2015 (6) TMI 186 - AT - Customs

CHA license reinstated after 4 years, security deposit forfeited. Decision balances punishment and relief.

The Tribunal set aside the revocation of the CHA license but upheld the forfeiture of the security deposit due to the violation of Regulation 13(e) of ... Revocation of CHA License - forfeiture of the full amount of security deposit furnished by the CHA - Violation of Regulation 13(e) - Held that:- CHA was not aware of the fraudulent attitude of the importers and the operators who engaged themselves in fraudulent import of high end cars/SUVs by mis -declaring the same as new vehicle. He has further recorded that the appellant CHA filed bills of entry as per import documents and during examination no adverse report received. - Commissioner has dropped the charges framed against the appellant CHA for violation of Regulation 13(a), 13(b), 13(d) and 19(8) of the CHALR , 2004. These Regulations inter alia provide that the CHA shall obtain an authorization from his client; transact business in the customs stations personally or through their employee; advise his client to comply with the provisions of the act and Regulation and exercise necessary supervision on conduct of his employee. The Commissioner did not find any violation on the part of the CHA in the above matters. We also notice that under para 30 of the impugned order that the CHA was not aware of the fraudulent attitude of the importers and the operators who engaged themselves in fraudulent import of high end cars/SUVs by mis -declaring the same as new vehicle. He has further recorded that the appellant CHA filed bills of entry as per import documents and during examination no adverse report received. - Out of four charges, one has been proved by the respondent but this alone is not enough for continued operation of the Commissioner's order. The CHA has already suffered for over four years on account of revocation of license. In our view, at this length of time, the CHA license needs to be restored. However, for not acting diligently, the Commissioner's order for forfeiture of security deposit has to be upheld. - revocation of licence is set aside, but the forfeiture of security deposit is sustained - Decided partly in favour of apeellant. Issues involved:Revocation of CHA license and forfeiture of security deposit under Regulation 20(1) of CHALR 2004 based on violation of regulations, specifically Regulation 13(e).Analysis:Revocation of CHA License:The appeal was filed against the Order-in-Original revoking the CHA license and forfeiting the security deposit. The case involved misdeclaration of imported vehicles leading to duty evasion. The CHA, M/s. Baid Organisation (P) Ltd., was found to have violated several provisions of CHALR 2004, resulting in the suspension of their license. The Commissioner upheld charges under Regulation 13(a), 13(d), 13(e), and 19(8) of CHALR, leading to the revocation of the license and forfeiture of the security deposit. Upon appeal to the Tribunal, the matter was remanded for fresh adjudication. The Commissioner dropped some charges but upheld the violation of Regulation 13(e), leading to the subsequent revocation of the license and forfeiture of the security deposit.Violation of Regulation 13(e):The primary ground for revocation of the CHA license was the violation of Regulation 13(e) of CHALR 2004, which requires the CHA to exercise due diligence in ascertaining the correctness of information imparted to the client regarding cargo clearance. The Commissioner found that the CHA failed to verify the genuineness of importers in multiple cases, leading to negligence and violation of the regulation. The Tribunal noted that the Commissioner had dropped charges related to other regulations but upheld the violation of Regulation 13(e). However, the Tribunal found that prior to detection by DRI, no irregularity was found in the import process, and the CHA was unaware of the fraudulent activities of importers. The Tribunal concluded that the revocation of the license solely on the grounds of Regulation 13(e) was not justified.Decision and Conclusion:After considering arguments from both sides, the Tribunal set aside the revocation of the CHA license but upheld the forfeiture of the security deposit. The Tribunal noted that the CHA had already suffered due to the license revocation for over four years and decided to allow the CHA to resume business upon furnishing a fresh security deposit. The Tribunal emphasized that while one charge was proved, it was not sufficient for the continued operation of the Commissioner's order. The decision aimed to balance the punishment with the duration of suffering faced by the CHA, ultimately providing relief by restoring the CHA license but upholding the forfeiture of the security deposit.