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TMI Blog2017 (3) TMI 214X X X X Extracts X X X X X X X X Extracts X X X X ..... stantial evidence either against the exporter or the CHA brought on record attributing their involvement for loading of the container and thereafter sailing of the vessel,l without LEO, resulting into contravention of relevant provisions of the Customs Act namely 34, 40 and 51 of the said Act - penalty on the appellant exporter M/s Arvind Mills Limited and the CHA M/s Chinubhai Kalidass & Bros cannot be sustained, accordingly, set aside. Penalty on surveyor - On behalf of surveyor, M/s Master Marine Services Pvt. Ltd it is vehemently argued that only because they prepared the Form No.6, therefore, they cannot be penalized - Held that: - the CHA addressed a letter to CFS, Mundra providing the details of the container seal number etc. for issuance of Form No.6 to offload of the container. Also in the daily activity report dated 25.6.2006 prepared by the surveyor, it records the container number, destination etc. but no way these documents could be considered as indicating or allowing loading of the container on the vessel and thereafter for its export - the container was loaded and later sailed without the LEO and in violation of the relevant provisions of Customs Act,1962, withou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll, invoice, packing list, computerized sheets of MICT etc. resumed under Panchnama dated 28.6.2006 and thereafter statements of various persons were recorded and on completion of investigation, a show cause notice was issued alleging violation of various provisions of Customs Act, 1962 and proposed for confiscation of the goods along with container, denial of DEPB benefit to the appellant M/s Arvind Mills Ltd. and also proposal for imposition of penalty under Section 114 (iii) of the Customs Act, 1962 on the exporter M/s Arvind Mills Limited and other appellants. On adjudication, ld. Commissioner of Customs imposed penalty of ₹ 8 lakhs on each of the appellants, M/s Arvind Mills Ltd., M/s Chinubhai Kalidas Bros., M/s Volkart Fleming Shipping Services Pvt. Ltd; ₹ 5 lakhs each on Mundra International Container Terminal (P) Ltd. and M/s Master Marine Services Pvt. Ltd u/s 114(iii) of the Customs Act,1962. Aggrieved by the said order, the appellants are before this forum. 3. Ld. Advocate Shri S.J. Vyas, Advocate for the appellant exporter M/s Arvind Mills Limited submitted that the penalty was imposed on the ground that the exported goods loaded on the vessel and it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant - CHA was in process of completing the Customs formalities, however, on Tuesday, 27th June, 2006, the steamer agent loaded the container on the vessel without their knowledge and permission and also the vessel sailed on Wednesday, 28th June, 2006. The appellant - CHA came to know of this fact while making an attempt to locate the containers along with Customs officer for scrutiny of the description of goods and learnt that the container loaded on vessel had already sailed. 5. Ld. Advocate further submitted that penalty under Section 114 (iii) of the Customs Act, 1962 was imposed on the ground that Sections 34 and 40 of Customs Act, 1962 were violated. It is his contention that these two provisions are do not applicable to either the exporter or the CHA. Ld. Advocate submitted that the appellant - CHA never prompted the shipping line to export the goods in contravention of the Law. It is his contention that the shipment happened without prior notice or intimation to the exporter or the appellant-CHA. Thus, the appellant CHA has not committed any act or omission rendering the goods liable for confiscation. Consequently, penalty under Section 114(iii) is unwarranted and un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ever appointed by shipping line to prepare Export Advance List based on which the container was loaded into the vessel. It is his contention that Section 40 of the Customs Act imposed responsibility on a person in-charge of conveyance to permit loading of container at Customs Station upon receipt of shipping bill duly endorsed by the proper officer. Such responsibility cannot be extended to the appellant who is merely acted as a surveyor of the shipping line to facilitate to bring container from yard to port area. He submitted that on identical circumstance in the appellant s own case, the ld. Commissioner vide Order-in-Appeal No.417/2009-Cus/Commr(A)/KDL dt.31.8.2009 allowed their appeal and quashed the penalty imposed on them observing that the appellant statutorily not responsible for any act for which goods were liable for confiscation. 7. Ld. Advocate, Shri Dhaval K. Shah for the appellant M/s Volkart Fleming Shipping Services Pvt. Ltd. , the Shipping Line, submitted that the appellant had appointed M/s Master Marine Services Pvt. Ltd. as surveyor for compliance of the Customs documentation and on the basis of various documents, the surveyor issued form No.6 and daily act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts are that around 110 cartons of 100% Cotton Man s and woman s shirt in container No.CL HU-815922 stuffed in the factory of the appellant-Arvind Mills under the supervision of the Excise officer, after being loaded on the vessel MV Mac Andrews America on 27.6.2006 at 23.35 hrs., exported on 28.6.2006 at 13.30 hours, without Let Export Order (LEO) and pending assessment of Shipping Bill No.6070048 dated 26.6.2006. The ld. Commissioner in the impugned order even though held that the said exported goods are liable for confiscation under Section 113(f) and 113(g) of the Customs Act, 1962 but did not pass any order confiscating the goods since the said goods were not available for confiscation at he material time. He has imposed penalties on all the appellants under Section 114(iii) of the Customs Act, 1962. The limited question now that needs to be addressed is: whether penalty on each of the appellants is justified in the facts and circumstance of the case. The relevant provisions of the Customs Act,1962 which alleged to have been violated inviting imposition of penalty are as follows: SECTION 34. Goods not to be unloaded or loaded except under supervision of customs office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required to be followed in the export of the manufactured goods, which are factory stuffed, has been stated at Para 4 of the Show Cause Notice. It is stated that the container sealed under the Central Excise supervision at factory received by the shipping line agent or his nominated agent was subsequently placed at the MICT yard on the basis of Form No.6 issued by the shipping agent. Thereafter, the CHA files checklist, for the shipping bill with the Customs EDI System. After processing of the shipping bill necessary verification/examination of the container number and seal number are done which are fed into the EDI system. Thereafter, the LEO was given by the proper officer under Section 51 of the Customs Act and copies of shipping bill are generated. After granting the LEO the containers are allowed to be loaded on board under the supervision of the Customs on the basis of shipping bill. The form No.6 prepared is not a prescribed document under the Customs Act and Rules made thereunder. It is an admitted fact that after factory stuffed container gated in on 24.6.2006, and that day being Saturday and the next day Sunday, therefore, the CHA filed shipping bill on Monday i.e. on 27 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner into the CFS port area. In its letter dated 24.6.2006, the CHA addressed a letter to CFS, Mundra( which later they claimed an error as it is to be addressed to the Shipping line agent) providing the details of the container seal number etc. for issuance of Form No.6 to offload of the container. Also in the daily activity report dated 25.6.2006 prepared by the surveyor, it records the container number, destination etc. but no way these documents could be considered as indicating or allowing loading of the container on the vessel and thereafter for its export. I find force in the contention of the appellant-surveyor that the container was loaded and later sailed without the LEO and in violation of the relevant provisions of Customs Act,1962, without their involvement. Hence, the penalty imposed on them is also set aside. 13. Now, coming to the role of the shipping agent , I find that the shipping line agent, M/s Volkart Fleming Shipping Services Pvt. Ltd. was appointed by the overseas purchasers as stated in the statement of Shri C.R. Gharat, Executive Operation of the said company. Their role was to release the empty container through yard as per requirement and the contain ..... X X X X Extracts X X X X X X X X Extracts X X X X
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