Customs tribunal affirms penalty for CHA violating export regulations, stresses duty of compliance and diligence

The tribunal upheld the penalty imposed on the Custom House Agent for violating Regulations 10(d), 10(e), and 10(n) of CBLR 2018 related to the absence of the mandatory Export Inspection Agency Certificate during the export of milk products. Despite the appellant's plea of ignorance, the tribunal emphasized the CHA's statutory duty to inform exporters about compliance requirements and exercise due diligence. The penalty was affirmed, with the tribunal stressing the significance of CHAs in customs procedures and the necessity of upholding trust and regulations in their operations.

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Issues:
Violation of Regulations 10(d), 10(e), and 10(n) of CBLR 2018 by the Custom House Agent (CHA).

Analysis:
The appeal was filed by a Custom House Agent (CHA) challenging the imposition of a penalty for violating Regulations 10(d), 10(e), and 10(n) of CBLR 2018. The case stemmed from the export of milk products without the mandatory Export Inspection Agency (EIA) Certificate. The CHA was alleged to have failed in exercising due diligence by not informing the exporter about the requirement of the EIA Certificate. The appellant argued that there was no malafide intent as both the exporter and the CHA were unaware of the necessity of the certificate, citing past instances where similar shipments were cleared without the demand for the EIA Certificate. The appellant also referenced a decision involving another custom house agent to support their case.

During the proceedings, the appellant emphasized that the obligation of the CHA under Regulation 10(e) was to exercise due diligence in providing accurate information to the client regarding cargo clearance requirements. The appellant's failure to ensure the presence of the EIA Certificate with the shipping bills was admitted, and it was established that the certificate was obtained after filing the bills. The tribunal noted that the CHA had a statutory duty to inform the exporter about compliance requirements and verify the client's antecedents for proper adherence to regulations.

The tribunal referred to a Supreme Court case emphasizing the significant role of CHAs in customs procedures and the importance of upholding trust and regulations in their operations. It was held that the appellant's plea of ignorance could not absolve them of their statutory duties. The tribunal found no fault in the penalty imposed, as the adjudicating authority had already shown leniency by not revoking the license or forfeiting the security deposit. Consequently, the tribunal upheld the penalty and dismissed the appeal.

In conclusion, the tribunal affirmed the penalty imposed on the CHA for violating Regulations 10(d), 10(e), and 10(n) of CBLR 2018 related to the failure to ensure the presence of the mandatory EIA Certificate during the export of milk products. The tribunal highlighted the importance of CHAs in customs procedures and upheld the penalty, considering the statutory obligations and the need for due diligence in cargo clearance operations.

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