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TMI Blog2014 (3) TMI 883X X X X Extracts X X X X X X X X Extracts X X X X ..... it of prohibitions on export, needs to be dealt with severely - Penalty imposed is low considering the value of goods. - penalty increased from ₹ 3,00,000/- to ₹ 5,00,000/- Penalty on CHA and revocation of his licence - Held that:- Since he was not taking even the minimum care to avoid this type of incident from happening there is an omission on his part which is punishable under section 114 (i) of the Customs Act, 1962. Such an approach needs to be dealt with severely and the penalty as reduced by the Commissioner (Appeal) is not commensurate with his omissions of duties cast on him by CHALR, 2004. - If the omissions of duties cast on him have rendered any goods liable to confiscation penalty under section 114 (i) is justified. - penalty increased from ₹ 3,00,000/- to ₹ 5,00,000/- Penalty on G. Ravi, Proprietor of M/s. Deepak Logistics, Tuticorin. Shri Ravi had obtained an H card (Identity cum Authorization card) issued under Regulation 19(6) of CHLAR 2004 - Held that:- Shri Ravi is a person who signed Annexure-A form for export of goods by Shri. George using blank signed forms given by Shri Rama Theena Thayalan. - he was aware of the manipulation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on examination, it was found that the container was fully stuffed with red sanders wood. Malaysian Customs sent back the container to Tuticorin after putting a onetime seal No. 176853 and the same was endorsed vide their note dated 31.07.2008. 3. The Directorate of Revenue Intelligence, conducted further investigations, and it was found that one Shri George, S/o. Rathinasamy, residing at No. 6E, Selvitzer 1st Street, Tuticorin -628002, had played the main role in the illicit export of the said prohibited goods. He had contacted M/s. Kumari Coir Products had offered consideration to Shri. S. Chandrasekhar, the proprietor of the firm, to allow Shri. George to use the name and Import Export Code of M/s. Kumari Coir Products to export Coco Peat, and made all arrangements such as i) procurement of the declared cargo, ii) stuffing of the declared cargo under Central Excise Supervision, iii) using the IEC of M/s. Kumari Coir Products, iv) engaging the Custom House Agent for Customs clearance work and for booking the container v) transportation of the goods and made payments for all these works. It appeared that Shri Muthu, Manager-cum-Driver of the lorry TN 23 0420 had played a vital r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ucts. Shri Rama Theena Thayal, failed to exercise due diligence as prescribed in the Customs House Agents Licensing Regulations, 2004, and thus resulted in export of prohibited goods from the country by an unscrupulous person. So penalty under section 114(i) of Customs Act and 117 of Customs Act were proposed in the SCN against this appellant. 6. The next person concerned is Shri G. Ravi, Proprietor of M/s. Deepak Logistics, Tuticorin. Shri Ravi had obtained an H card (Identity cum Authorization card) issued under Regulation 19(6) of CHLAR 2004 claiming himself to be an employee of M/s. Victor Freight Forwarders, Tuticorin which was a licensed CHA firm with Shri Rama Theena Thayalan as proprietor. Shri Ravi had paid Rs. 1 lakh as deposit money to Shri Rama Theena Thayalan and was also paying Rs. 10000 per month since Oct 2007 for using the CHA license of Shri Rama Theena Theyalan. In fact, he was handling the entire matter of filing the shipping bill, getting the goods cleared etc. by using a blank Annexure-A forms signed by Shri Rama Theena Thayalan. Shri G Ravi filed Shipping Bills without verifying the credentials of M/s Kumari Coir Products and he did not get any authorizati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case of Sri Ram Vs. State of Uttar Pradesh. 10. Opposing the submissions of the three persons Ld. A.R. for Revenue submits that Shri. Chandrasekharan allowed Shri. George to export goods using the name and Import Export code of M/s.Kumari Coir Products. He was basically dealing with coir products and had no experience in export of coco peat. He had not verified the antecedents of Shri. George. The whole transaction by its very nature shows that Shri. Chandrasekharan has wantonly allowed his name to be used for export of prohibited goods by a person who is not traceable and hence Shri. Chandrasekharan is responsible for allowing others to use his I.E. code for export of goods which was found to be prohibited goods. Renting of his name and IEC for use by unscrupulous elements like Shri George is an act of commission for which penalty can be imposed under section 114 of the Customs Act. The section does not have any condition that penalty is leviable only if he knew that prohibited goods were going to be smuggled using his name. He points out that this was not a case where his name and IE code was used without his knowledge. The claim is only that he did not know about the misch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibited item by Shri. George. Acting as a proxy for non-traceable persons and allowing the laws of the country to be flouted is not a matter to be encouraged. An argument that IE codes are assigned so that the code can be rented out for consideration is not an acceptable argument at all. By his own statement two consignments were exported in the past also. Such persons trying to enrich themselves by taking benefit of prohibitions on export, needs to be dealt with severely. The penalty upheld by the Commissioner (Appeal) is low considering the value of goods. So I increase the penalty to Rs. 5,00,000/- (Rupees Five lakhs only) by partially allowing the appeal filed by Revenue and rejecting the appeal filed by Shri. S. Chandrasekharan. 15. I find Shri. Rama Theena Thayalan is not a bonafide CHA at all. He was just collecting rental income out of his license. Risk to the countrys interest caused by his action was of no concern to him. There was statutory obligation on him to know the clients for whom he was acting and such obligation was not discharged. Since he was not taking even the minimum care to avoid this type of incident from happening there is an omission on his part which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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