2023 (9) TMI 144 - AT - Customs

Tribunal upholds admissibility of Customs Act statement, finds breach of licensing regulations

Shyam Singh Versus Commissioner, Customs (AIRPORT & GENERAL), New Delhi

Shyam Singh Versus Commissioner, Customs (AIRPORT & GENERAL), New Delhi - TMI Issues Involved:1. Admissibility of the statement recorded under Section 108 of the Customs Act.2. Violation of principles of natural justice due to absence of cross-examination.3. Failure of the appellant to discharge obligations under the Customs Broker Licensing Regulations (CBLR), 2018.4. Maintainability of charges of mis-declaration and undervaluation.5. Proportionality of the punishment imposed under CBLR.Summary:1. Admissibility of the Statement under Section 108:The Tribunal held that the statement recorded under Section 108 of the Customs Act, though retracted, is binding on the appellant. The appellant's contention that the statement was not voluntary and was made under medication was rejected. The Tribunal referred to the Supreme Court's decision in *Surjeet Singh Chhabra vs. Union of India*, reiterating that Customs Officers are not Police Officers, and thus, statements under Section 108 are admissible as evidence.2. Violation of Principles of Natural Justice:The Tribunal found no violation of principles of natural justice due to the absence of cross-examination of witnesses. It was held that the appellant's own statement was sufficient to establish the substantive allegation of subletting the license. The Tribunal referred to multiple decisions, including *Surjeet Singh Chabbra* and *D.S. Cargo Agency vs. Commissioner of Customs*, supporting that failure to provide an opportunity for cross-examination is not a violation when there is a confessional statement by the party.3. Failure to Discharge Obligations under CBLR:The Tribunal upheld the findings that the appellant violated various provisions of CBLR, 2018, including Regulation 1(4) (prohibition on selling or transferring the license), and Regulations 10(a), 10(d), 10(e), and 10(n) (obligations of Customs Brokers). The appellant admitted to subletting his license for monetary gain, and thus, failed to verify the importers' details and ensure compliance with the Customs Act.4. Maintainability of Charges of Mis-declaration and Undervaluation:The Tribunal found that the adjudicating authority's observations regarding the appellant's role in mis-declaration and undervaluation were without material evidence and thus unsustainable. The Tribunal noted that the investigation by DRI was still ongoing, and no show cause notice had been issued to the importers or Zakir Khan.5. Proportionality of the Punishment:The Tribunal applied the doctrine of proportionality, considering the gravity of the situation and the nature of the violation. It was concluded that the revocation of the license was too harsh a penalty given the circumstances. The Tribunal modified the impugned order, setting aside the revocation of the Customs Broker License but affirming the forfeiture of the security deposit and the penalty of Rs. 50,000/-.Conclusion:The appeal was partly allowed, with the revocation of the Customs Broker License set aside, while the forfeiture of the security deposit and the penalty of Rs. 50,000/- were confirmed.