TaxTMI 
TaxTMI 
2025 (11) TMI 705
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....t the Appellant Customs Broker is operating under a valid Customs Broker Licence issued in terms of Regulation 8 of CHALR, 2004. The Docks Intelligence Unit, Custom House, Chennai (DIU) in the course of investigation into a case of attempted smuggling of a Red Sanders in the guise of Mild Steel Round Pipes vide Shipping Bill No. 9880221 dated 05.02.2014 in respect of the exporter Dharranee Roofing Plant P Ltd, found that the appellant has acted as customs broker for clearance of the said export shipment. During the course of investigation by the DIU, statements were recorded from the appellant's Managing Director and Branch Managers at Coimbatore and Chennai. The offices of the appellant at Chennai and Coimbatore were searched and documents relevant to the shipments pertaining to the said exporter Dharranee Roofing Plant Private Limited, Coimbatore were recovered and seized. Evidence gathered by DIU appeared to reveal that one Sri Badri K Narayanan who had introduced himself to the exporter as the buying agent of SVM Impex was suspected to be the main culprit in the said attempted smuggling, and was not traceable. Pursuant to the investigation, the Department alleged that the appel....
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....sued to them should not be revoked and security deposit should not be forfeited or penalty should not be imposed upon them under Regulation 18 of the CBLR 2013 for their failure to comply with the provisions of CBLR 2013. The customs broker was asked to submit their statement of defence to the inquiry officer appointed under Regulation 20 of the CBLR 2013. The Inquiry Officer submitted the inquiry report on 28-05-2015 concluding that the customs broker had failed in fulfilling the obligations cast upon them under 11 (a) and 11 (d) and found that they had not violated Regulations 11 (e) and 11 (n) of the CBLR 2013. 7. The appellant was granted a personal hearing on 22-09-2015 by the Commissioner of Customs in Chennai -VIII, the Licensing Authority. After going through the records of the case, Inquiry report, the written submissions, and oral submissions made at the time of personal hearing, the said Licensing Authority passed OIO No. 47539/2016-17 dated 06-06-2016. The authority found that though the appellant had not fulfilled their obligations under Regulation 11(d), the appellant had substantially complied with the provisions of Regulations 11(a) and 11(n) of CBLR-2013. The sa....
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.... c. The provisions relating to regulation 11(d) have no application in the present set of facts, and invocation of this regulation is misconceived. It is submitted that, in this case, as there was no occasion to notice any contravention of the law by the exporter, there did not arise the need to advise them to comply with the law. d. The goods were stuffed in the presence of Central Excise officials and there is no evidence to establish connivance on the part of the appellants with the smugglers of red sanders in the substitution of the cargo. In this regard, the appellants rely upon the judgement of the jurisdictional High Court in the case of Transport Logistics reported in 2016(338) E.L.T 380(Mad). 11. Ld. Advocate prays that the order of the appellate authority to the extent it directs for the forfeiture of the security deposit may be set aside and justice rendered. He placed reliance on the decisions in:- a. Santon Shipping Services Vs. The Commissioner of Customs, The Customs Excise and Service Tax Appellate Tribunal reported in 2017 (10) TMI 621 - Madras High Court, b. Commissioner of Customs, Chennai - VIII Vs. Trishiv Logistics Pvt Ltd.,....
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....gency, i.e. DIU, informed the licencing authority. It is seen that this stand of the appellant was noted by the licensing authority in para 17.2 when the show cause notice dated 02.06.2014 was issued under the provisions of regulations 18 of the CBLR, 2013 read with Regulation 20 of the CBLR 2013. Yet, the SCN continued to be non-transparent and did not disclose the date of receipt of the offence report. The appellant continued to reiterate the aforesaid submissions before the Inquiry Officer as well as before the adjudicating authority. 16. Even in the inquiry report, as well as in the impugned Order in Original, the Department has chosen to be silent on this crucial aspect. When the authorities, despite the repeated protestations of the appellant on this ground, even after recording the same in the inquiry report as well as the SCN issued proposing to proceed under Regulations 18 and 20 of the CBLR 2013, choses to not disclose the date of receipt of the offence report by the licencing authority/Commissioner of Customs even in the impugned OIO adjudicating the matter; it merits an adverse inference on this aspect being drawn against the Department. 17. The mandate of Regulat....
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....t Regulation 20 (1) of CBLR 2013 in the instant case is pari materia with Regulation 22(1) ) CHALR, 2004 which considered by the Honourable High Court above, we have no hesitation in holding that the time limit prescribed under the said Regulation 20 (1) is mandatory. In our considered view, once the limitation prescribed under the said Regulation 20 (1) is mandatory, it was incumbent upon the SCN issuing authority to evidence that the mandated time limit has been adhered to. That is to say, the authority issuing the notice invoking Regulation 20 (1) of the CBLR 2013, proposing revocation of the licence issued to the Customs Broker and proposing imposition of penalty, is required to state the date of receipt of offence report by the said authority, when it issues such notice. 20. Viewed from any angle, be it in terms of procedural fairness or in terms of interest of justice, it is a necessary and vital information to be provided. Authorities in positions of power cannot be opaque and cannot refrain from disclosing such important information, moreso when the power being exercised under regulation 20 (1) is to visit the Customs Broker with enormous consequences including crippling....