Customs broker liability under Section 114(1) sustained for employee's omission causing export clearance failure.

A customs broker was held liable under Section 114(1) of the Customs Act, 1962 because its act or omission, including an employee's admitted mistake in handing over shipping bills without ensuring proper customs clearance, rendered the goods liable to confiscation under Section 113. The argument that liability was excluded because the Customs Brokers Licensing Regulations, 2004 contain their own penalty regime was rejected, as those regulations do not bar action under the Customs Act. Prior authorities were found distinguishable on their facts, and the broker was treated as ible for the acts and omissions of its employees under paragraph 13(12) of the regulations. The reduced penalty was affirmed.

---

---

Issues: Whether penalty under Section 114(1) of the Customs Act, 1962 was sustainable against a customs broker for export of goods without Let Export Order, and whether the broker could avoid liability by relying on the alleged fault of the ground handling agency or employee.

Analysis: The penalty was upheld on the footing that Section 114 applies to any person whose act or omission renders goods liable to confiscation under Section 113. The argument that penal liability was excluded because the Customs Brokers Licensing Regulations provide their own consequences was rejected, since the regulation regime does not bar action under the Customs Act. The prior authorities relied upon by the appellant were held distinguishable because they concerned different factual settings and denial of involvement, whereas here the employee admitted the mistake and sought leniency. The responsibility of the customs broker for the acts and omissions of its employees was emphasized under paragraph 13(12) of the Customs Brokers Licensing Regulations, 2004, and the admission was treated as sufficient for the purpose of liability.

Conclusion: Penalty under Section 114(1) of the Customs Act, 1962 was rightly imposed and the customs broker was liable for the employee's act in handing over the shipping bills without ensuring proper customs clearance.

Final Conclusion: The challenge to the reduced penalty failed, and the departmental order sustaining the penalty was affirmed.

Ratio Decidendi: A customs broker may be penalised under Section 114(1) of the Customs Act, 1962 where its act or omission, including the admitted mistake of its employee, renders goods liable to confiscation under Section 113, and the existence of regulatory penalties under the Customs Brokers Licensing Regulations, 2004 does not exclude such liability.

---