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TMI Blog2016 (3) TMI 217X X X X Extracts X X X X X X X X Extracts X X X X ..... rudence. No facts are coming on record to indicate that the appellant-CHA have aided and abetted the importers in evasion of customs duty. However, evidences which have come on record indicate that the importers have misled successfully the CHA, Revenue and Bank by fabrication and forgery of documents being minor manipulation, which is not easily made out unless one compares the documents with the investigative eyes. The original and forged documents look all the same at the first glimpse. Only on careful scrutiny the difference and/or manipulation committed could be noticed. Therefore, in absence of any finding of aiding and abetting, the charges can not be hold under Regulations 13(d) & (e). The act of forgery of official documents or signatures were committed by the importer. Therefore, it cannot ipso facto form the ground for charging CHA under CHALR, 2004 for violation of Regulation 13(i). Some inadvertence or lack of efficiency took place on part of the CHA and that is because of a regular dealing with the said importers and not because of gross negligence or misconduct in discharge of duty. Therefore, the appellant needs to be visited with some penal action in view of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... try were investigated). In the month of July, 2009, the DRI, Ludhiana sought copies of various import documents relating to these importers handled by the appellant, to which the appellant complied. Further, relevant import documents were also called for from the State Bank of India, Ludhiana (importer s Bank), M/s. APL Shipping Lines, JNPT, Mumbai. During the scrutiny of those documents, gross irregularities such as misdeclaration in description, quantity as well as undervaluation were found. It was also found that the importers had fabricated Bills of Entry by forging and fabricating signatures of Customs Officers and presented them to their Banks. It was alleged that CHA - M/s. Ratnadip Shipping Pvt. Ltd. (appellant) was aware about the actual description as well as actual quantity of goods imported which is evident from the original copy of Bill of Lading bearing the details of the actual description and quantity, as the appellant on the backside of Bill of Entry had appended the same by putting signature and rubber stamp. However, the appellant-CHA had filed Bills of Entry with wrong description as well as less quantity of the imported goods. Thus, it appeared to Revenue that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts such as invoice, B/L., certificate of original, etc., retained by the JNCH at the time of clearance of the goods under Section 47 of the Customs Act, 1962 should be made available. (iii) That the learned Inquiry Officer had accepted the request of the charged CHA for furnishing copies of Bills of Entry along with related documents retained at the time of clearance of the goods and accordingly the Inquiry Officer sought documents from J.N. Customs House. However J.N. Customs House had forwarded copy of only one Bill of Entry No. 760363, dated 15-5-2007 (as per Daily Order Sheet No. 4) and rest of the documents are not made available during the course of inquiry. (iv) That during the course of Inquiry, the department has examined Shri Deepak Agarwal as a prosecution witness and the deposition of Shri Deepak Agarwal is recorded in Daily Order Sheet No. 5, dated 9-10-2012. (v) That the defence has examined one witnesses Shri Sunil Soma Shingwan and his deposition is annexed to Daily Order Sheet No. 6, dated 15-10-2012. (vi) That the regular inquiry was closed on 15-10-2012 and the Presenting Officer was given 10 days time to file his final report in the matter and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, 1962 resulting in evasion of Customs Duty to the tune of crores of rupees. The importers even fabricated and forged some of the bills of entry showing actual quantity, description and actual value and presented the same to their bank and in case of High Seas Seller (M/s. Arisudana Industries Ltd.) to his bank for the purpose of repatriating remittances representing actual value of the import consignments against L.C. or otherwise to the foreign supplier. In some cases they even forged signatures of Customs Officials on such forged bills of entry. The differential money on account of undervaluation i.e. the actual import price negotiated with the overseas suppliers and the import price declared before the Indian Customs was being paid by these importers either through the hawala operators or from their bank accounts by submitting fabricated documents such as bills of entry other than that, presented to the Customs in India. 3. As per the show cause notice under the provisions of CHALR, the appellant was called upon answer the following 4 articles of charges : - (i) Article of charge 1 - Regulation 13(d) of CHALR, 2004 states that a CHA shall advise his clients to com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r they used to compare only the Container No. and Bill of Lading No. with copy received earlier by them through fax. The ld. Commissioner further observed that it has been further stated by Mr. Deepak Aggarwal in his deposition that due to oversight they have failed to compare invoice/Bill of Lading received by fax with original receipts through courier and they have failed to correct their mistake in respect of description of goods and accordingly they have failed to perform the duties of the CHA. It has been further observed that the CHA claims to have compared the fax copy with the original subsequently received through courier, but it appears the CHA in fact have failed to compare. Although, the CHA preserved the fax copy on the basis of which check lists was filed, but they failed to keep copy of original Bill of Lading, which has been endorsed and forwarded by the appellant to the shipping line. It further appeared to ld. Commissioner that the CHA was aware of the mis-declaration under Bill of Entry, who had denied the allegation to save the importers. It is further observed that the appellant have erred in filing the check list on the basis of fax copy without waiting for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y a man of ordinary prudence. It is further observed that the appellant-CHA are handling clearance of several consignments relating to fabrics. Accordingly, the presumption was drawn that the omission on part of the appellant is deliberate, indicating to their complicity with the importers in aiding and abetting the clearance in irregular manner. Accordingly, these charges were held to be established. 3.2 So far the second charge is concerned under Regulation 13(e) of the CHALR, which provides that CHA shall exercise due diligence to ascertain the correctness of the information, which he imparts to the client with reference to any work related to clearance of cargo or baggage, it appeared to the Revenue that the facts noted herein above i.e. the director of appellant Mr. Deepak Aggarwal was fully aware with difference between acrylic fiber and acrylic tow and different classification and was also aware that the rate of duty on the acrylic fiber and acrylic tow was same, however, at some point of time acrylic fiber imported from the Thailand was subjected to anti-dumping duty. It appeared to the Revenue that the appellant have colluded with the importer in the illegal act of evas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arance in spite of knowing about the facts, points to their complicity with the importer and accordingly, it was held that the appellant have violated the provisions of Regulation 13(e) of the CHALR. 3.3 So far the third article of charge under Regulation 13(i) of the CHALR, which provides that the CHA shall not attempt to influence the conduct of any official or his subordinates by the use of threat, false accusation, duress or the offer of any special inducement or promise of advantage or by the bestowing of any gift or favour or other thing of value. This charge was held not sustainable in view of the defence that there is no allegation on the appellant that they have attempted to influence the conduct of any official or its subordinates in any manner and nothing has been brought on record to the effect that the appellant-CHA have resorted any malpractice while conducting business. The learned Commissioner found that the charge has been framed in the first place, due to the fact that forgery of documents and signatures were committed by the importer, and the CHA have been sought to be charged under the CHALR. However, nothing has come on record to have remotely suggested viol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not acceptable as the CHA have long association with the importer. The appellant failed to take the notice of discrepancies in the original invoice/Bill of Entry vis- -vis the fax copy based on which the Bill of Entry was filed. This evidence points to connivance of the CHA with importer. This issue is not yet decided in the main case along with the importer where the show cause notice under Section 124 of the Customs Act has been issued. Accordingly, this charge is held to be established. The learned Commissioner has further observed that the matter is serious enough to ascertain strict action against the CHA and relied on the ruling of the Hon ble Bombay High Court in the case of Commissioner of Customs v. Worldwide Cargo Movers - 2002 (139) E.L.T. 498 (Tri.) (sic) and the ruling of the Hon ble Madras High Court in the case of Shri Kamakshi Agencies v. CCE - 2001 (129) E.L.T. 29 (Mad.). In exercise of his powers under Regulation 22(7), 20(i) of the CHALR, 2004 have ordered for revocation of the CHA license and have also ordered forfeiture of entire security deposit of the appellant. 4. Being aggrieved, the appellant-CHA is in appeal before this Tribunal. 5. The learned Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 027690295 - as per the copy of invoice and Bill of Lading received by the appellant-CHA, the description is acrylic tow, quantity 51,824 kg 57,753 kg. @ 1.41 US$ per kg., whereas the actual Bill of Entry received by the Revenue from the shipping line and bank shows the description as acrylic fiber , even in the certificate of origin it is from Thailand and description is acrylic tow, it is also thereon the High Seas Sales agreement. 5.3 With respect of Bill of Entry 811220, dated 3-5-2008 relating to Bill of Lading No. 27690996 as per the invoice received by the appellant-CHA shows the description as acrylic tow, whereas in the Bill of Lading copy received from the shipping company shows the description as acrylic fiber. 5.4 In the Bill of Entry No. 847647, dated 25-7-2007 relating to Bill of Lading No. APLU 027605203 - in the invoice and Bill of Lading received by the appellant-CHA shows the quantity as 41,619 kg. of acrylic fiber, whereas in the Bill of Lading received by Revenue through shipping company shows quantity 51,947 kgs. With respect of Bill of Entry No. 770224, dated 22-5-2007 relating to Bill of Lading No. 2253998, as per the copy of invoice and Bill of Ladin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustoms. I state that in Mumbai Customs there is no requirement of authorization by the importer or exporter to the CHA, consignment wise the authority is one time authority given by the importer or exporter in favour of CHA for all his consignments. As a proof of my this contention I can submit one such authority of M/s. Jaldhara Exports for appointing our company as CHA. This authority has been received by me through fax from my office at Mumbai today at the DRI Office fax on which I am submitting after signing by me in today s date. On being asked about the mode of our charges on A/c of CHA services provided to these 3 firms of Garg family of Ludhiana, I state that we never received such charges in cash from them and it was always through banking channel which I have explained above. 5.6 The learned Counsel further urges that it is evident from the statement recorded that there is no complicity of the appellant-CHA with the importers in the alleged misdeclaration, fraud and forgery. Further, from the allegation labelled in the charges, nowhere in fact it has been alleged any facts, leading to the charges of the aiding and abetting and gross negligence on part of the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 The learned Counsel further points out that no person of ordinary prudence at the time of recording of the statement on 5-2-2011, it was stated to the effect although we have signed on the back side of original Bill of Lading received through courier from importer for further submission to the shipping line for obtaining delivery order, at that time also we have failed to correct our mistake in respect of description of goods and in this way, we failed to perform duties of CHA as required under CHALR. Thus, it is evident that the statement of Mr. Deepak Aggarwal recorded on 5-2-2011 was not suo motu, but was rather a dictated one and hence, reliance placed on the same by the learned Commissioner is misplaced. 5.9 It is further urged that the impugned order is based on presumption and assumption as well as surmises and as such fit to be set aside. It is also urged that before completion of the adjudication under main show cause notice under Section 124, the Commissioner has erred in pre-judging allegations, and arrived at erroneous conclusion and as such the impugned order is fit to be set aside. It is further urged that it have nowhere come on record that the importers have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner have recorded that as per the investigation, the importers have submitted the fabricated documents shown value on lower side and mis-declared the import goods to evade customs duty as well as ADD. The importers were actually importing the acrylic fiber classifiable under CTH 5503 30 00, by mis-describing the same and manipulated as acrylic tow, they were classifying the same under CTH 5501 30 00. The importers were also declaring the less quantity than the actual quantity imported under the import documents and simultaneously undervalued the same with sole intention to evade customs duty. The importers fabricated and forged various documents such as invoice, packing list, High Seas Sale Agreement and presented such forged and fabricated documents to the customs in violation of Section 45 of the Customs Act, resulting in evasion of Customs duty. The importers even fabricated and forged some of the Bills of Entry showing actual quantity, description and actual valuation and presented the same (forging signature of customs officers) to their Bank for the purpose of remittance of actual value of export under L.C. to the foreign supplier. The importers even forged signature of Custo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the charge has been framed in the first place because of the fact that forgery of official document and signatures were committed by the importers and the CHA is sought to be charged under CHALR, 2004 for violation of Regulation 13(i). However, nothing has come on record to even remotely suggest the violation of this regulation by the CHA. The act of forgery of documents or signature by the importer cannot ipso facto form the ground for violation of this charge. The learned Commissioner has held by relying on the statement dated 5-2-2011 of Mr. Deepak Aggarwal, Director of CHA holding that the charges under Regulation 13(n) are proved, where the CHA is required to work with utmost speed and efficiency, is proved merely on account on the fact that Mr. Deepak Aggarwal has submitted that they have failed to compare the invoice/Bill of Lading received by fax and the original received through courier later on and that they have failed to correct their mistake in respect of description of the goods and in this way they have failed to perform the duty of CHA. 7.1 Further, the learned Commissioner has erred in holding that there is connivance of the CHA with the importer without ..... 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