2012 (11) TMI 570 - AT - Customs

Revocation of CHA Licence - importer imported 43 consignments of Hot Melt Glue Sticks - Out of 43 consignments, seven consignments have been sold by the importer on high seas to M/s. East India Trading Co. alleged that they have not obtained the authorization from East India Trading Co. & C.S. Enterprises Held that - Import documents/declaration have been duly signed by the importer and the same were presented before the Customs authorities, and have not objected to the same and did not ask the appellants to produce authorisation from the importer it is the joint responsibility of the proper officer and the CHA to obtain the authorisation from the importer and if it is not asked by the proper officer from the CHA to produce the authorization. Therefore, it is presumed that the authorisation is not required. Withdrawal of revocation of CHA licence ordered subject to forfeiture of the security amount of Rs.10,000/-

Summary

Issues:
Revocation of CHA Licence due to lack of authorization from importers.

Detailed Analysis:

Issue 1: Revocation of CHA Licence
The appellant filed an appeal against the revocation of their CHA Licence due to not obtaining authorization letters from importers, M/s. East India Trading Co. and M/s. C.S. Enterprises. The appellant argued that the import documents were signed by the importers, implying authority for CHA clearance. Citing various legal precedents, the appellant contended that no formal authorization letter was required as long as import documents were signed by the importers. The appellant also highlighted that the value of goods for certain clients was lower, indicating no knowledge of undervaluation. The appellant emphasized that the suspension of the license for over three years was already a significant punishment. On the other hand, the respondent argued that the appellant failed to produce authorization letters and did not receive any documents/payment from the importers, leading to the revocation. The respondent cited legal judgments supporting the revocation of the license for breaching statutory regulations.

Analysis Outcome:
Upon careful consideration, the Tribunal found that the main allegation against the appellant was the lack of authorization from the importers. However, since the import documents were signed by the importers and not objected to during clearance, the Tribunal deemed it as implied authority for CHA clearance. Referring to legal precedents, the Tribunal concluded that the authorization was not required if not specifically demanded during clearance. The Tribunal also reviewed a similar case involving Standard Shipping Agency where the revocation was ordered but later modified. Drawing parallels, the Tribunal decided to withdraw the revocation of the CHA Licence of the appellant subject to the forfeiture of a security deposit, citing fairness and consistency in punishments across cases.

Judgment Outcome:
The appeal was allowed, and the revocation of the CHA Licence was withdrawn subject to the forfeiture of a security deposit of Rs. 10,000. The decision was pronounced in court on 20-12-2011.