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2015 (10) TMI 494 - AT - CustomsPenalty u/s 114(ii) - Shortage of goods found - Misdeclaration - Held that - Under the facts and circumstances that is no lapse on the part of the CHA. The CHA acted on the instructions of the exporter and documents given. He had identified exporter before the Customs Authorities. Further the said exporters have accepted the responsibility for the mis-declaration in the sq. ft. of the carpets under export. Further no elements of aiding and abetting have come on record. Further in view of the goods subjected to examination and the L.E.O. issued, the CHA cannot be held responsible for lack of duty in mis-declaration of sq. ft. Area of the carpets under export, which cannot be made out by visual examination and the same have come on record only at the stage of second examination where the consignment was opened and 100% measured. Thus, I hold that the CHA is not guilty of aiding and abetting. I further hold that the CHA had the authorisation which it appears was not produced due to clerical error, but the fact has been stated and accepted by the exporter. That the penalty retained in the impugned order is set aside. - Decided in favour of Appellant.
Issues:
1. Reduction of penalty under Section 114(ii) of the Customs Act, 1962 by the Commissioner (Appeals). 2. Allegations of mis-declaration and penalty imposition on the Customs House Agent (CHA). 3. Appeal challenging the penalty imposed on the CHA. Issue 1: Reduction of Penalty under Section 114(ii) of the Customs Act, 1962 The appellant, a CHA, appealed against the Order-in-Appeal reducing the penalty imposed under Section 114(ii) of the Customs Act, 1962 from Rs. 50,000 to Rs. 30,000. The Commissioner (Appeals) had reviewed the penalty imposed by the Commissioner of Customs (Appeals) and decided to lessen it. The appellant contested this reduction, leading to an appeal before the Tribunal. Issue 2: Allegations of Mis-declaration and Penalty Imposition on the CHA The case involved the CHA filing 5 shipping bills on behalf of an exporter, declaring the area of woollen and polyester carpets for export. Subsequent examinations revealed discrepancies in the declared and actual areas of the carpets in the consignments. The exporter admitted to mis-declaration, leading to a show-cause notice for confiscation and penalty imposition under Sections 114(i) and 114(iii) of the Customs Act. The CHA contested the notice, stating they relied on the exporter's documents and had no role in the mis-declaration. The adjudication resulted in the cancellation of the let export order and imposition of a penalty of Rs. 50,000 on the CHA. Issue 3: Appeal Challenging the Penalty Imposed on the CHA The appellant appealed the penalty before the Commissioner (Appeals), who partially allowed the appeal by reducing the penalty to Rs. 30,000. The Commissioner (Appeals) noted the CHA's lack of authorization from the exporter and upheld part of the penalty. The appellant challenged this decision before the Tribunal, arguing that the CHA acted based on provided documents, and the exporter was solely responsible for the mis-declaration. The appellant cited legal precedents to support their contention that the CHA's role is limited to document submission without verifying the contents. In the final judgment, the Tribunal found no lapse on the part of the CHA. It noted that the CHA acted on the exporter's instructions and identified the exporter before Customs Authorities. The exporter admitted to mis-declaration, absolving the CHA of aiding and abetting. The Tribunal emphasized that the CHA's responsibility does not extend to verifying the contents of export documents. Consequently, the Tribunal set aside the penalty imposed on the CHA, allowing the appeal and dismissing the Revenue's cross objection. The appellant was entitled to consequential benefits as per the law.
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