2011 (4) TMI 903 - AT - Customs

Appeal modifies CHA Licence restoration timeline and upholds security deposit forfeiture.

Jai International Versus Commissioner of Customs (General), Mumbai

Jai International Versus Commissioner of Customs (General), Mumbai - 2014 (313) E.L.T. 699 (Tri. - Mumbai) Issues Involved:1. Revocation of CHA Licence under Regulation 22 (7) of CHALR, 2004.2. Violation of Regulation 12 of CHALR.3. Violation of Regulation 13 (a) of CHALR.4. Violation of Regulation 13 (d) and 13 (n) of CHALR.5. Violation of Regulation 19 (8) of CHALR.6. Mitigating circumstances and determination of punishment.Detailed Analysis:1. Revocation of CHA Licence under Regulation 22 (7) of CHALR, 2004:The appellant's CHA Licence was revoked, and the security deposit was forfeited by the Commissioner under Regulation 22 (7) of CHALR, 2004. The stay application for this revocation was dismissed as the appeal itself was taken up for final hearing and disposal.2. Violation of Regulation 12 of CHALR:The first charge against the appellant was subletting the CHA Licence to Mr. Rakesh Mehta of M/s D.J. International for monetary consideration. This charge was supported by statements from Mr. Ashok Kumar Ram Jaiswar and Mr. Rakesh Mehta under Section 108 of the Customs Act. Both statements corroborated that Mr. Mehta used the appellant's CHA Licence independently and paid commission to the appellant. The appellant's claim that the statements were coerced was rejected as there was no retraction of the statements. The Tribunal concluded that the appellant breached Regulation 12 of CHALR by allowing their licence to be used by another firm for consideration.3. Violation of Regulation 13 (a) of CHALR:The appellant was charged with not obtaining written authorization from M/s Satyam Overseas for clearing consignments, violating Regulation 13 (a) of CHALR. The appellant's argument of contributory default by the Customs officer was dismissed. The Tribunal upheld that the appellant violated Regulation 13 (a) as they failed to obtain and produce written authorization from the importer.4. Violation of Regulation 13 (d) and 13 (n) of CHALR:The appellant was found to have violated Regulation 13 (d) and 13 (n) by not advising their client to comply with the Customs Act and not ensuring efficient discharge of duties. The Tribunal noted that since Mr. Rakesh Mehta handled the consignments independently, the appellant could not fulfill these obligations, resulting from their own conduct of allowing the licence to be used by another entity.5. Violation of Regulation 19 (8) of CHALR:The appellant was charged under Regulation 19 (8) for failing to supervise their employee, Mr. Rakesh Mehta. The Tribunal rejected the appellant's argument that Mr. Mehta acted as their employee, noting that he handled the consignments as the proprietor of M/s D.J. International. The appellant's predicament arose from subletting the CHA Licence.6. Mitigating Circumstances and Determination of Punishment:The Tribunal sustained the Commissioner's decision in principle, establishing that the appellant breached multiple regulations. However, considering mitigating circumstances, such as the period of suspension already suffered and the impact on the appellant's employees, the Tribunal decided to modify the punishment. The appellant's licence would remain revoked for an additional year from the receipt of the order, after which it could be restored upon fresh security deposit. The forfeiture of the security deposit was upheld.Conclusion:The appeal was disposed of with the modification that the appellant's CHA Licence would be restored after one year from the receipt of the order, subject to a fresh security deposit, while the forfeiture of the existing security deposit was upheld.