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TMI Blog2014 (12) TMI 531X X X X Extracts X X X X X X X X Extracts X X X X ..... nt CHA from the exporter, we hold that the charges of violation of Regulation 13 (a) are proved. Employee has been doing the job of clearance on instructions from the exporter during the course of his employment and therefore, keeping in mind the ratio laid down in case of Worldwide Cargo (2006 (11) TMI 281 - BOMBAY HIGH COURT), we are of the view that the principles of vicarious liability of the master will certainly apply. Accordingly, the charges of violation of Regulation 19 (8) are also proved. Act provides for two types of action i.e. (i) for imposition of aiding and abetting the importer/exporter in smuggling of the goods, (ii) and the other action is contemplated under CHALR. As such merely on the ground that the ld. Commissioner set aside the penalty, is not a ground alone for quashing the order or revocation when the CHA has been found to indulge in gross misconduct and contravening the various provisions of Regulation under CHALR, 2004. Commissioner has rightly revoked the CHA licence and forfeiture of their security deposit. The said decision having been arrived at by the ld.Commissioner after taking into consideration all relevant materials and the said Regula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said interception. On query, it revealed that the shipping bill in respect of the above export consignments, were filed by M/s S. C. Ghosh Company (India) Pvt. Ltd., i.e. the Appellant. During the course of investigation, the Officers recorded the statement of various persons. Shri Jaladhar Bose, Jetty Sircar, the employee of the Appellant, CHA firm, in his statement admitted to have tampered the ARE-1, bearing Sl.No.15 dated 17.02.2004. Shri Arup Kumar Mukherjee, one of the persons, dealing with the processing the documents, in his statement dated 09.03.2004, admitted that he had worked earlier as a Custom House Agent (CHA) for two years, but after the expiry of the licence in 2000-01, he lost his job and thereafter, with the help of a broker, he has been doing the clearance job using the stamp of M/s N. N. Bose Nephew and M/s S. C. Ghosh Company (India) Pvt. Ltd. He stated that he was associated with the firm, M/s Shiva Trading Company and that the said firm was engaged in processing of customs clearance of import and export cargo by using the stamp of CHA firm, M/s S. C. Ghosh Company (India) Pvt. Ltd.. He stated that in this case, he approached by one Shri Supriya Ku ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 2004. The CHA was directed to submit its explanation before the enquiry officers. The CHA submitted a reply on 11.01.2005 and appeared for personal hearing before the enquiry officers on 02.07.2005. After going through the materials on record and submissions made by CHA firm, the enquiry officers found that the charges made in Regulation 13 (a) 19 (8) of the CHALR, were proved. Thereafter, the matter was taken for adjudication and during adjudication, the ld. Commissioner found that the CHA had violated the provisions of Regulation 13 (a) and that of Regulation 19 (8) of the CHALR, 2004, therefore, revoked the licence and forfeited the security deposit of the CHA. 4.1 The ld. Advocate appearing for the Appellant, had submitted that the Appellants were an authorized Shipping and Clearing Agent since 1914 having a licence No.G-1. He submitted that during the ordinary course of business, the Appellants had undertaken job of clearing of three export consignments of M/s Brij Spinners, Ludhiana. He submitted that the invoices and packing lists of the impugned consignments were received by the Appellants from the respective exporter, accordingly, shipping bills were prepared and fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Advocate submitted that in case of revocation of the licence, proportionality is required to be looked into since such proportionality is of great significance as action is under a fiscal statute and may ultimately lead to a civil death. He submitted that the punishment, therefore, should be commensurate with offence as held in the following judgments: (i) Falcon Air Cargo Travel (P) Ltd. Vs. Union of India : 2002 (140) ELT 08 (Delhi); (ii) Falcon Air Cargo Travel (P) Ltd. Vs. CC, New Delhi : 2002 (141) ELT 284 (Tri.-Del.); (iii) CC (General), Mumbai : Rinku Shipping Agency : 2010 (254) ELT 445 (Bom.); (iv) Vipil Pranlal Doshi Vs. C.C. (General), Mumbai : 2012 (279) ELT 427 (Tri.-Mumbai); (v) Shri Venkatesh Shipping Service Pvt. Ltd. Vs. Union of India : 2013 (287) ELT 266 (Bom.); (vi) Samrat Shipping Services Vs. CC (General), Mumbai : 2007 (213) ELT 103 (Tri.-Mumbai); (vii) T. V. Shanmugam Vs. CC, Chennai : 2006 (199) ELT 700 (Tri.-Chennai) (viii) Smita International Vs. CC (General), Mumbai : 2004 (167) ELT 219 (Tri.-Mumbai); (xi) Ashiana Cargo Services : 2014 (302) ELT 161 (Del.) 4.6 It is submitted th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve signed the blank declaration and dock challans in respect of the impugned consignments and handed over the same to an unauthorized persons, namely, Shri Subhas Chakraborty for processing of export documents. He, therefore, submitted that the ld. Commissioner has rightly revoked their licence and forfeited the security deposit. 5.3 The ld. A.R. submitted that as the CHA is required to have an authorization from his client, but they failed to do so and therefore, they have followed the Regulation 13 (a) of CHALR, 2004. He submitted that the ld. Advocate has pleaded that as the Appellant CHA has filed the export documents on the basis of invoice and packing lists received from the exporter, the same can be considered as substantive compliance of Regulation 13 (a) as held in case of P. P. Dutta (supra) and other case laws. It is the submission that the facts of the present case are distinguishable in as much as the shipping bills was never signed by the exporter and that it is the categorical admission on the part of the Managing Director of CHA that he did not know the exporter. He relied upon a judgement in the case of Baraskar Brothers Vs. Commr. of Customs (General), Mumbai : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... igh Court of Calcutta in case of Ocean Shipping and Clearing Agency (supra). It is submitted that in the present case, the proceedings are not with reference to suspension, but the matter relates to revocation of the licence after due enquiry followed by the adjudication proceedings. Moreover, in case of Ocean Shipping Clearing Agency (supra), the Hon'ble High Court did not interfere with the order of suspension and asked the respondent party to complete the investigation within 45 days of the order. It is submitted that in case of Subhas Guha Sarkar (supra), the suspension was quashed by the Hon'ble Court for not granting pre-decisional hearing that the Customs Authorities were given an opportunity to such proceedings as they may deem fit and proper in compliance with Regulation 22 of CHALR, 2004. He further submitted that in case of Mathre Sons (supra), the facts were different and not akin to the present case. 5.7 He submitted that in the present case, the CHA did not obtain the authorization from the exporter, failed to supervise his employee, allowed his stamp to be used by an unauthorized person for a monetary consideration, handed over blank declaration and do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revocation of licence, the CHA would suffer, it must not be lost sight that it is right of citizen to carry out his business and profession, it is subject of reasonable restrictions and conditions, which are stipulated under CHALR. 5.9 As regards the contention of the ld. Advocate that the penalty in another proceedings initiated against the Appellant, CHA for abatement was set aside by the Commr. (Appeals), revocation merits to be set aside, it is the submission that the Commr. (Appeals) observations in a different set of proceedings against the Appellants cannot be a ground for setting aside the revocation, which has been done in the proceedings initiated against the Appellant CHA for violation of the various obligation imposed on him under CHALR, 2004. 6.1 We find that the various obligations have been put on the CHA under CHALR, 2004. Regulation 13 (a) provides that A Custom House Agent shall obtain an authorization from each of the Companies, firms or individuals by whom he is for time being employed as Custom House Agent and produce such authorization whenever required by the Deputy Commissioner of Customs or Assistant Commissioner of Customs . Regulation 19 (8) p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estioned by the Customs and no dispute raised about the authorization while clearing the consignments and therefore, the CHA alone cannot be punished. We find that various case laws cited by the ld. Advocate are not relevant to the present case in as much as unlike the cases cited by the ld.Advocate, in the present case the export documents were not signed by the exporter. The invoice list and the packing list on the basis of which shipping bills were filed, were not received by the CHA from the exporter but from a third person, namely, Shri Arup Kumar Mukherjee. As no authorization could be produced by the Appellant CHA from the exporter, we hold that the charges of violation of Regulation 13 (a) are proved. 6.3 As regards failure to supervise the job of the employee, we find that the said employee has been doing the job of clearance on instructions from the exporter during the course of his employment and therefore, keeping in mind the ratio laid down in case of Worldwide Cargo (supra), we are of the view that the principles of vicarious liability of the master will certainly apply. Accordingly, the charges of violation of Regulation 19 (8) are also proved. 6.4 The ld. Advo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e regarding falsifying the photocopy of Identity Card by one of their employee had exonerated the appellants. The Commissioner, in the impugned Order, has held them responsible for the conduct of employee. In respect of second show cause notice, the Second Inquiry Officer has concluded that the Appellants did give the business to M/s. Pinks Cargo Agency. However, he had also opined that it cannot be said with certainty that they connived with them to append false declaration as alleged. The documents bear the signatures of Exporter as well and the fact that the , beneficiary of the drawback amount were to be the Exporters M/s. Ski Air Exports Pvt. Ltd. . The Adjudicating Authority has found the Appellant liable as the Shipping bills had been signed by the Appellant. We also observe that the Inquiry Officer had also suggested as under: While adjudicating, the adjudicating authority may please take into consideration the amount of penalty imposed on the Exporter, representative of M/s. Pinks Cargo Agency and the CHA by the Commissioner of Customs ICD since the same do reflect the complicity and the extent of abatement and connivance. As against above, in the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o, ordered to revoke CHA licence and also to forfeit the security deposit found to be too harsh. However, the Tribunal noted that such arrangements restricted to facts of the case and not to be treated as precedent. The relevant Para of this order is reproduced below: 32. In view of this we are inclined to hold that the interest of justice would be met if the CHA Licence then held by the said company could be restored in favour of the said company with effect from 1-10-2012. By this arrangement, the said company would be without a CHA Licence from 19-8-2008 till 30-9-2012 which would mean that the total period for which the said company would be out of business will be 4 years and 7 months. As regards the forfeiture of the security deposit, we are inclined to confirm the said order. In our view, the aforesaid arrangement would meet the ends of justice. We will also like to clarify that aforesaid arrangement is restricted to facts of this case and cannot be treated as precedent. In case of Samrat Shipping Services (supra), there was no concrete evidence of misutilization of licence by the employee. In the present case, Shri Jagladhar Bose, employee of the CHA has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... res infringement of human rights to the least restrictive alternative. ['Judicial Review of Administrative Action1; (1995); pp. 601-605; para 13.085; see also Wade Forsyth; 'Administrative Law'; (2005); p.366]. 12. In the case of Chairman M.D. V.S.P, Ors. v. Goparaju Sri Prabhakara Hari Babu, 2008 (2) G.L.H. 146, the Hon'ble Supreme Court observed thus:- 17. Once it is found that all the procedural requirements have been complied with, the Court would not ordinarily interfere with the quantum of punishment imposed upon a delinquent employee. The Superior Courts only in some cases may invoke the doctrine of proportionality. If the decision of an employer is found to be within the legal parameters, the jurisdiction would ordinarily not be invoked when the misconduct stands proved. {See Sangeroid Remedies Ltd. v. Union of India Ors. [1999 (1) SCC 259 - 1998 (103) E.L.T. 5 (S.C.)]}. 17.1 The High Court in exercise of its jurisdiction under Article 226 of the Constitution of India also cannot, on the basis of sympathy or sentiment, overturn a legal order. 13. The Hon'ble Supreme Court, in the recent case of Chairman-cum- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pra); the Appellant CHA allowed his stamp to be used by the unauthorized persons in the name of Shri Arup Kumar Mukherjee, who admitted to have taken the job for monetary consideration of ₹ 7000/- per container, subletting of licence for monetary consideration of ₹ 150/-per shipping bill has been considered to be serious infraction of of CHA licence in case of H. B, Cargo Services (supra). The Appellant CHA has failed to supervise his employee, who was found to have indulged in tampering the ARE 1. From the facts and circumstances of this case and in the light of the judgements cited above, we are of the view that the revocation of licence and forfeiture of their security deposit is justified. 6.8 The ld. Advocate has submitted that in view of the doctrine of proportionality the Hon'ble High Court of Delhi in case of Ashiana Cargo Services (supra), set aside the revocation of CHA Licence. On perusing the above order, we find that the Hon'ble Court while holding so, has observed as under: 10. Beginning with the facts, there is virtually no dispute. There is a concurrent finding of fact by the Commissioner and the CESTAT that the Appellant did ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the provisions of certain enactments etc. Therefore the grant of licence lo act as a Custom House Agent has got a definite purpose and intent. On a reading of the Regulations relating to the grant of licence to act as Custom House Agent, it is seen that while Custom House Agent should be in a position to act as agent for the transaction of any business relating to the entry or departure of conveyance or the import or export of goods at any customs station, he should also ensure that he does not act as an Agent for carrying on certain illegal activities of any of the persons who avail his services as Custom House Agent. In such circumstances, the person playing the role of Custom House Agent has got greater responsibility. The very prescription that one should be conversant with the various procedures including the offences under the Customs Act to act as a Custom House Agent would show that while acting as Custom House Agent, he should not be a cause for violation of those provisions. A CHA cannot be permitted to misuse his position as a CHA by taking advantage of his access to the Department. The grant of licence to a person to act as Custom House Agent is to some extent to as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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