2023 (8) TMI 264 - AT - Customs

Partial Appeal Success for Sameer Logistics in Customs Broker License Revocation Case

The tribunal partly allowed the appeal by M/s. Sameer Logistics Pvt. Ltd. challenging the revocation of their Customs Broker Licence. While the revocation ... Revocation of their Customs Broker Licence - forfeiture of security deposit - imposition of penalty - alleged that the appellant had colluded with unscrupulous persons and had failed to discharge their obligations as a customs Broker as envisaged under the CBLR, 2013 - HELD THAT:- There is no doubt that Mrs. R. Premavathy, who was the authorized signatory of the appellant, has admitted that her job was only to disclose the password for filing the Bill-of-Entry online for a monthly remuneration of twenty thousand rupees. The entire business was being transacted by Mr. I. Durai Murugan of M/s. India Exim Services, representing the appellant M/s. Sameer Logistics Pvt. Ltd. The impugned goods were found to be imported on behalf of M/s. Jeppiar Furnace and Steels Pvt. Ltd., Chennai by Mr. S. Murugan of M/s. Sri Lakshmi Impex, Madurai on fabricated documents. The appellant, by allowing Mr. I. Durai Murugan of M/s. India Exim Services, has thus clearly contravened the provisions of various Regulations of the CBLR, 2013. The appellant, through Mr. I. Durai Murugan, have facilitated imports by persons other than the IEC holder, by misusing the IEC of M/s. Jeppiar Furnace and Steels Pvt. Ltd. and knowingly issued KK Form thereby enabling to hand over the imported goods to the transporter arranged by Mr. S. Murugan, when the Bill-of-Entry was filed in the name of M/s. Jeppiar Furnace and Steels Pvt. Ltd. Investigations have proved the culpability of Mr. S. Murugan of M/s. Sri Lakshmi Impex and how the conspiracy to smuggle huge value of cigarettes was carried out with the connivance of Mr. I. Durai Murugan representing the appellant. Though the imported goods were examined and seized in March 2016, the CHA Licence was suspended by the Commissioner of Customs on 31.01.2017 i.e., more than nine months after the initial detection of smuggling, vide Order of Suspension dated 31.01.2017. The suspension was continued vide another Order dated 23.03.2017. The Show Cause Notice, proposing revocation of licence, was issued on 07.04.2017 and the Inquiry Report was submitted on 07.07.2017 and thereafter, the order of revocation of licence was passed by the Commissioner of Customs vide his Order dated 05.10.2017 - all the time-limits prescribed under the CBLR, 2013 have been complied with by the Department. It is not the case of the appellant that his licence was suspended soon after the seizure of the contraband. Completing investigations and sending a report has taken around nine months and the appellant was allowed to continue to carry on with his business till his licence was suspended only on 31.01.2017. Contravention of some of the provisions of the Customs Brokers Licensing Regulations - HELD THAT:- The appellant had undertaken the clearance work in good faith and the imported item declared as LMS Bundle Scrap was on the basis of various documents namely, invoice, packing list, Bill-of-Lading, Pre Shipment Inspection Certificate, High Sea Sales Agreement, etc.; that there was no delay in discharge of their duties as a Customs Broker and in maintaining up-to-date records of clearance documents. Thus, the appellant has not contravened the provisions of Regulations 11(m) and 11(k) of the CBLR, 2013. The violation of the CBLR, 2013 though stands established, the revocation of Customs Broker Licence is too harsh a punishment and hence, the revocation is set aside considering the fact that the appellant’s Customs Broker Licence was suspended and so, was out of business for more than six and a half years. The forfeiture of security deposit as well as the penalty of Rs.50,000/- imposed by the adjudicating authority on the appellant upheld - the order of revocation and direct the Commissioner of Customs to restore the Customs Broker Licence set aside - The appeal is partly allowed. Issues Involved:1. Justification of revocation of Customs Broker Licence.2. Validity of forfeiture of security deposit.3. Justification of imposition of penalty.Summary:Issue 1: Justification of Revocation of Customs Broker LicenceThe appellant, M/s. Sameer Logistics Pvt. Ltd., challenged the revocation of their Customs Broker Licence by the Commissioner of Customs, Chennai, citing violations of various regulations under the Customs Brokers Licensing Regulations (CBLR), 2013. The appellant was accused of colluding with unscrupulous individuals and failing to discharge their obligations, leading to the suspension and subsequent revocation of their licence. The inquiry officer confirmed the violations, and the Commissioner observed that the appellant was involved in wrong practices, leading to the revocation of the licence. However, the tribunal found that while the appellant had allowed unauthorized persons to file documents and issue KK Forms, the revocation of the licence was too harsh a punishment. Considering the appellant had been out of business for over six years, the tribunal set aside the revocation of the licence.Issue 2: Validity of Forfeiture of Security DepositThe Commissioner of Customs ordered the forfeiture of the appellant's security deposit of Rs.1,00,000/- under Regulation 18 of the CBLR, 2013. The tribunal upheld the forfeiture of the security deposit, agreeing with the adjudicating authority's decision.Issue 3: Justification of Imposition of PenaltyThe Commissioner also imposed a penalty of Rs.50,000/- on the appellant under Regulation 18 of the CBLR, 2013. The tribunal upheld the imposition of the penalty, finding it justified in light of the appellant's violations. Conclusion:The appeal was partly allowed. The tribunal set aside the order of revocation of the Customs Broker Licence but upheld the forfeiture of the security deposit and the imposition of the penalty. The Commissioner of Customs was directed to restore the Customs Broker Licence.