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Showing 21 to 40 of 39920 Records
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2025 (3) TMI 1259
Confiscation of export goods - prohibited goods or not - Whether export goods become prohibited for export on account of non-declaration of technical characteristics of inputs on shipping Bills as was required in terms of DFIA Scheme? - HELD THAT:- In the present case, the show cause notices have been issued with respect to the exports made by appellants. Apparently and admittedly no exemption from duty has been claimed on such exports. Further these notifications require that the product manufactured out of these imported inputs i.e. the Resultant Product should have same quality, technical specifications and characteristics as that of the imported materials used in the said resultant product.
The Revenue/department has failed to produce any evidence to prove that the exported goods were the resultant goods and were not of same quality, technical characteristics and specifications as those of the inputs used in the said resultant product. It becomes clear that there is no evidence to support the violation of Condition No. (i) of both the notifications.
Hon’ble Supreme Court in the case of Titan Medical System Pvt. Ltd. Vs. Collector [2002 (11) TMI 108 - SUPREME COURT] has held that in the absence of any action taken by the licensing authority, revenue cannot take any action that too on the allegations of misrepresentation/suppression on part of assessee. Thus we are of the opinion that non-compliance of condition of DFIA/Notifications in the shipping bills could affect the duty free import of inputs but shall have no effect on export of products for which there is no evidence that the export goods were “resultant products” as mentioned in 4.55 of HBP.
Revenue has failed to produce any such law, rule, notification policy or any such thing, according to which there is restriction in export of pan masala and gutkha. In such circumstance, any condition on imports and non-compliance thereof cannot affect the exportability; Not specifically in the present case when DFIA was obtained post impugned export and was transferred also to third party and also when no exemption is availed by appellants while exporting pan masala and gutkha. More so for the reason the exported products were got manufactured from synthetic oils procured domestically. The synthetic oils are not mentioned in para 4.55 of HBP. Revenue also has failed to produce any evidence that the exempted pan masala and gutkha were the Resultant Products of the duty free inputs i.e. the natural essential oils imported under DFIA.
Whether non compliance of condition of DFIA i.e. non-declaration of technical characteristics of inputs on the shipping bills as required under para 4.55/4.32 of HBP and under Notification No. 40/2006 dated 01.05.2006 and Notification No. 98/2009 dated 11.09.2009 for the purpose of duty free import of inputs can render the export goods as “Prohibited Goods”? - HELD THAT:- On looking into the definition of “Prohibited goods means goods the import or export of which is subject to any prohibition under this Act or any other law for the time being in force but does not include any such goods in respect of which the conditions subject to which the goods are permitted to be imported or exported have been complied with.” Apparently there was no condition on the export of pan masala and gutkha. The condition which is alleged to have been violated is the condition of import. Thus, it is clear that based on impugned allegations freely exportable pan masala and gutkha cannot be called as prohibited goods. Above all, appellant has availed no benefit out of alleged non-declaration.
Levy of penalty under Section 113(1) of the Customs Act, 1962 - HELD THAT:- The alleged non-compliance cannot render the export goods prohibited, the order of confiscation passed by adjudicating authority below is not sustainable. Once goods are not found to be liable for confiscation, penalty under Section 113(1) of the Customs Act, 1962 cannot be sustained. The penalty imposed is also required to be set aside.
Conclusion - The goods exported i.e. pan masala and gutkha were freely exportable goods in terms of Foreign Trade Policy. Those have wrongly been called as prohibited for alleged violation of the conditions meant for duty free imports. Also there is no evidence proving connection between imported inputs and the export goods. The order confiscating those export goods and imposing penalty on the appellants is, therefore, not sustainable.
Appeal allowed.
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2025 (3) TMI 1258
Confiscation of gold bangles - diversion of export consignment of gold jewellery, after completion of all export formalities - levy of penalties u/s 114(iii) and 114AA of the Customs Act, 1962 - quantum of redemption fine.
Version of the exporters, Shri Preet Kumar Agarwal and Shri Sanjay Agarwal, is that as Shri Preet Kumar Agarwal was not having the boarding pass and immigration clearance, therefore, he was unable to board the plane, whereas, version of the DRI is that on an intelligence that the export consignment would be diverted, the DRI caught Shri Preet Kumar Agarwal while he was proceeding to Gate No. 11 of the NSCBI Airport while boarding the flight while having no jewellery in his hand.
HELD THAT:- As there were twisted facts from both the sides, to know the truth of the facts, the CCTV footage was very much relevant in order to ascertain as to whether the exporters were correct or the DRI was correct. However, admittedly, the CCTV footage was not placed in the present case and are not part of the relied upon documents. However, other CCTV footages have been relied upon by the DRI to establish their case. This indicates that there were some lapses in the investigation.
It is the case of the DRI that after taking Shri Preet Kumar Agarwal into custody while he was boarding the flight without jewellery, on his intimation that the said jewellery had been handed over to Shri Sanjay Agarwal who had booked the said jewellery in air cargo for Hyderabad, the flight was stopped by the DRI and Shri Sanjay Agarwal, who had boarded the plane, was apprehended by taking him out of the said flight. Here, the question arises that: if the DRI was having prior information on 03.04.2018 that diversion of export consignment would take place, then, when Shri Preet Kumar Agarwal handed over the consignment to Shri Sanjay Agarwal outside the Airport, why did the DRI not apprehend Shri Sanjay Agarwal who was carrying the export consignment at the time when diversion of the goods was taking place? This raises a question mark on the version that the DRI was having prior knowledge of diversion of export consignment of gold jewellery.
The investigating team has heavily relied on the statements recorded during the course of investigation. However, all those statements were retracted before the Additional Chief Judicial Magistrate. However, the procedure prescribed under Section 138B(b) of the Customs Act, 1962 that a statement relied during the course of proceedings is required to be examined in chief and thereafter be allowed for cross-examination, has not been followed in the present case. Therefore, in such circumstances, the statements recorded by the investigating team, which have been retracted before the Additional Chief Judicial Magistrate, have no relevance to implicate the exporters in this case.
Although COFEPOSA proceedings were initiated, the proceedings against Shri Preet Kumar Agarwal were dropped vide Order of the Central Economic Intelligence Bureau, COFEPOSA Wing dated 16.08.2015, who, as per the allegations, was the main person involved in diversion of the gold jewellery in question. When the COFEPOSA proceedings against the person who was involved in diversion of the gold jewellery in question as per the investigation have been dropped, the case against the co-exporters are also not sustainable.
Any goods cleared for exportation which are not loaded for exportation on account of any wilful act, negligence or default of the exporter, his agent or employee or which having been loaded for exportation, are unloaded without the permission of the proper officer, are liable for confiscation. Admittedly, it is a case of negligence on the part of the exporters, being the circumstances at that time, the exporter was required to take more precaution but failed to do so and the goods cleared for exportation were not loaded for exportation - the goods in question are liable for confiscation under Section 113(k) of the Act.
Imposition of penalties under Section 114(iii) of the Act - HELD THAT:- Since the goods have been held liable for confiscation under Section 113(k) of the Act, penalties under Section 114(iii) are imposable on the appellants/exporters.
Imposition of penalty under Section 114AA of the Customs Act - HELD THAT:- The said provisions are not attracted in this case as penalty under Section 114AA can be imposed on a person who knowingly or intentionally makes, signs or uses, or causes to be made, signed or used any declaration, statement or document which is false or incorrect in any material particular, in the transaction of any business for the purposes of the Act. Admittedly, in this case, documents were not found to be false or fabricated. Therefore, the provisions of Section 114AA are not attracted in the present case to impose penalty.
Quantum of redemption fine to be imposed - HELD THAT:- The appellants-exporters have submitted that the value addition is only to the extent of Rs. 43,400.43 if making charges of the said jewellery after importation are taken into consideration. Thus, the redemption fine imposed on the appellant is on the higher side. Accordingly, the redemption fine imposed reduced to Rs.15,00,000/-.
Conclusion - i) The order of confiscation of the consignment of 1194 pcs of gold bangles weighing 54096 gms. upheld, having an ascertained value of Rs.16,10,43,792/- cleared by diversion of the consignment in the domestic area, under Section 113(k) of the Customs Act, 1962. ii) Redemption fine of Rs.15,00,000/- imposed u/s 125 of the Act for redemption of the goods confiscated on account of diversion of the export consignment. iii) Since the goods have been held liable for confiscation under Section 113(k) of the Act, penalties under Section 114(iii) are imposable on the appellants/exporters. iv) The provisions of Section 114AA are not attracted in the present case to impose penalty. v) The gold jewellery, which has been seized from the possession of Shri Sanjay Agarwal, is to be released to Shri Sanjay Agarwal on payment of redemption fine and penalties. vi) No proceedings are sustainable against the other noticees to the SCN issued in this case.
Appeal disposed off.
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2025 (3) TMI 1208
Seeking release of the two detained gold items on the ground that the same are personal jewellery of the Petitioner - Time limitation - HELD THAT:- Once the goods are detained, it is mandatory to issue a show cause notice and afford a hearing to the Petitioner. The time prescribed under Section 110 of The Customs Act, 1962, is a period of six months and subject to complying with the formalities, a further extension for a period of six months can be taken by the Department for issuing the show cause notice.
Since the outer period of one year has also elapsed in the present case, the goods of the Petitioner deserve to be released. Moreover, they were personal jewellery of the Petitioner which could not have been detained in the first place.
Let both the gold items be released to the Petitioner without payment of any storage charges within four weeks - Petition disposed off.
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2025 (3) TMI 1207
Seeking issuance of an appropriate writ setting aside the seizure of goods (personal jewellery) detained by the Customs Department of the Petitioners - HELD THAT:- When the Petitioners landed at the Indira Gandhi International Airport, New Delhi on 29th July, 2024, the personal jewellery of Petitioner No. 1, containing of one gold kangan, four gold rings, one gold necklace along with also personal jewellery of Petitioner No. 2 containing of one gold chain with pendant, one gold kada and three gold rings were seized by the customs officers. The detention receipt was issued on 29th July, 2024. The total weight of the products seized was 318 grams and 597 grams.
The Court has perused the documents placed. Clearly, the Petitioners are Indian citizens who were coming back after attending a social family event in the USA and the jewellery which was owned by them were their personal effects - The detention took place in July 2024 and show cause notice has also not been issued.
There can be no justification for detaining the said goods. The same shall accordingly be released within four weeks to the Petitioners in person or through an authorized representative subject to verification - no storage charges shall be collected by the Customs Department.
Conclusion - There are no justification for the detention of the goods, particularly as no show cause notice had been issued since the seizure. The goods are ordered to be released.
Petition disposed off.
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2025 (3) TMI 1206
Classification of goods - PVC Resin Grade SP 660 (Suspension Grade) - CESTAT, Chennai refused to entertain the matter and had disposed it on the ground of monetary value - HELD THAT:- Considering the fact that the same product is involved even in the order passed by CESTAT, Chennai and the classification of this product for the period prior to 2017 has not been settled, this Court deems it appropriate to remand the matter to CESTAT, Principal Bench, New Delhi for a fresh adjudication on the classification issue itself and not to dispose of the matter on merely the monetary limit.
Petition disposed off by way of remand.
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2025 (3) TMI 1205
Seeking issuance of an appropriate writ directing the Respondent to release the electronic devices of the Petitioners - smuggling of substantial quantity of foreign origin gold in a completely concealed manner through triangular valves - HELD THAT:- If any particular document, which is downloaded from the devices of the Petitioners is also relied upon by the Respondent either in the show cause notice proceedings or in the prosecution complaint, the said Relied Upon Documents (RUDs) shall be listed and copies shall be provided to the Petitioners. In light of the above, the Petitioner would not raise any objections as to non-fulfilment of any requirement under Section 63 of the Bharatiya Sakshya Adhiniyam, 2023 and Section 138C of the Customs Act, 1962.
This process could be adopted by the Commissioner of Customs in all the Commissionerates, so that persons from whom devices are seized can be returned the same, after the data is copied. The retention of the devices throughout the Show Cause Notice (SCN) proceedings and the prosecutions, unless essential, could then be avoided, as the devices themselves may become completely out-dated and retrieval of data from the same after a few years also becomes difficult. The proper copying of the data and retention of the same on Servers in the Customs Department would also make it accessible to the investigation officers as also other personnel.
Conclusion - The return of electronic devices ordered, after data copying, with the Petitioners agreeing not to object to the data's mode of proof. A standard procedure for data retrieval and preservation was recommended.
Petition disposed off.
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2025 (3) TMI 1204
Seeking issuance of an appropriate writ directing return of the goods seized by the Respondent- Customs Department - Possession of 4 old and used iPhone - tiem limitation for issuance of SCN - Petitioner submits that the six-month period has already lapsed and, therefore, the show cause notice is belated in terms of Section 110 of the Customs Act, 1962 - HELD THAT:- The date of the show cause notice is 17th January, 2025. The time prescribed under Section 110 of the Customs Act, 1962, is a period of six months subject to complying with the formalities. The Department is entitled to obtain a further extension of six months in terms of Section 110 (5) of the Customs Act, if needed.
The show cause notice is dated 17th January, 2025 and is, therefore, within the six months period. The question as to whether the same was delivered to the Petitioner within the prescribed period or not or whether the extension was obtained or not, would be a question of fact.
The Petitioner is free to approach the Adjudicating Authority for provisional release of goods, in accordance with law - Petition disposed off.
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2025 (3) TMI 1203
Maintainability of petition - availability of alternative remedy - Diversion of imported goods - walnut kernels - allegation in the said Show Cause Notice was that the goods which were imported were not exported back and were in fact, diverted to the domestic market - HELD THAT:- The Court is of the view that the Petitioners ought to be relegated to avail of the remedy against the impugned Order-in-Original before the CESTAT, as done in the connected case. In Nitin Nagpal v. Union of India & Anr. [2025 (3) TMI 1149 - DELHI HIGH COURT], this Court had directed 'the Court is of the view that the Petitioners ought to be relegated to avail of the remedy against the impugned Order-in-Original before the CESTAT. This Court has not examined any of the grounds which have been raised by the Petitioners. All objections are kept open. The Petitioners are free to raise all their grounds of challenge to the impugned order before CESTAT.
Accordingly, the Petitioners are relegated to avail of their appellate remedy before CESTAT. The Petitioners are free to raise all their grounds of challenge to the impugned order before CESTAT. This Court has not examined any of the grounds which have been raised by the Petitioners. All objections are kept open. If the CESTAT finds it relevant, the cross-examination of the ICAR scientists before the Principal Commissioner in the connected matters may be taken into consideration for adjudication of the appeals.
Considering the nature of the matter and the submissions made today, in the unique facts and circumstances of these cases, following the order passed in the similar matter involving the same petitioners, the pre-deposit for filing the appeal is reduced to 3.75%. This order shall not be treated as a precedent.
Petition disposed off.
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2025 (3) TMI 1202
Delay in adjudicating the show cause notice issued in 2014 - proceedings against other co-noticees, when the settlement of duty and interest done by the main firm - HELD THAT:- This case would be clearly covered by the previous decisions of this Court in M/s Vos Technologies India Pvt. Ltd. v. The Principle Additional Director General &Anr. [2024 (12) TMI 624 - DELHI HIGH COURT] where it was held that 'The flexibility which the statute confers is not liable to be construed as sanctioning lethargy or indolence. Ultimately it is incumbent upon the authority to establish that it was genuinely hindered and impeded in resolving the dispute with reasonable speed and dispatch. A statutory authority when faced with such a challenge would be obligated to prove that it was either impracticable to proceed or it was constricted by factors beyond its control which prevented it from moving with reasonable expedition. This principle would apply equally to cases falling either under the Customs Act, the 1994 Act or the CGST Act.'
In terms of the settled legal position, the Order-in-Original dated 30th March, 2024 was passed pursuant to the show cause notice dated 30th December, 2014, which is almost a ten year old notice. In the opinion of this Court, the same cannot be sustained. Accordingly the said Order-in-Original dated 30th March, 2024 is set aside and the proceedings against the Petitioners shall stand quashed.
Petition disposed off.
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2025 (3) TMI 1201
Seeking for deletion of penalty and redemption fine imposed against the Appellant - Appellant had availed the benefit of Amnesty Scheme by making payment of the entire Customs duty - HELD THAT:- Snce Appellant had sought for deletion of penalty and redemption fine imposed against the Appellant, the part component of which is addressed in the above para and the other part concerning confiscation would no more be valid as the Act or its omission had been regularised through the Amnesty Scheme launched by the Government of India, the order passed by the Commissioner (Appeals) against which appeal has been pending before this Tribunal at the time of availment of such Amnesty Scheme, becomes unenforceable after irregularity, if any, has been remediated and therefore, the same is required to be set aside. Hence the order.
The order passed by the Commissioner of Customs (Appeals), Mumbai-II is hereby set aside - Appeal allowed.
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2025 (3) TMI 1200
Revocation of Customs Broker License - forfeiture of security deposit - levy of penalty - breach of regulation 10(d), 10(e) and 10(f) of Customs Broker Licensing Regulations, 2018 - drawback allegedly claimed in excess of eligibility by several exporters - appellant had failed to brief the exporter on the significance of the declarations owing to which the three regulations were breached.
HELD THAT:- The alleged conspiracy is mere narration of events and episodes leading to the eventual decision to proceed against the appellant, and others, under the Customs Broker Licensing Regulations, 2018. It was necessary for the licensing authority to depict the elements of this conspiracy in terms of the stipulations in Customs Act, 1962 that were breached thereof and attributable, in part at least, to failure in advising the client to comply with the statutory requirements, failure to ascertain information supplied to client owing to which the client had strayed and the failure to communicate the instructions in circulars and public notices. The second of the foundations of the proceedings, viz., the circular [no. 16/2009-Cus dated 25th May 2009] having been overlooked, has no bearing on the first and amenable to being invoked on its own as a factual base for the third charge.
There appears to be an implicit assumption in initiation of the proceedings that each, and every, obligation of customs brokers has been designed to be fulfilled vis-à-vis customs authorities and, therefore, perceivable as inferences that the licencing authority, who is neither the customs authority in the connected incident nor the client of the customs broker, may choose. That breach of obligations is to be visited with proceedings prescribed in Customs Broker Licensing Regulations, 2018 is no ground for such presumption - Some obligations would, therefore, stem from that owed to clients and, hence, the determination of time lines with reference to ‘offence report’ which may originate with client. That perception of cause and effect has to be appreciated and comprehended for proper exercise of authority to punish brokers.
From a reading of the charges, the imputation of misconduct and the findings in the impugned order, none of the facts and circumstances advance the proposition that regulation 10(d) and regulation 10(e) of Customs Broker Licensing Regulations, 2018 had been breached.
Conclusion - The failure to file the declaration may at best, be considered a technical irregularity inasmuch as it was not noticed by the customs authorities either. In any case, the drawback claims in the seven shipping bills, even if ineligible, is not of such magnitude as to warrant imposition of all the penalties and detriments available in the empowerment of the licensing authority. The interest of justice would be met by setting aside the revocation and forfeiture of security deposit under regulation 14 of Customs Broker Licensing Regulations, 2018 while upholding the penalty under regulation 18 of Customs Broker Licensing Regulations, 2018.
Appeal disposed off.
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2025 (3) TMI 1199
Applicability of rule 8 of Customs Valuation (Determination of Price of Imported Goods) Rules, 1988 to the circumstances of import for revision of declared value of imports of ‘cloves’ originating from Indonesia/Tanzania - provisional assessment under section 18 of Customs Act, 1962 - HELD THAT:- It is on record that the importer had failed to furnish any evidence of value being likely to be lower than the prices of contemporary transactions, through preceding invoices, or, through preceding test reports, of quality of the cloves, leaving no option, consequent upon the direction of the Tribunal, but to finalize the assessment on available documents and declaration. In the circumstances, recourse to rule 10A of Valuation (Determination of Price of Imported Goods) Rules, 1988 for discard of the declared value is not exceptionable as upheld in the impugned order. There are no reason to concur with the Learned Counsel that the declared value should not have been rejected in the circumstances.
There is no doubt that rule 8 of the said Rules afforded a flexibility, not available now under the extant Rules notified in terms of section 14 of Customs Act, 1962, but was, yet, subject to conformity with the general principle of value espoused in rule 3 therein and specific exclusions. The impugned order is not reticent in referring to 19 bills of entry which, admittedly, are not in conformity with scheme of ‘surrogate value’ set out in rule 5 of the said Rules - Recourse to rule 10A of Customs Valuation (Determination of Price of Imported Goods) Rules, 1988 is required to be brought to a logical conclusion within the signification of rule 5 to rule 8 of the said Rules. Failure to do so, by non-availability of substitute value, rescinds the finding of non - acceptance of the declared value.
Conclusion - The revision in value is without authority of law and on facts which do not find acceptance of substituted value within the framework of Customs Valuation (Determination of Price of Imported Goods) Rules, 1988.
The impugned order is set aside - appeal allowed.
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2025 (3) TMI 1198
Scope for re-determination of value under Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 and consequential penalty under section 112 of Customs Act, 1962 - no differential duty to be levied - HELD THAT:- The issue decided in Prakash Sancheti [2013 (8) TMI 506 - CESTAT AHMEDABAD] where it was held that 'The extent of over-invoicing is so high that the actual value of the goods was found to be 3.56% of the actual. In fact the learned advocate on behalf of the Hong Kong exporters submitted that the Commissioner has discussed the earlier import and export but since she has not based her conclusions on those transactions, he did not contest those findings nor made any submissions thereon. It would not be fair on our part also to consider the past activity for the purpose of deciding whether goods have to be absolutely confiscated or not.'
The only issue before the Tribunal then was the exercise of discretion by the adjudicating authority insofar as offer of redemption on payment of fine under section 125 of Customs Act, 1962 is concerned. Furthermore, the matter of certification under Kimberley Process Certificate (KPC) was not an issue adjudged by the Tribunal and it was solely on the ground of mis-declaration of value that the confiscation had been upheld. In re Dinesh Dhola and others, the Tribunal took note of failure to have Kimberley Process Certificate (KPC) verified on which was premised the prescription claimed to warrant absolute confiscation.
In circumstances of the taint attached to handling of allegedly ‘conflict diamonds’ that the importer assumed responsibility to re-export, the confiscation of the goods without offer of redemption is held to be inappropriate. The manner in which the value has been determined in accordance with the provisions of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 bears further evaluation to comply with section 2(41) of Customs Act, 1962. Such was not the requirement under section 17 of Customs Act, 1962 on every shipping filed under section 50 of Customs Act, 1962 but also wherever ‘value’ find reference insofar as the handling of the imported goods is concerned.
Conclusion - i) Absolute confiscation of the rough diamonds was inappropriate due to the lack of a valid ground based on the Kimberley Process Certificate mismatch. The goods should have been allowed for re-export. ii) The re-determination of value under the Customs Valuation Rules was flawed and required re-evaluation in accordance with the proper legal framework. iii) The imposition of penalties was contingent upon the re-determination of value and thus required reconsideration. iv) There is a need for proper verification of the Kimberley Process Certificate and cautioned against hasty actions leading to absolute confiscation.
The matter remanded back to the original authority for a fresh decision - Appeal allowed by way of remand.
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2025 (3) TMI 1197
Breach of regulation 10(d), 10(e), and 10(m) of Customs Brokers Licensing Regulations, 2018 for compromising customs clearance by obtaining ‘out of charge’ on the strength of examination of only three containers - HELD THAT:- The inquiry report found the appellant to have breached regulation 10(d) and 10(e) of Customs Brokers Licensing Regulations, 2018 and, thereafter, Principal Commissioner of Customs (General), Mumbai, the licensing authority, revoked the customs broker licence and forfeiting the security deposit under the authority of regulation 14 of Customs Brokers Licensing Regulations, 2018 while further imposing penalty of ₹ 50,000 under regulation 18 of Customs Brokers Licensing Regulations, 2018 by order impugned here. The licensing authority held breach of regulation 10(d) of Customs Brokers Licensing Regulations, 2018 to be proved for non-compliance with the direction to submit the entire consignment for examination, as evidenced by payment of service fee of only ₹ 3,750 (₹ 1,250 each TEU) and confirmation thereof from ‘closed circuit television cameras’ installed at the examination area, and thus establishing failure to advise the client to comply with the provisions of the Act, allied Acts and Rules and Regulations and failure, upon non-compliance thereof, to bring the matter to the notice of the Deputy Commissioner/Assistant Commissioner as the case may be.
There is no doubt that examination as set out in the ‘handwritten’ directions were not carried out. There is, however, no ascertainment of disinclination on the part of customs official, having granted ‘out of charge’ while cognizant of the directions, to carry out such examination and availability of contingent option to report to higher authorities. The drawal of samples which was sufficient to establish misdeclaration as well presentation of three containers make it abundantly clear that appellant was either not aware of the contents or that there was no intent to conceal the offending goods from action under Customs Act, 1962. The failure to produce the remaining containers or to guide the client in that direction is, at best, a technical violation.
There are no evidence to charge the customs broker with not advising the client on requirement to comply with the statues; nor of participation in compelling customs officials not to carry out examination. There is, thus, no evidence to hold that regulation 10(d) of Customs Brokers Licensing Regulations, 2018 had been breached.
The licensing authority has mis-applied regulation 10(e) of Customs Brokers Licensing Regulations, 2018 which may be invoked only upon complaint from client of having been so misguided by customs broker. The requirements of examination was, admittedly, endorsed on the bill of entry and, in granting ‘out-of- charge’, the customs officials cannot but have been privy to such instruction. Failure of such customs officials to act on the instruction cannot be attributed to the customs broker inasmuch as the latter does not have the authority to enforce compliance on the part of the customs officials - There is passing reference to alleged collusion of employee of the customs broker with customs officials that does not fall within the purview of regulation 10(e) of Customs Brokers Licensing Regulations, 2018. Consequently, the facts alleged has no bearing on this particular obligation or breach thereof.
Conclusion - There is no defence from the appellant about the cause of non-compliance with inspection requirements in full and, in absence thereof, responsibility is to be presumed, at least partially, even if of no serious consequence. Consequently revocation of licence with forfeiting of security deposit is set aside. Imposition of penalty of ₹ 50,000 is sustained.
Appeal allowed.
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2025 (3) TMI 1196
Breach of regulation 10(d), 10(e), 10(n) and 13(2) of Customs Brokers Licensing Regulations, 2018 - entire case of the licensing authority appears to have been built upon the conclusion that the ‘exporter on record’ were a mere fronts and that the beneficiary of the admitted ‘over-valuation’ were those who controlled the transactions behind the scenes - HELD THAT:- In the impugned order, there is neither hint nor whisper of such grievance on the part of the client and yet that did not deter the licensing authority from holding that the customs broker had deviated from the obligations set out in regulation 10(e) of Customs Brokers Licensing Regulations, 2018 which only the client could be concerned with. The facts relied upon, as well as the conclusion thereupon, in the impugned order are far from that contemplated under regulation 10(e) of Customs Brokers Licensing Regulations, 2018. There are no hesitant in holding that the licensing authority has erred to hold that to be proved.
There is, of course, a fundamental stipulation that it is the responsibility of the customs broker to advice client to comply with all the statutory provisions that applicable to clearance of the goods belonging to the client. It is, however not necessary that every single provision in the several statutes would have to be intricted to the client. Neither is it necessary that it is the owners/officials of the importer/export entity who should be subjected to such education. That well may be impossible and it clearly not the intent of the Regulation that the customs broker should conduct a teachimg course on procedural and legal stipulations pertaining to clearance of the goods. The breach of such obligation would have to be inferred from facts which demonstrate negligence on part of customs broker to advice contextually - There is no evidence to conclude that the licensing authority was correct in determining breach of regulation 10(d) of Customs Brokers Licensing Regulations, 2018.
There is no doubt that the antecedents of the client need verification and, to the extent that the specifics of such verification are set out in the said Regulation, existence of documentation would suffice as compliance. There is no allegation that the client was not in possession of genuine importer-exporter code (IEC) or, for that matter, of GST registration. Nonetheless, the records do show that no operations appeared to have been carried out at the declared address of the exporter. Whether verification of the premises would have prevented overvaluation of goods is moot; however, that the exporter did not operate at the declared address indicates that the verification carried out by the customs broker was but cursory or non-existent. Licences issued to customs brokers is not merely an entry into practice of a trade or profession but is contingent upon expectation on the part of licensing authority that antecedents of importer/exporter are not doubtful - It would, therefore, appear that the appellant had restricted itself to verification of documents to the extent of availability in the public domain. Clearly, undertaking of work on behalf of the exporter without proper knowledge about the activities of the exporter is in breach of the obligation devolving on the customs broker under regulation 10(n) of Customs Brokers Licensing Regulations, 2018. To the extent that the licensing authority has held that the customs broker to be in breach thereof, we find no reason to disagree thereupon. The charge of violation of regulation 10(n) of Customs Brokers Licensing Regulations, 2018, is therefore, upheld.
Conclusion - Only regulation 10(n) of Customs Brokers Licensing Regulations, 2018 stands affirmed, fastening of all the detriments available in the Regulation is clearly disproportionate. The imposition of penalty under regulation 18 of Customs Brokers Licensing Regulations, 2018 suffices to meet the ends of justice. Accordingly, while setting aside the revocation of licence and forfeiture of security deposit, the imposition of penalty of ₹ 50,000/- upheld.
Appeal disposed off.
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2025 (3) TMI 1195
Denial of rectification of error for finalization of assessment of Shipping Bill under Section 154 of the Customs Act, 1962 - rejection solely on the ground that no arithmetical or clerical errors/mistakes have been noticed in the Final Assessment Order - HELD THAT:- It is an error arose from the accidental omissions on the part of the assessing officer while finalizing the Shipping Bills under Section 154 of the Customs Act, 1962 as held by this Tribunal in the case of M/s Sesa Goa Limited [2010 (9) TMI 948 - CESTAT MUMBAI]. Consequently, finalization of the assessment done by the adjudicating authority for determining of the “Fe” content on DMT instead of WMT basis, is bad in law. Therefore, the said omission is required to be rectified by the adjudicating authority and the consequential benefit is to be given to the appellant by rectifying the omission under Section 154 of the Customs Act, 1962.
Further, in the case of M/s Vedanta Limited [2023 (8) TMI 364 - CALCUTTA HIGH COURT], it is held that the error is perceived from the omission or the accidental slip and therefore, the word “omission” should not be given a restrictive meaning but should be expanded to imbibe within itself an error occurred because of such omission and the same is required to be rectified.
The adjudicating authority is directed to rectify the finalization of provisional assessment of shipping bills for the purposes of calculation of “Fe” content on WMT basis in terms of the order of the Hon’ble Supreme Court in the case of Gangadhar Narsingdas Aggarwal [1995 (8) TMI 73 - SUPREME COURT] and thereafter, to pass a speaking order within a period of one month from the date of receipt of this order.
Conclusion - The assessment should be corrected to reflect the "Fe" content on a WMT basis, and the adjudicating authority was directed to pass a speaking order within one month, providing the appellant with the appropriate relief under the applicable notification.
Appeal allowed.
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2025 (3) TMI 1194
Denial of rectification of error for finalization of assessment of Shipping Bill under Section 154 of the Customs Act, 1962 - while finalizing the Shipping Bills, no consideration of judicial pronouncements and the circulars cited hereinabove is clerical mistakes/omissions in terms of Section 154 of the Customs Act, 1962, on the part of the proper officer or not? - HELD THAT:- What is the clerical error/mistake apparent on record has been examined by this Tribunal in the case of Sesa Goa Limited [2010 (9) TMI 948 - CESTAT MUMBAI], wherein this Tribunal has observed 'As per the law dictionary “omission‟ means neglect or failure to perform what the law requires and in this case law requires to assess the Bill of Entry after taking note of the decision of TISCO which was omitted by the proper officer. If for such omissions or errors committed by the proper officer, the same is to be corrected while dealing with refund claims filed by appellant, the same will tantamount to be done under Section 154 of the Customs Act, 1962. That is why the legislature incorporated the Section 154 of the Customs Act into the statute book to rectify such omission or error without challenging the assessment.'
As in the case, the decision the Hon’ble Apex Court and the Circular dated 17.02.2012 was in public domain, in that circumstances, it is the duty of the adjudicating authority to take cognizance all the judicial pronouncements and the Circulars and thereafter, to pass the proper order, which the adjudicating authority has failed to do so in the case in hand while finalizing the Shipping Bills.
Conclusion - It is held that it is an error arose from accidental omissions on the part of the assessing officer under Section 154 of the Customs Act, 1962 as held by this Tribunal in the case of M/s Sesa Goa Limited. Consequently, finalization of the assessment done by the adjudicating authority for determining of the ‘Fe’ content on DMT instead of WMT basis, is bad in law. Therefore, the said omission is required to be rectified by the adjudicating authority and the consequential benefit is to be given to the appellant by rectifying the omission under Section 154 of the Customs Act, 1962 and thereafter, to determine the ‘Fe’ content on the basis of WMT basis and pass an appropriate order in accordance with law.
The impugned order is set aside - appeal allowed.
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2025 (3) TMI 1151
Challenge to Public Notice No.5/2020 dated 03.02.2020, as well as Exts.P3 toP5 communications issued - jurisdiction to issue public notice - HELD THAT:- Exts.P2 to P5 communications issued to them by the 3rd respondent runs contrary to the express terms of Ext.P1 Public Notice, and virtually reads-in conditions thereto that were not contained in, or contemplated through, Ext.P1 Public Notice. As a matter of fact, the respondents have not been able to point to any regulatory power on the basis of which a notice in the nature of Ext.P1 Public Notice could be issued, if it had the effect of interfering with the terms of a contract entered into between the shipping lines and the shipper/recipient of the goods under carriage. In the absence of such a regulatory power, traceable to the provisions of any statute or contract, such a power, that has the potential to interfere with the freedom of contract between parties, cannot be inferred from the terms of a Public Notice.
Ext.P2 to P5 communications are legally flawed and contrary to Ext.P1 Public Notice.
Conclusion - The Court set aside the communications (Exts.P2 to P5) as legally flawed and contrary to the Public Notice. It held that the Public Notice should not be interpreted in a manner that interferes with private contracts.
Appeal allowed.
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2025 (3) TMI 1150
Jurisdiction of Directorate of Revenue Intelligence (DRI) officials under Section 28 of the Customs Act, 1962 to issue SCN - proper officer or not - HELD THAT:- In the present petition, the show cause notice which is under challenge is dated 1st May, 2019 issued by the DRI, Mumbai Zonal Unit. This would be covered by directions given in paragraph 168 (vi) (a) of the Canon-II [2024 (11) TMI 391 - SUPREME COURT (LB)], wherein the adjudication of the show cause notice is to be restored to the adjudicating authority.
The proceedings in the show cause notice under challenge dated 1st May, 2019 shall now proceed before the appropriate adjudicating authority in accordance with law.
Petition disposed off.
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2025 (3) TMI 1149
Maintainability of petition - diversion of imported walnuts into the domestic market, by not re-exporting - no opportunity was afforded for personal hearing - violation of principles of natural justice - HELD THAT:- The Court is of the view that the Petitioners ought to be relegated to avail of the remedy against the impugned Order-in-Original before the CESTAT. This Court has not examined any of the grounds which have been raised by the Petitioners. All objections are kept open. The Petitioners are free to raise all their grounds of challenge to the impugned order before CESTAT.
Considering the nature of the matter and the submissions made today, in the unique facts and circumstances of these cases, the pre-deposit for filing the appeal is reduced to 3.75%. This order shall not be treated as a precedent.
Petition disposed off.
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