TaxTMI 
TaxTMI 
2025 (4) TMI 1604
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....ARM had conducted an analysis of the data of the GST registrants and identified risky exporters who may have been involved in IGST refund frauds. DGARM also identified the Customs Brokers who handled exports of such exporters including the appellant. DGRAM got the existence of some of these exporters verified from field formation and found that they were not existence. Based on the analysis, DGARM wrote to the concerned commissioners including the respondent herein to take action under the Customs Broker Licensing Regulations. Accordingly, a show cause notice dated 30.12.2020 [SCN] was issued to the respondent which culminated in the impugned order. 3. As per the SCN the appellant had handled exports in respect of 38 suspected exporters listed in table 1 of the SCN. Of these, physical verification was conducted only in respect of four viz., M/s M.K. Traders, M/s Skybridge Traders, M/s Son Industries and M/s Vision Export and Trading Company through the GST officers. The reports of the Assistant Commissioner who had conducted the verification were as follows: "(i) M/s M.K. TRADERS (07DOAPM5686H1ZL) Remarks of jurisdictional officer (RUD-I): "During physical veri....
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.... 50,000/- on M/s Prahlad Singh. 8. Aggrieved, the appellant filed this appeal. Submissions of the appellant 9. Learned counsel for the appellant made the following submissions: (i) After GST has been introduced no shipping bill could be processed without mentioning the GST number in the shipping bill which was valid at the time of export; (ii) The GST refunds are also credited automatically to the account of the exporter which is registered via an authorised dealer's code with the department; (iii) Mere non-traceability, as alleged, of the exporter is no basis to assume that the exports were fraudulent and exporter was ineligible for IGST refund; (iv) Regulation 10(n) mandates the Customs Broker to verify the identity of the importer by way of independent documentation and the appellant ad done so. All the documents which were collected from the exporters at the time of processing of shipping bills were submitted during the adjudication proceedings; (v) The only thing against the appellant is a report by DGARM that the exporters were found to be non-existent which is not on the basis of any evidence; (vi) Even if the ex....
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....onducted only in respect of four exporters, namely, M/s M.K. Traders, M/s Skybridge Traders, /s Son Industries and M/s Vision Export and Trading Company. The charge against the appellant is that it had violated regulation 10(n) of CBLR 2018. Regulation 10 places several obligations on the licensed Customs Broker. Clause (n) requires the Customs Broker to verify correctness of importer exporter code number, goods and services tax identification number (GSTIN), identity of its client and functioning of its client at the declared address using reliable independent authentic documents, data or information. 13. It requires the Customs Broker to verify correctness of Importer Exporter Code (IEC) number, Goods and Services Tax Identification Number (GSTIN), identity of his client and functioning of his client at the declared address by using reliable, independent, authentic documents, data or information. This obligation can be broken down as follows: a) Verify the correctness of IEC number b) Verify the correctness of GSTIN c) Verify the identity of the client using reliable, independent, authentic documents, data or information d) Verify the functi....
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....he Court shall also presume that any officer by whom any such document purports to be signed or certified, held, when he signed it, the official character which he claims in such paper." 15. The onus on the Customs Broker cannot, therefore, extend to verifying that the officers had correctly issued the certificate or registration. Of course, if the Customs Broker comes to know that its client has obtained these certificates through fraud or misrepresentation, nothing prevents it from bringing such details to the notice of Customs officers for their consideration and action as they deem fit. However, the Customs Broker cannot sit in judgment over the certificate or registration issued by a Government officer so long as it is valid. In this case, there is no doubt or evidence that the IEC, the GSTIN and other documents were issued by the officers. So, there is no violation as far as the documents are concerned. 16. The third obligation under Regulation 10(n) requires the Customs Broker to verify the identity of the client using reliable, independent, authentic documents, data or information. In other words, he should know who the client is and the client cannot be some fictitio....