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TMI Blog2017 (4) TMI 583X X X X Extracts X X X X X X X X Extracts X X X X ..... ring the same to be natural granite chips . A response was filed by the appellant on 20.2.2008 denying any involvement in the transaction. The defence taken was to the effect that the goods originally packed in the container, natural granite chips , were substituted clandestinely and without the knowledge of the appellant at the time of transportation to the port for export. Once the containers were packed and sealed, they were beyond the control or responsibility of the custodian and no liability could, according to the appellant, be fastened on it on this account. Thus, since the role of the CFS as custodian did not extend to the supervision of transportation from the CFS to the port, there was no liability in regard to any event that may transpire after the goods left the freight station. According to the appellant, transportation was the domain of custom house agent and not the custodian. 3. An order-in-original was passed on 23.12.2008 rejecting the objections raised and confirming the levy of penalty of an amount of Rs. 5 lakhs on the appellant in terms of section 114 of the Act. The levy was challenged before the CESTAT, which vide the impugned order dated 16.05.2015 confir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he SANCO TRANS LIMITED, situated at Tiruvottiyur, Madras - 600 019. Similarly the rules and regulations which are applicable for the movement of containers from the port area are also applicable for the movement of containers from and to the aforesaid viz. Sanco Trans container Freight Station, with modificator if necessary." A detailed set of guidelines was issued by the Central Board of Excise and Customs in Circular N0.128/1995 in F.No.434/12/92-CUS IV dealing with the appointment of custodians. The guidelines are exhaustive and address comprehensively all aspects of safeguarding of the goods such as the provision of safe and secure premises for storage of cargo, various stipulations with respect to the infrastructure to be provided, insurance, execution of a bond equal to the value of the goods stored and supported by a bank guarantee/Government bond/cash deposit equivalent to the 10% to the value of the goods, liability of duty on goods lost or pilfered in movement from the CFS, liability of duty for goods lost during transshipment, security of premises, cost of customs staff posted in the CFS, provision of furnished office space and residential accommodation as well as trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods are moving from ICD/CFS, it would be the responsibility of the custodian of the ICD/CFS. The custodian shall accept responsibility for shortages in the goods during transit and will be required to pay the amount equal to drawback/duty amount and other benefits availed by the exporters. They may be asked to execute separate bond for the transport of the goods from ICD to Ports/Airports and vice versa. 4. In case of movement of goods from ICD/CFS, the exporters are required to bring their goods meant for export to ICD/CFS and to file six copies of Shipping Bill along with all necessary documents like GR Form, AR Form, certificates issued by Export Promotion Counsils, documents regarding quotas wherever applicable, etc. The Shipping Bills will be assessed as usual, the goods examined, samples drawn, if required, inspection carried out by other agencies under any one of Allied Acts. After the assessment of Shipping Bills, original and duplicate Shipping Bills along with the two more copies (transference copies) and original GR form will be retained at the ICD. The original GR form will be forwarded to respective branch of Reserve Bank of India. 5. The examination order would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eventive Officer posted at Port/Port will endorse, let export on both the copies of Shipping Bill and AR4 at the time of actual shipment. One copy of Shipping Bill would be retained at the Port/airport of Shipment and another transference copy would be returned to ICD/CFS from which the container/trucks originated. 9. On receipt of transference copy of Shipping Bill the ICD/CFS would match it with duplicate copy of Shipping Bill and to ensure that the goods have been exported. If the copy is not received within 90 days, the Assistant Commissioner of customs shall raise a demand on the custodian equal to the duty & drawback contained in the export goods in addition to action against the exporter & intimate the DGFT & RBI. 10. The salient features would be:- i. The Shipping Bills would be passed at ICD/CFS and same are not required to be passed at Gateway Ports/Airports. There would be no further examination of the goods if the seals are found intact. ii. The drawback would continue to be sanctioned after the 'let export' order is given on the Shipping Bill. iii. Original GR form would be retained at ICD/CFS and would be forwarded to respective branch of RBI there o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner of Customs (Export), Chennai-I vs. Bansal Industries (207 ELT 346). 9. The case of the petitioner is that the sealed containers were tampered with in transit between the CFS and the gate way port and the contents replaced with red sanders logs, a prohibited item. They would deny all responsibility for the substitution of the goods, stating that the onus of providing transportation and consequently the responsibility connected therewith, lay with the customs house agent. The guidelines issued reveal otherwise. Increasing clarity has been brought in with regard to the role and responsibility fastened upon the custodian with the evolution of the guidelines from 1993 to 1998. It is made incumbent on the CFS/custodian to assume responsibility, not merely for duty liability on loss/pilferage of goods under transportation, but for the goods itself. Even if the appellant were to state that the 1993 guideline was unclear in this regard, the 1998 circular is crystal clear. The transaction in question occurred in 2004 when the aforesaid circular was in effect. The very fact that a custodian is to be held responsible for loss of the goods means that the ultimate responsibility in re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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