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2025 (3) TMI 747 - AT - Customs


1. ISSUES PRESENTED and CONSIDERED

The core legal issues considered in this judgment are:

  • Whether the appellant, a Customs Broker, violated Regulation 10(n) of the Customs Broker Licensing Regulations, 2018 (CBLR 2018) by failing to verify the correctness of the Importer Exporter Code (IEC), Goods and Services Tax Identification Number (GSTIN), identity, and functioning of the client at the declared address using reliable, independent, authentic documents, data, or information.
  • Whether the revocation of the Customs Broker license, forfeiture of the security deposit, and imposition of a penalty on the appellant were justified based on the alleged violations.

2. ISSUE-WISE DETAILED ANALYSIS

Relevant Legal Framework and Precedents:

Regulation 10(n) of CBLR 2018 mandates that a Customs Broker must verify the correctness of the IEC, GSTIN, identity, and functioning of the client at the declared address using reliable, independent, authentic documents, data, or information. The regulation aims to ensure that Customs Brokers perform due diligence to prevent fraudulent activities.

Court's Interpretation and Reasoning:

The Tribunal analyzed the obligations under Regulation 10(n) and determined that the regulation requires verification through documents, data, or information that are reliable, independent, and authentic. The Tribunal emphasized that the Customs Broker is not required to physically verify the client's premises but can rely on official documents issued by government authorities.

Key Evidence and Findings:

The Tribunal noted that the appellant had verified the GSTIN and IEC through official documents and portals, which were presumed genuine under Section 79 of the Evidence Act, 1872. The Tribunal found no evidence that these documents were fake or forged.

Application of Law to Facts:

The Tribunal concluded that the appellant had fulfilled its obligations under Regulation 10(n) by verifying the GSTIN and IEC through official channels. The Tribunal found that the appellant's reliance on government-issued documents was reasonable and satisfied the requirement to verify the client's identity and functioning at the declared address.

Treatment of Competing Arguments:

The Tribunal considered the department's argument that the Customs Broker's role is critical in preventing misuse of export schemes. However, it found that the appellant had complied with the regulatory requirements by verifying the necessary documents. The Tribunal rejected the notion that the Customs Broker should verify the correctness of government-issued documents beyond their authenticity.

Conclusions:

The Tribunal concluded that the appellant did not violate Regulation 10(n) as alleged. The Tribunal found that the revocation of the license, forfeiture of the security deposit, and imposition of a penalty were not justified based on the evidence presented.

3. SIGNIFICANT HOLDINGS

Core Principles Established:

The Tribunal established that a Customs Broker fulfills its obligations under Regulation 10(n) by verifying the authenticity of government-issued documents and does not need to conduct physical verifications of the client's premises. The Tribunal emphasized that the responsibility does not extend to verifying the correctness of the issuance of such documents by government authorities.

Final Determinations on Each Issue:

The Tribunal set aside the impugned order, finding that the appellant did not fail in discharging its responsibilities under Regulation 10(n). The Tribunal allowed the appeal, granting consequential relief to the appellant.

 

 

 

 

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