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2024 (10) TMI 1264 - HC - CustomsViolation of CBLR, 2018 by Customs Broker - violation of Regulations l0(d) and 10 (n) of CBLR, 2018 and/or Regulation 11 of CBLR, 2013 - failure to appreciate the statements on record as a whole - HELD THAT - CESTAT found that CB had met the IEC holders in person and they handed over the documents as are required under KYC guidelines and they themselves acknowledged Sandeep Jain to be their representative. CESTAT rightly observed that the Regulations nowhere bar such kind of consensual arrangement between the IEC holders and Sandeep Jain. CESTAT has also noted that on behalf of the importing firms, Sandeep Jain had handed over the export documents and the payments also used to go to the respective accounts as disclosed by Sandeep Jain/IEC holders. CESTAT concluded that all the importers were having requisite documents and they were in existence and appellant had not reaped any benefit out of the arrangement between the importers and Sandeep Jain. The order passed by the CESTAT is based on sound reasoning and due application of principles of law - Appeal dismissed.
Issues:
1. Challenge to final order passed by CESTAT regarding violation of CBLR, 2018 by Customs Broker. 2. Allegations against Customs Broker for involvement in illegal import activities. 3. Violation of Regulations 10(d) and 10(n) of CBLR, 2018. 4. Appellant's contentions regarding failure of CESTAT to appreciate statements and facts of the case. Analysis: Issue 1: The Revenue challenged the final order passed by CESTAT, Delhi, which set aside the Order-in-Original revoking the Customs Broker's license. The case involved allegations of misdeclaration and under-valuation in the import of Water Treatment Membranes by Sandeep Jain through various firms. The Revenue contended that CESTAT erred in not appreciating the violations of Regulations 10(d) and 10(n) of CBLR, 2018. Issue 2: The Respondent, a Customs Broker, was accused of involvement in illegal import activities related to Water Treatment Membranes. The Joint Commissioner issued an offense report against the Respondent, leading to the revocation of the Customs Broker license, forfeiture of security deposit, and imposition of a penalty. The Respondent appealed to CESTAT, which overturned the Order-in-Original, prompting the Revenue's appeal. Issue 3: Regulation 10(d) of CBLR, 2018 requires a Customs Broker to advise clients to comply with relevant provisions and report non-compliance to Customs authorities. The Adjudicating Authority found a violation based on non-cooperation of IEC holders and Sandeep Jain. However, CESTAT disagreed, stating that the Broker was not responsible for ensuring the attendance of importers before authorities, citing a lack of legal provision for such responsibility. Regulation 10(n) mandates verifying client details and IEC numbers using authentic documents. The Adjudicating Authority found the Broker in violation due to untraceable importers and non-existent firms. CESTAT, after analyzing statements, concluded that the Broker had met IEC holders, verified documents, and had a consensual arrangement with Sandeep Jain, not breaching Regulation 10(n). Issue 4: The Appellant argued that CESTAT failed to appreciate the statement of the Broker admitting non-compliance with CBLR, 2018. The Appellant contended that the Broker did not verify importer premises, dealt with Sandeep Jain without proper authorization, and failed to fulfill obligations under the Regulations. The Appellant claimed that CESTAT's order was erroneous and not in line with the law. In conclusion, the High Court dismissed the appeal, upholding CESTAT's decision based on a thorough analysis of the facts and legal provisions. The judgment emphasized the lack of substantial legal questions arising from the appeal and affirmed the sound reasoning applied by CESTAT in its decision.
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