TaxTMI 
TaxTMI 
2020 (1) TMI 596
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.... entire security deposit. 2. It was pointed out Learned Counsel appearing for the appellant that out of the seven bills of entry filed by the importer, the one handled by them, no. 900280/05.09.2007, involved differential duty of a mere Rs. 1,70,485/-. It is also contended by him that, though the statement of their Director, Shri Chandrakant Waykar, was recorded on 22nd February 2010 before issue of show cause notice, neither the appellant nor the Director were made noticees in the proceedings under Customs Act, 1962. It is also pointed out that the incident, allegedly of 2007, was finally taken up for proceedings under the Regulations only in February 2018 indicating lack of any evidence against them. 3. On the proceedings, it is the contention of the Learned Counsel that the charges brought against them were limited to regulation 11(d) of Customs Brokers Licensing Regulations, 2013 and 11(n) of the said Regulations. The first of these requires advice to comply with the provisions of the Act and, in the event of non-compliance, to bring such incidents to the notice of the Deputy/Assistant Commissioner of Customs. The second of the regulation mandates the broker to verify the....
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....he Hon'ble High Court of Delhi in Kunal Travels (Cargo) v. Commissioner of Customs (I&G), IGI Airport, New Delhi [2017 (354) ELT 447 (Del.)] that 12. Clause (e) of the aforesaid Regulation requires exercise of due diligence by the CHA regarding such information which he may give to his client with reference to any work related to clearance of cargo. Clause (l) requires that all documents submitted, such as bills of entry and shipping bills delivered etc. reflect the name of the importer/exporter and the name of the CHA prominently at the top of such documents. The aforesaid clauses do not obligate the CHA to look into such information which may be made available to it from the exporter/importer. The CHA is not an inspector to weigh the genuineness of the transaction. It is a processing agent of documents with respect to clearance of goods through customs house and in that process only such authorized personnel of the CHA can enter the customs house area. What is noteworthy is that the IE Code of the exporter M/s. H.M. Impex was mentioned in the shipping bills, this itself reflects that before the grant of said IE Code, the background check of the said importer/exporter had....
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....e attributable to the client if wrong information were deliberately supplied to the CHA. Hence there could be no guilt, wrong, fault or penalty on the appellant apropos the contents of the shipping bills. Apropos any doubt about the issuance of the IE Code to M/s. H.S. Impex, it was for the respondents to take appropriate action. Furthermore, the inquiry report revealed that there was no delay in processing the documents by the appellant under Regulation 13(n). 13. This Court in Ashiana Cargo Services v. Commissioner of Customs (I&G) - 2014 (302) ELT 161 (Del.) has inter alia held : "...... 10. Beginning with the facts, there is virtually no dispute. There is a concurrent finding of fact by the Commissioner and the CESTAT that the appellant did not have knowledge that the illegal exports were effected using the G cards given to VK's employees. There was no active or passive facilitation by the appellant in that sense. Undoubtedly, the provision of the G cards to non-employees itself violated the CHA Regulations. This is an admitted fact, but it is not the Revenue's argument (nor is it the reasoning adopted by the Commissioner or the CESTAT) that this violation in ....
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.... licensee was aware that the consignment contained gypseous alabaster, a prohibited substance, but nonetheless, participated in its release from the Kandla Port. In CUS.A.A. 24/2012 Page 10 Santon Shipping (supra), the adjudicating authority came 'to the conclusion that the fraud in this case has been committed in so many consignments over a long period of time and the same could not have happened without the connivance of the CHA". The revocation of the license was again informed by the fact of connivance (i.e. mens rea as to the infraction) of the CHA. In Eagle Transport (supra), the CHA transferred the license altogether. As the CESTAT noted, '... the activities of the appellant firm were controlled day to day, not by Shrimankar but by employees of Amol Shipping Agency. We do not see how this does not amount to transfer of the licence in all but name. Hence, we must hold that the first and second articles of charge have been rightly held as proved." Moreover, more than 100 blank shipping bill forms were sent to a third-party. Following these aggravating factors, the penalty of revocation was justified by the CESTAT. Similarly, in HB Cargo (supra), relied upon by the majority of ....
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....lations of the CHA Regulations should not be dealt with sternly. A penalty must be imposed. At the same time, the penalty must - as in any ordered system - be proportional to the violation. Just as the law abhors impunity for infractions, it cautions against a disproportionate penalty. Neither extreme is to be encouraged. In this case, in view of the absence of any mens rea, the violation concerns the provision of G cards to two individuals and that alone. A penalty of revocation of license for this contravention of the CHA Regulations unjustly restricts the appellant's ability to engage in the business of the CHA for his entire lifetime. As importantly, it skews the proportionality doctrine, substantially lowering the bar for revocation as a permissible penalty, especially given the dire civil consequences that follow. On the other hand, the minority Opinion of the CESTAT, delivered by the Judicial Member, correctly appreciates the balance of relevant factors, i.e. knowledge/mens rea, gravity of the infraction, the stringency of the penalty of revocation, the fact that the appellant has already been unable to work his license for a period of 6 years (now 8 years), and accordingly ....