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TMI Blog2021 (9) TMI 193X X X X Extracts X X X X X X X X Extracts X X X X ..... derive at proper conclusion based on all materials and facts that have been collected during the inquiry. The first stage of such inquiry as laid down in the Regulation is to collect material / statements so as to give opportunity to those persons who are required or relevant to be heard. In the second stage, the Regulation provides for giving opportunity to the Customs Broker to cross-examine those persons whose statements have been recorded. The Inquiry Officer should support his conclusion with reason. The principles of natural justice requires that a copy thereof recording the reasons of disagreement has to be supplied to the Customs Broker so that he is able to reply to the charges levelled against him as against the conclusions arrived by the Inquiry Officer. Thus, the adjudicating authority is bound to put to notice the Customs Broker, setting out tentative conclusions or the points on which he differs from the Inquiry Officer. This would facilitate and ensure the right of Customs Broker to defend his case - In the instant case, though the Inquiry Officer has reported that there is no violation under Regulation 11(a), (d) and (n) of the CBLR, 2013 the adjudicating author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duce such authorisation whenever required by the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be; As per Regulation 11(d) Advise his client to comply with the provisions of the Act and in case of noncompliance, shall bring the matter to the notice of the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be; As per Regulation 11(n) Verify antecedent, correctness of Importer Exporter Code (IEC) number, identity of his client and functioning of his client at the declared address by using reliable, independent, authentic documents, data or information. As per Regulation 18 of CBLR, 2013, the Commissioner of Customs may subject to the provisions of Regulation 20 of CBLR, 2013, revoke the license of Customs Broker and order forfeiture of part of whole of the security or impose penalty not exceeding fifty thousand rupees on a Custos Broker on any of the following grounds, namely: (a) failure of to comply with any of the conditions of the bond executed by him under regulation 8; (b) failure to comply with any of the provisions of these regulations, within his jurisdiction or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11(n), he adverted to para 14 of the impugned order and submitted that the adjudicating authority has held that the appellant has violated Regulation 11(n) only on the ground that the person representing the importer-firm did not appear before the customs authorities. There is no case for the department that the importer-firm is a fake firm. When the importer was very much available in the address, which is mentioned in the KYC documents, the department could have taken coercive steps if it is necessary for him to participate in the investigation. The appellant is not equipped to force the attendance of such a importer or his representative before the customs authorities. The said finding of the adjudicating authority is beyond the scope of Regulation 11(n) of the CBLR, 2013. He added that the adjudicating authority has dropped the charges under Regulation 11(d) holding that the appellant was not aware of the fact that the consignment contained undeclared cargo. When there is such a finding by the adjudicating authority, the penalty imposed merely for the reason that the KYC document was obtained from a middleman and not from the importer directly and also for the reason that the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Shri Karthi. Since the consignment contained undeclared cargo, it is very much clear that the appellant has not been sufficiently diligent in obtaining authorization / KYC documents. The penalty imposed is therefore legal and proper. 7. Heard both sides. 8. The relevant provisions have already been reproduced above. Under Regulation 11(a), the Customs Broker has to obtain authorization from the firm / individual by whom he is being employed as a Customs Broker. In the present case, there is no dispute with the address of the importer or his IE Code. The only allegation put forward under Regulation 11(a) is that the appellant had not obtained the KYC documents from the importer directly but through a middleman, be it Shri Ramadhurai or Shri Karthi. When the necessary authorization and KYC documents have been obtained and when these documents are proper, merely because the said documents were not obtained directly from the importer, the appellant cannot be said to have violated provisions of Regulation 11(a). It may not always be practical for a Customs Broker to obtain the documents directly from the importer. In the case of K.S. Sawant Co. (supra) in para 5.1, the Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort, stating the grounds on which it is proposed to revoke the licence or impose penalty requiring the said Customs Broker to submit within thirty days to the Deputy Commissioner of Customs or Assistant Commissioner of Customs nominated by him, a written statement of defense and also to specify in the said statement whether the Customs Broker desires to be heard in person by the said Deputy Commissioner of Customs or Assistant Commissioner of Customs. (2) The Commissioner of Customs may, on receipt of the written statement from the Customs Broker, or where no such statement has been received within the timelimit specified in the notice referred to in sub-regulation (1), direct the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be, to inquire into the grounds which are not admitted by the Customs Broker. (3) The Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be, shall, in the course of inquiry, consider such documentary evidence and take such oral evidence as may be relevant or material to the inquiry in regard to the grounds forming the basis of the proceedings, and he may also put any quest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the person whose conduct is the subject matter of the Show Cause Notice. The purpose of such inquiry is to help the adjudicating authority to derive at proper conclusion based on all materials and facts that have been collected during the inquiry. The first stage of such inquiry as laid down in the Regulation is to collect material / statements so as to give opportunity to those persons who are required or relevant to be heard. In the second stage, the Regulation provides for giving opportunity to the Customs Broker to cross-examine those persons whose statements have been recorded. The Inquiry Officer should support his conclusion with reason. As per sub-clause (6) of Regulation 20, a copy of the inquiry report is to be served to the Customs Broker. This is to ensure that the Customs Broker is to be equipped to defend his case at the time of adjudication as the inquiry report would play a vital role in the adjudication proceedings. If the adjudicating authority proposes not to accept the conclusion arrived in the inquiry report, he has to record reasons for disagreeing with the findings of the Inquiry Officer. The principles of natural justice requires that a copy thereof recordi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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