2024 (7) TMI 322 - AT - Customs

Revocation of Custome Broker License - levy of penalty - violation of Regulation 10(a), 10(b), 10(d) 10(n) of CBLR, 2018 - re-determination of value - confiscation of the goods meant for export - rejection of Drawback claim - imposition of penalty upon the exporter. Violation of Regulation 10(a) of the CBLR 2018 - HELD THAT - The CB is under obligation to obtain an authorization from exporter/importer. The regulation does not suggest that the CB is required to verity the signature of the exporter/importer in the said Authorization - In the present case, Mr. Mohammed Ifran, Proprietor of M/s. Sameera Overseas i.e. the exporter, has admitted that he has provided all the documents to the CB. It is observed that the issuance of Authorization and supply of the export documents by the exporter is not in dispute. Accordingly, the violation of Regulation 10(a) of CBLR, 2018, as alleged in the impugned order is not established. Violation of Regulation 10(b) of CBLR, 2018 - HELD THAT - The job has been undertaken by Shri Aniruddha Mukherjee, who is an employee of the appellant company. There is no dispute on this. Thus, it is held that it cannot be presumed that the CB had undertaken the job of clearance through any unauthorized person. Accordingly, it is held that there is no violation of Regulation 10(b) of CBLR, 2018. Violation of Regulation 10(d) of CBLR, 2018 - HELD THAT - The CB works as a mere facilitator and files such documents, as provided by the exporter, before the Customs Authority who are supposed to examine the same before completion of assessment. In this case, the exporter, during investigation, admitted the fact of providing export documents by himself. The value of the goods cannot be expected be determined by the CB at any circumstance. Accordingly, it is held that the violation of Regulation 10(d) of CBLR, 2018 on the part of the appellant CB is not established. Violation of Regulation 10(n) of CBLR, 2018 - HELD THAT - In the present case, it is observed that the IEC of the exporter is valid and the same was verified by the CB from the DGFT website, which is reliable, independent and authentic data and information. Further, in this case, the exporter had duly joined the investigation and admitted his act of export. As such, identity and functioning of the exporter is not in dispute. Hence, there is no violation of Regulation 10(n) of CBLR, 2018 on the part of the appellant CB. The allegation in the impugned order that the CB has violated Regulation 10(a), 10(b), 10(d) 10(n) of CBLR, 2018, is not substantiated with evidence. Accordingly, it is held that the impugned order revoking the CB licence of the appellant on the ground of violation of the above said Regulations is not sustainable. Accordingly, the penalty imposed on the appellant CB is also not sustainable. The impugned order set aside - appeal allowed.

Summary

Issues: Revocation of Customs Broker License under CBLR, 2018 and imposition of penalty.

Analysis:
1. The appellant, a Customs Broker, appealed against the revocation of their license and imposition of a penalty under CBLR, 2018. The case involved the clearance of export consignments of Cow Leather Wallet and subsequent investigations revealing alleged overvaluation by the exporter.

2. The adjudication process led to the dropping of penalty imposition on the appellant by the Ld. Additional Commissioner. However, observations in the Order in Original suggested violations of Regulation 10(a), 10(b), 10(d), and 10(n) of CBLR, 2018 by the Customs Broker.

3. The appellant contested the violations, arguing that the observations were beyond the scope of the original show cause notice. They refuted the allegations under each regulation:
- Regulation 10(a): No requirement to verify exporter's signature in the authorization.
- Regulation 10(b): Job undertaken by an employee with a pending license application, not unauthorized.
- Regulation 10(d): CB's role as a facilitator, not responsible for exporter's mis-declaration.
- Regulation 10(n): Verification of exporter's details through reliable sources like DGFT website.

4. The Tribunal noted the lack of evidence supporting the alleged violations and the absence of opportunities for the appellant to counter the allegations. The impugned order was found unsustainable due to unsubstantiated claims against the Customs Broker.

5. After detailed analysis, the Tribunal set aside the impugned order, allowing the appeal and ruling the penalty imposed on the appellant as unsustainable. The decision was made in favor of the appellant with consequential relief as per law.