AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2024 (6) TMI 636
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....During the course of investigation, incriminating documents and articles were recovered by Customs from the premises of the Appellant. Investigation revealed that the Appellant had allowed M/s. A.P. Cargo Enterprises to use the Customs Broker Licence for a monetary consideration of Rs.28,000/- per month and share in profits of income earned on clearances. Further investigation of tested samples from the export consignment revealed that the item attempted to be exported was actually Calcium Carbonate and not "Uric Acid" and thus there was both mis-declaration of goods and value. 2.2 The Department entertained the view that the Appellant, a CHA, did not exercise due diligence in discharging their obligations as required under the relevant provisions of Customs Broker Licencing Regulations (CBLR), 2013. Accordingly, Order of Prohibition No. 33/2017-18 dated 08.09.2017 was issued on 12.09.2017 by Mumbai Customs authorities prohibiting the operation of licence of the Appellant and a copy of which was endorsed to Chennai Customs Authorities for further action. Subsequently, Customs, Mumbai Ordered for continuation of the Order of prohibition vide order No.46/2017-18 dated 10.11.2017, ....
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....e proceedings stood abated in view of the failure of the department to issue a Show Cause Notice to the Appellant within a period of 90 days from the date of receipt of an offence report. It was pointed out that shipping bill was filed in May 2017 and the Prohibition order dated 08.09.2017 was issued by Additional Commissioner of Customs, Mumbai based on the offence report dated 14.06.2017 which was forwarded to Chennai Customs which issued SCN dated 17.12.2017 and the impugned order of revocation dated 01.06.2018 issued by the Department was beyond the mandatory time period of 90 days in terms of Regulation 20(1) and 20(5) of CBLR, 2013. iv) It was submitted that the question of following the time limits as provided under various regulations of CBLR, 2013 was mandatory or directory as decided by various judgements pronounced by various fora. In this regard reliance was placed on the following judgements: a) The ratio of the decision in the case of Commissioner of Customs Vs. Ahmed & Co., wherein the Hon'ble High Court held that the issuance of notice within 90 days was mandatory and therefore the entire proceedings stood automatically abated if no action was take....
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.....03.2018 from the date of offence report dated 14.06.2017. vi) It was argued that the impugned order failed to take into consideration the ratio of the decision in the case of Harini Freight Logistics Vs CC [2016 (343) ELT 590 (Tri.-Mum.)] and Daroowala Bros and Co. Vs. CC [2016 (333) ELT 182 (Tri.-Mum.)] as in the subject case, the Department had not alleged any misfeasance, criminality or malafide against the Appellant while the department itself admitted that there is no direct role for evasion by the Appellant and that there was no evidence that the Appellant was paid any extra money and sharing the benefits of fraudulent imports and therefore the imposition of penalty was legally not sustainable. vii) It was submitted that the Appellant was transacting business as per Rules and Regulations with an unblemished track record and never came to the adverse notice of the Customs authorities and hence the revocation of license resulted in their operations coming to a standstill. 4. Ld. Advocate for the Appellant, Shri Derrick Sam reiterating the grounds of appeal, prayed for setting aside the impugned order by relying on the following judgments: - i. Tra....
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.... 2013 by allowing Shri Ulhas Gate, Proprietor of M/s. A.P. Cargo Enterprises to use the Customs Broker Licence for a monetary consideration of Rs.28,000/- per month in addition to profit sharing on the transactions undertaken. It was found that the entire CHA business was found transacted through an employee of M/s. A.P. Cargo Enterprises viz., Shri Sadanand R Rokade who was not holding and issued with any Customs pass on behalf of the Customs Broker. The Lower Adjudicating Authority has concluded that the Customs Broker has failed in discharging their obligations as Customs Broker as required under Regulation 11(b),(d),(k),(n),17(5) and 17(9) of CBLR, 2013 as the Customs Broker has lent his Licence to M/s. A.P. Cargo Enterprises for a monthly consideration and also sharing profits of the business transacted. 10. The main argument of the appellant centred around that the Department has not adhered to the time limits prescribed for issuance of Show Cause Notice, conducting an inquiry and adjudication of the case as required under Regulation 20 of CBLR, 2013 and also as directed in Board's Circular No. 9/2010 dated 08.04.2010 which is extracted below for convenience:- "Su....
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....e Deputy Commissioner of Customs or Assistant Commissioner of Customs recording his findings on the issue of suspension of CHA license, and for passing of an order by the Commissioner of Customs. Suitable changes have been made in the present time limit of forty five days for reply by CHA to the notice of suspension, sixty days time for representation against the report of AC/DC on the grounds not accepted by CHA, by reducing the time to thirty days in both the cases under the Regulations. 7.2 In cases where immediate suspension action against a CHA is required to be taken by a Commissioner of Customs under regulation 20(2), there is no need for following the procedure prescribed under Regulation 22 since such an action is taken immediately and only in justified cases depending upon the seriousness or gravity of offence. However, it has been decided by the Board that a 'post-decisional hearing' should be given in all such cases so that errors apparent, if any, can be corrected and an opportunity for personal hearing is given to the aggrieved party. Further, Board has also prescribed certain time limits in cases warranting immediate suspension under Regulation 20(2)....
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....hin 90 days from the date of receipt of offence report, the Assistant / Deputy Commissioner of Customs nominated has to complete the inquiry and submit his report within 90 days from the date of issuance of Show Cause Notice and then after considering the inquiry report and Customs Broker's representation, the Commissioner is required to issue the order of revocation or revocation of the suspension within 90 days from the date of submission of the inquiry report. 12. Now let us examine, whether these time limits prescribed have been complied with or not in this appeal. We find that the report dated 14.06.2017 of Additional Commissioner, on violations of CBLR, 2013 by the Customs Broker as pointed out by the Appellant was mentioned at Para 12 of Prohibition order No. 46/2017-18 issued by Customs, Mumbai. However, this report dated 14.06.2017 was relevant only for the purpose of issuance of Prohibition order by Mumbai Customs in terms of Para 5.2 of the Board's Circular dated 08.04.2010 and is not the same as specified in Para 7.1 of the said Board's Circular for computation of time limit. The offence report specified in Para 7.1 relates to the report submitted by the investigatin....
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....rder dated 08.09.2017 was issued on 12.09.2017 by Mumbai Customs and was forwarded vide letter dated 15.09.2017 along with the investigation report dated 14.06.2017 to Customs, Chennai which was received on 18.09.2017. We find that Order-in-Original was issued 01.06.2018 within a period of nine months from the date of receipt of Prohibition order as stipulated under the said Board's Circular dated 08.04.2010. 15. In view of the above, we find that the proceedings for revocation of licence of the Appellant are not hit by limitation and hence the reliance placed on various decisions by the Appellant as cited in Para 3 above are not relevant for this appeal. 16.1 On the second issue of grounds for revocation of licence, the impugned order dated 01.06.2018 of the Commissioner of Customs, Chennai, the licencing authority has clearly brought out the contraventions of provisions of CLBR, 2013 by the Appellant in paragraph Nos. 12 and 13 of the order. It is to be noted that the Licensee of the Customs shall :- 1. not sell or transfer license to any other person. 2. obtain an authorization from each of the companies, firms or individuals by whom he is for the time be....
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.... importers have to deal with a multiplicity of agencies viz. carriers, custodians like BPT as well as the Customs. The importer would find it impossible to clear his goods through these agencies without wasting valuable energy and time. The CHA is supposed to safeguard the interests of both the importers and the Customs. A lot of trust is kept in CHA by the importers/exporters as well as by the Government Agencies. To ensure appropriate discharge of such trust, the relevant regulations are framed. Regulation 14 of the CHA Licensing Regulations lists out obligations of the CHA. Any contravention of such obligations even without intent would be sufficient to invite upon the CHA the punishment listed in the Regulations. ......" Blatant violation of the Customs Broker's Licensing Regulations, 2013 as committed by the appellant and M/s. A.P. Cargo Enterprises deserve no sympathy whatsoever. As such revocation of License is fully justified. 17. However, the Ld. Advocate has submitted that the appellant was innocent and was cheated by M/s. Ulhas Gate of M/s. A.P. Cargo Enterprises. We also find that Mumbai Customs has not recorded any statement from the Customs Broker viz., Shri M.R....