2016 (12) TMI 376 - AT - Customs

Revocation of the CHA Licence - forfeiture of the entire amount of security deposit - violations of provisions of CBLR 2013 - Embroidery Machine Needles imported from China - Evasion of ADD - mis-declaration of quantity of needles - needles was misdeclared as 20,000 pieces instead 1,00,00,000/- of pieces - undervaluation of goods - Held that - We find that there is no dispute that large scale evasion of anti dumping duty by the importer is established and also misdeclaration of the quantity and value of the goods. As regard the charges of violation of various regulations alleged and confirmed by the lower authority, we find that the appellant before accepting the job of clearance of the goods has taken authority letter from the importer. From authority letter and the verification of the signature by the bank, we do not see any difference in the signature. Moreover whether the signature is correct or not if there is any doubt the same cannot be established without getting it certified from the forensic expert which department has failed to do. Moreover there are other documents like certificate of registration from Maharashtra Sales Tax Department in favour of the importer M/s. Jai Ambey Impex also submitted therefore the identity of the importer is not under doubt. The entire objective of taking authority letter and KYC is for the purpose to establish the identity of the importer. In the present case the importer is very much existing all the time and he came forward to claim the goods imported therefore except mala fide intention on the part of the importer there is no doubt about the identity of the importer. As regard the dealing of CHA with the importer, we do not find anything malafide which led to offence of evasion of anti dumping duty. It is very important to note that when the appellant filed the Bill of Entry thereafter when they came to know about evasion of anti dumping duty and also there is a misdeclaration of quantity and value of the goods, he advise the importer for payment of anti dumping duty when he felt that the importer is not complying his advise. He immediately withdrawn himself as CHA vide his letter dt. 10.5.2013 i.e. within four days of filing Bill of Entry. As regard the mention by the Ld. Commissioner that the licence of the appellant was also revoked in the past, we are of the view that we cannot be influenced by any other case which is not before us. We have to consider the facts of the present case and if we found that in the present case no offence is established as per the facts and circumstances of this case then any other case cannot have a bearing in the present case. With our above discussion, we do not see that the conduct of the appellant is such that any of the violation of regulation as held by the Commissioner sustains. We are therefore of the considered view that from the facts and circumstances of the case, Revenue could not make out a case of revocation of the licence of CHA - We therefore set aside the order and allow the appeal.

Issues Involved:

1. Violation of Regulation 11(a) of CBLR, 2013.
2. Violation of Regulation 11(b) of CBLR, 2013.
3. Violation of Regulation 11(d) of CBLR, 2013.
4. Violation of Regulation 11(e) of CBLR, 2013.
5. Violation of Regulation 11(f) of CBLR, 2013.
6. Violation of Regulation 11(i) of CBLR, 2013.
7. Violation of Regulation 11(m) of CBLR, 2013.
8. Violation of Regulation 11(n) of CBLR, 2013.

Detailed Analysis:

1. Violation of Regulation 11(a) of CBLR, 2013:
The appellant was charged with not obtaining a proper letter of authority from the importer, as the signature on the authority letter did not match the actual signature verified by the bank. However, the appellant contended that they had indeed obtained the authority letter and other necessary documents to verify the importer's identity. The Tribunal found that the identity of the importer was not in doubt and that the appellant had taken reasonable steps to verify the importer's identity.

2. Violation of Regulation 11(b) of CBLR, 2013:
The appellant was accused of not personally or through an employee carrying out the job of clearance. It was alleged that Shri Manish Singh filed the bill of entry but did not go to the docks for clearance, which was managed by Shri P.P. Singh. The Tribunal noted that the appellant had withdrawn their services upon realizing the misdeclaration and potential duty evasion, indicating that they acted in a bona fide manner.

3. Violation of Regulation 11(d) of CBLR, 2013:
The appellant was charged with failing to advise the importer on the correct levy of anti-dumping duty and proper declaration of goods. The Tribunal found that the appellant had advised the importer to pay the anti-dumping duty and had withdrawn their services when the importer did not comply, thus acting in accordance with the regulation.

4. Violation of Regulation 11(e) of CBLR, 2013:
The appellant was accused of not exercising due diligence to ascertain the correctness of the information provided by the importer, as the declared quantity of needles was significantly lower than the actual quantity. The Tribunal found that the appellant had taken steps to verify the information and had withdrawn their services upon discovering the misdeclaration.

5. Violation of Regulation 11(f) of CBLR, 2013:
The appellant was charged with not being in direct contact with the importer and withholding information from their client. The Tribunal noted that the appellant had communicated with the importer and had advised them on the correct procedures, thus fulfilling their obligations under this regulation.

6. Violation of Regulation 11(i) of CBLR, 2013:
The appellant was accused of attempting to influence the conduct of customs officials. The Tribunal found no evidence to support this charge, as the appellant had withdrawn their services upon discovering the misdeclaration and had informed the customs authorities accordingly.

7. Violation of Regulation 11(m) of CBLR, 2013:
The appellant was charged with not discharging their duties with utmost speed and efficiency. The Tribunal found that the appellant had acted promptly upon discovering the misdeclaration and had withdrawn their services, thus fulfilling their obligations under this regulation.

8. Violation of Regulation 11(n) of CBLR, 2013:
The appellant was accused of not verifying the antecedents and correctness of the Importer Exporter Code (IEC) number and the identity of the client. The Tribunal found that the appellant had taken reasonable steps to verify the importer's identity and had acted in a bona fide manner upon discovering the misdeclaration.

Conclusion:
The Tribunal concluded that the appellant had acted in a bona fide manner and had taken reasonable steps to verify the importer's identity and advise them on the correct procedures. The Tribunal found that the charges against the appellant were not established and set aside the order of revocation of the CHA licence and forfeiture of the security deposit. The appeal was allowed.

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