2012 (10) TMI 311 - AT - Customs

CHA - forfeiture of the security - violation of Regulation 13(a) and (d). The allegations are that they did not have an authorisation from M/s. Nelcast Ltd., the importers and they did not advise the importers that the impugned goods were required to be re-exported within a period of six months Held that - There is nothing to indicate that the appellant-CHA has acted mala fide in any manner. It is usual in international trade these days for logistic companies to act as agents of the importers and exporters and engage CHAs on their behalf - appellant-CHA did not act mala fide and they had the tacit authorisation of the importers M/s. Nelcast Ltd., to deal with the goods for Customs clearance purposes. It is also clear that M/s. Nelcast Ltd., did not take any action to receive the impugned goods in their own premises and to re-export the same within the required six month period. After giving the required documents and bonds, they cannot claim to be unaware of the clearance of the impugned goods from the Customs. Even after a lapse of nearly a year, they are seen to be threatening the suppliers and M/s. DAMCO that the latter should not attempt to re-export the cargo even though they themselves had executed the Customs bond to re-export the cargo within six months - Strangely the Customs authorities have not taken any action against the importers but have acted against the appellant-CHA in this case, without there being sufficient reason for such action - appeal is allowed.

Summary

Issues:
Violation of Regulation 13(a) and (d) by CHA leading to forfeiture of security amount.

Analysis:
The case involves an appeal by the Appellant, a Customs House Agent (CHA), against the forfeiture of a security amount of Rs. 25,000 due to alleged violations of Regulation 13(a) and (d). The Appellant's representative argued that the Appellants acted in good faith as they received import documents from M/s. DAMCO, agents for the importers M/s. Nelcast Ltd. The Appellants believed they had authorization from M/s. DAMCO to handle the customs clearance process on behalf of the importers. The goods were cleared and stored as per instructions from M/s. DAMCO, and subsequently handed over to another CHA. The Appellants maintained they acted legally and were compensated for their services.

The Appellant's representative contended that no penal action should be taken against the Appellants since no action was initiated against the importers or M/s. DAMCO, and the impugned goods were eventually exported. Conversely, the Departmental Representative argued that the Appellants lacked authorization from the actual importers, leading to complaints from the importers to Customs regarding non-receipt of the goods post-clearance. However, the complaint date and details were not provided in the impugned order.

Upon review, the judge found no evidence of mala fide intentions on the part of the Appellant-CHA. It is common practice for logistics companies to act as agents for importers and engage CHAs. The Appellant-CHA obtained necessary documents and bonds through M/s. DAMCO, indicating tacit authorization from the importers. The importers failed to take action to receive and re-export the goods within the stipulated period, casting doubt on their bona fides. Despite threats to suppliers and M/s. DAMCO, the importers did not fulfill their obligations. The judge noted the Customs authorities' failure to act against the importers while penalizing the Appellant-CHA without sufficient grounds.

Consequently, the judge ruled in favor of the Appellant, setting aside the impugned order and allowing the appeal. The judgment highlighted the lack of justification for penalizing the Appellant-CHA, given the circumstances and actions of the importers and logistics companies involved.