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TMI Blog2023 (2) TMI 490X X X X Extracts X X X X X X X X Extracts X X X X ..... ccurring Potassium Chloride, the CHA ought to have classified the goods under ITC HS 31042000; and they ought to have not assisted the exporter in misdeclaring the goods as ITC HS as 28273990. The classification is not mentioned in the test reports. The main reason for imposing penalty on the appellants is that they did not ensure correct classification of the goods so as to see whether the goods are restricted items. The original authority has held that the appellant has abetted in the attempt to export restricted goods as they did not exercise due diligence to ascertain the correctness of the information imparted by their client. There is no allegation or evidence to establish that the appellant had indulged in any overt act or played any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er 6 Shipping Bills and was destined to Vietnam and Malaysia. The goods were examined in the presence of two independent witnesses, CHA, representative of exporter and the representative of CFS. On a reasonable belief that the consignment is misdeclared, samples were drawn for the purpose of chemical examination. The samples were forwarded to M/s.Coromandal Fertilizers Ltd., Chennai on 29.07.2009 for the purpose of chemical analysis to confirm the composition. After chemical examination, it was found that the consignment was Muriate Potash (Potassium Chloride). Based on the investigation, show cause notices were issued to the exporter and various other persons including M/s.Chakiat Agencies, who is the CHA, and Shri Soji Kuriakose who is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n that they had no role in the attempt to export the restricted goods. 3. Ld. Counsel stressed that there is no direct evidence to establish that the appellant had in any manner assisted the exporter to procure the restricted items. As a CHA, the appellants have relied on the documents furnished to them by their client.The provisions under the Customs Act cannot be invoked to impose penalty alleging that the appellant has not taken due diligence before filing the shipping bills. The CHALR is a self-contained subordinate Regulation, which itself provides for penalties for the non-compliance of the conditions prescribed therein. In the present case, the issue is with respect to classification. The goods had to be sent for chemical examinat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lants have abetted in the attempt to export the restricted goods. He prayed that appeals may be dismissed. 5. Heard both sides. 6. The Commissioner (Appeals) has imposed penalty of Rs.1 lakh each on the appellants under Section 114 of the Customs Act, 1962. The main allegation is that as a CHA, the appellants have abetted in the attempt to export the restricted goods by misclassifying the goods. On perusal of records, it is seen that along with consignment documents, the exporters have provided to the appellant a test report dated 03.04.2009 issued by Geological and Metallurgical Laboratories, Bangalore. In the said test report the composition of the sample is given in detail. The report reads as under : The sample is crystalline ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the details of the test report issued by Coromandal Fertilisers Ltd. on 03.08.2009. The test report says that the samples contain more than 60% of water soluble potash as K2O (%); having more than 65% of articles in the range of 1.7 mm to 0.25 mm in size; having a moisture content of less than 0.5% and sodium as NaCl percent by weight (on dry basis) less than 3.5%. On the basis of this test report, the department has concluded that the consignment declared as Industrial Salt (Potassium Chloride) is Muriate of Potash. 9. Be that as it may, the appellant as a CHA cannot be expected to examine and ensure the nature of the goods in the consignment. In para-65 of the impugned order, the adjudicating authority has observed that when the tes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not Medicaments . It is for the Customs Department to classify the goods. Under these circumstances, the levy of the penalty is not justified. By following the earlier decision of the Tribunal dated 28-4-2016, we find no reason to sustain the penalty and, therefore, set aside the impugned order. The appeal stands disposed of accordingly. 11. After appreciating the evidence and following the decision of the Tribunal in the above case, we are of the view that the penalty imposed on the appellants under Section 114 of the Customs Act is not warranted and are therefore required to be set aside which we hereby do. The impugned order is modified to the extent of setting aside the penalties imposed on these appellants. The appeals are allo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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