2003 (8) TMI 142 - AT - Customs

Customs Tribunal overturns penalty against Agent, citing lack of evidence and negligence.

The Tribunal set aside the Commissioner's order imposing a penalty of Rs. 25,000 on the Customs House Agent under Section 114(i) and 114(iii) of the ... Penalty - Custom House Agent Issues:Imposition of penalty on Customs House Agent (CHA) under Section 114(i) and 114(iii) of the Customs Act, 1962 for alleged involvement in fraudulent export activities.Detailed Analysis:1. Submission by Appellant:The appellant, through his advocate, argued that he was not aware of any illegal activities or fraudulent plans of the exporters. He claimed to have acted in good faith and followed all regulations laid down for CHAs. The appellant's representative at Tuticorin, Shri T. Ramasamy, was also not penalized by the Commissioner despite being unaware of the fraudulent activities. The appellant's practice of providing pre-signed shipping bills for administrative convenience was highlighted, emphasizing that this was not a basis for imposing a penalty. The advocate referred to previous judgments where penalties were not imposed when the clearing agent had no knowledge of illegal activities.2. Revenue's Submission:The Revenue argued that the act of the authorized signatory providing a blank shipping bill to his representative led to the commission of an offense, justifying the penalty. References were made to legal precedents where the actions of representatives were attributed to the principal, leading to penalties or revocation of licenses.3. Judgment and Analysis:The Tribunal examined the submissions and records. It noted that the employee of the CHA, Shri T. Ramasamy, was found to be unaware of the fraudulent export, and no penalty was imposed on him. The replacement of goods after customs clearance was also considered, absolving the CHA of responsibility. The Tribunal referred to previous judgments emphasizing that penalties can only be imposed in cases of culpable negligence, which was not established in this case. The Tribunal distinguished the cited cases by the Revenue, as they did not align with the facts of the present case.4. Decision:Based on the legal precedents and the lack of evidence showing the appellant's involvement in the fraudulent activities, the Tribunal set aside the Commissioner's order imposing a penalty of Rs. 25,000 on the CHA under Section 114(i) and 114(iii) of the Customs Act, 1962. The judgment was delivered on 25th August 2003, with the option for the appellant to approach for a copy of the order.This detailed analysis of the judgment highlights the arguments presented by both sides, the legal principles applied, and the ultimate decision reached by the Tribunal in setting aside the penalty imposed on the Customs House Agent.