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TMI Blog2020 (2) TMI 1083X X X X Extracts X X X X X X X X Extracts X X X X ..... freight forwarding and cargo movement for his client. Nothing has been brought on record by which it can be shown that they had the knowledge of fraud being committed by the exporters by mis-declaring the value - Without bringing on record any evidence to show that these persons have acted beyond their normal business requirements or had the knowledge of the fraud being committed, they cannot be held liable for aiding or abetting the fraud. Thus the penalty imposed under Section 114(i) and 114(iii) is not maintainable. Similar issue decided in the case of FREIGHTWINGS AND TRAVELS LTD, DASHRATHLAL BHAGWANDAS GUPTA VERSUS COMMISSIONER OF CUSTOMS (EXPORT) ACC, MUMBAI [ 2017 (4) TMI 259 - CESTAT MUMBAI ] where it was held that Mere filing of bills or presentation of goods that were found to be liable to confiscation does not constitute act or omission referred to in section 114 because these are procedural requirements. None of the statements establish that the appellants were aware or participated in the procurement, packing or transportation of the goods. Appeal allowed - decided in favor of appellant. - HON BLE DR. D.M. MISRA, MEMBER (JUDICIAL) AND HON BLE MR. SANJIV SRIVASTAVA, M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty of ₹ 4,20,000/- (Rupees Four Lakhs Twenty Thousand only) on Shri Gyan B Sharma, partner of Vinayak Shipping Agency, CHA under Section 114(i) and 114(iii) of the Customs Act, 1962; i. I hereby impose a penalty of ₹ 4,20,000/- (Rupees Four Lakhs Twenty Thousand only) on Shri Rashid Y Shaikh proprietor of Panorama Express Agency, under Section 114(i) and 114(iii) of the Customs Act, 1962. 2.1 Acting on intelligence, M/s Frost International Ltd is attempting to export low quality readymade garments viz. 100% Cotton Knitted T Shirts from Bombay based ports through its power of Attorney holder Shri Nirmal Agarwal, by mis-declaring its PMV (Present Market Value) and FOB value, so as to avail higher and ineligible amount of duty drawback. During the course of investigation in the said matter of exports by Frost, it was found that the export documents were signed by Shri Ajay Verma who is proprietor of a firm M/s Aum International having IEC 0303038161. On behalf of M/s Aum International, M/s Vinayak Shipping Services (CHA No 11/898) had filed shipping bill No 5327189 dated 15.03.2004 for export goods declared 12000 Pcs of Mens 100% Cotton Knitted T-Shirts under Duty Drawb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as ₹ 4,20,000/- ii. The declared PMV of ₹ 120 per piece of Mens 100% Cotton Knitted T Shirts sought to be exported under above Shipping Bill filed with Mumbai Custom House should not be determined at ₹ 28.53- per piece. iii. The drawback claimed amounting to ₹ 4,30,254/- in respect of said Mens 100% Cotton Knitted T Shirts sought to be exported under said Shipping Bill filed with Mumbai Custom House should not be denied to them under Section 76(1)(b) of the Customs Act, 1962 as the PMV of goods sought to be exported is less than the drawback due on declared value. iv. The total quantity of 12,000 pieces of Mens 100% Cotton Knitted T Shirts having declared FOB value of ₹ 40,59,000/- and determined FOB value of ₹ 4,20,000/- seized under Seizure Memorandum dated 27.05.004 should not be confiscated under Section 113(d) and 113(i) of the Customs Act, 1962. v. penalty should not be imposed under Section 114(i) and 114(iii) of the Customs Act, 1962. B. Shri Nirmal Agarwal, Shri Gyan B Sharma Partner M/s Vinayak Shipping (CHA 11/898) and Shri Rashid Y Shaikh, Proprietor, M/s Panorama Express Agencies and authorized Signatory M/s Vinayak Shipping Services ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmissions made in appeal and during the course of Argument. 4.4 The findings recorded by the Commissioner in the impugned order holding the appellants in appeal No C/454/2012 and C/459/ 2012 are reproduced below: 90. As far as Shri Gyan B Sharma, partner of Vinayak Shipping Agency is concerned, I find that even though they had promised to file written submissions within one week, they did not file any such submission. Further during the course of hearing they had produced a copy of CESTAT order No A/1/CSTB/2008/C dated 24.12.2007 and had submitted that the CESTAT had given decision in their favour. However, on going through the said order, I find that the CESTAT had remanded the case back to the adjudicating officer, in the proceedings pertaining to revocation of their license to work as CHA. Further, I find that Shri Gyan B Sharma has not contested that he had illegally lent his CHA Licence to Shri Rashid Shaikh and thus aided and abetted in the fraud committed by the exporter. Therefore I hold Shri Gyan B Sharma liable for penalty under Section 114(i) and 114(iii) provisions of Customs Act, 1962. 91. Shri Rashid Y Shaikh, of Panorama Express Agencies has also not made any submiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsible for undertaking the work of custom assessment and physical examination in docks. These are the functions that are to be attended by the CHA in normal course of his business. Similar M/s Panorama Express Agencies was in business of freight forwarding and cargo movement for his client. Nothing has been brought on record by which it can be shown that they had the knowledge of fraud being committed by the exporters by mis-declaring the value. Without bringing on record any evidence to show that these persons have acted beyond their normal business requirements or had the knowledge of the fraud being committed, they cannot be held liable for aiding or abetting the fraud. Thus the penalty imposed under Section 114(i) and 114(iii) is not maintainable. Similar view has been expressed by the tribunal in case of Freightwings Travels Ltd [2017 (358) ELT 669 (T-Mum)] in following words- 8.Doubtlessly, the goods can be subject to confiscation if value is found to have been misdeclared. Penalty is imposed only if it is established that, in relation to the offending goods, some act is committed or is omitted to be done that leads to confiscation. Such act or omission has not been brought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by them. If there is any difference in the value of the export consignment, the CHA cannot be held responsible for the same as it is not the duty of the CHA to adjudge the correct value of the goods. There is virtually no evidence on record to show that he was aware of the overvaluation of the export consignment and he simplicitor proceeded by the declaration made by the exporters. In such a scenario, the appellant cannot be held liable for any aiding and abetting and consequently to penalty. 7. In the case of Adani Wilmar Ltd. v. Commissioner of Customs (Prev), Jamnagar [2015 (330) E.L.T. 549 (Tri.- Ahmd.)] wherein it was held that non-following of the KYC norms of CHA Licence would result in breach of Regulation 13 of CHALR and not under Customs Act, 1962. In the absence of any evidence that CHA was aware of the alleged irregularities by the exporter, imposition of penalty on him is not justified. We find from the present impugned order that apart from the fact that the appellant did not physically verified the correctness of the address given to him by the exporter, whereas all other documents were verified from computer data and found to be correct. This fact by itself cannot l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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