant argued jurisdictional issues, claiming Kolkata authorities had no jurisdiction over the Mumbai offense. However, it was noted that the appellant's license was issued by the Calcutta Customs House, allowing business transactions at Mumbai under Regulation 9.

Various violations of CHALR 2004 were highlighted, including mis-declaration of vehicles, misuse of licenses, and lack of due diligence. The key conspirator, Manish Chatwani, admitted complicity in clearing vehicles through the appellant's license for financial gain. The appellant was found guilty of offenses, including the transferability of the license, lack of authorization from importers, and failure to transact business personally or through authorized employees.

The Tribunal acknowledged the violations and the impact on the appellant's livelihood but decided to uphold the forfeiture of the Security Deposit while restoring the CHA license. The revocation of the license for over 10 years was deemed excessive, and justice was deemed served by reinstating the license to the appellants.

In conclusion, the appeal was disposed of by maintaining the Security Deposit forfeiture and restoring the CHA license to the appellants.