TaxTMI 
TaxTMI 
2026 (2) TMI 484
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....business of the firm looked after by the petitioner only. A business entity named M/s. Tshochhen Trading of Bhutan owned by Sri Lhapa Tshering (hereafter "importer") had engaged the petitioner for filing necessary documentation with the Customs in respect of a Bhutan bound transhipment consignment of detergent powder imported from Malaysia in a fully sealed container. b) The petitioner was provided with the following documents for the aforesaid purpose- i) authorisation letter in favour of the petitioner, ii) import license of the importer issued by the Government of Bhutan for importing detergent powder, iii) bill of lading, iv) invoice, v) packing list and vi) KYC. c) The said transhipment was put on hold vide an alert dated June 14, 2024. The petitioner being the Customs House Agent (hereafter "CHA") provided the authorities of the Directorate of Revenue Intelligence (hereafter "DRI") copies of documents related to the import consignment including bill of lading, invoice, packing list, import license, letter of authorisation for CHA, etc, and cooperated with the investigating authorities. d) On June 24, 2024....
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....tural justice and also alleging that the petitioner had been saddled with much heftier penalty than the importer. SUBMISSIONS ON BEHALF OF THE PETITIONER: 3. A brief summary of the submissions made by Ms. Chowdhary, learned Counsel appearing for the petitioner (both orally as well as in the written notes) is as follows:- a) The order impugned is wholly unreasoned. The order in original had been copiously copied from the notice to show cause. b) There is no discussion about the matter in the order impugned. c) The order in original has been passed without application of mind to the petitioner's reply along with the supporting documents, the submissions made and the judgments cited by the petitioner. It was further submitted that the submission made by the petitioner has also not been considered. d) Penalty had been imposed upon the petitioner mechanically and arbitrarily in violation of the provisions of Sections 112(a), 112(b) and 114AA of the said Act of 1962. In support of the proposition that an order without reason and without application of mind is a nullity, the petitioner relied on the judgments of the Hon'ble Supreme Court in the ca....
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.... for "omission and commission" and "abatement" would indicate that the order has been passed in a routine manner in defiance of the Circular dated September 03, 2024 which is binding on the Customs authorities, without establishing the element of abatement by any evidence. k) The petitioner had no means to know about the misdeclaration since the subject goods which exported from Malaysia for transhipment to Bhutan were covered by Indo-Bhutan Treaty; the Bill of Lading was issued in Malaysia declaring the goods as detergent powder; the mis-declared goods i.e. poppy seeds and detergent powder were also exported from Malaysia in a sealed container with lock and the clearance of the goods was possible only against a letter of guarantee issued by the Government of Bhutan. It was submitted that it was only after the misdeclaration was discovered by the Customs authorities and the importer was examined that the importer produced a different invoice for the first time. l) As the goods were in the custody of the Customs authorities, therefore, only the Customs authorities could have opened the lock and checked the goods, so the petitioner had no means to know about the mis....
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....t the import consignment, he had called the importer Shri. Lhapa Tshering to Kolkata to be present for the examination and prior to the day of the examination he was supposedly informed by the importer that the imported containers contained poppy seeds. The petitioner had further stated during examination that he did not possess any document related to the import consignment apart from the Bill of Lading and authorisation letter as Shri. Lhapa had told him that the documents were being processed. h) The voluntary statement of Shri Koushik Basak, Senior Executive of M/s. Expressway Containers LLP made on June 28, 2024 was referred to point out that the said person had stated that on June 10, 2024 the shipping agency had received an e-mail on its official e-mail ID from the petitioner asking for delivery of the container documents related to the import consignment. i) It was asserted that Poppy Seeds are highly restricted as per DGFT Notification No. 54/2015-20 dated February 09, 2022 of delivery of the containers documents relating to import consignment and in the instant case Poppy Seeds have been illegally imported into India under the guise of detergent powder t....
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....able to pay penalty under Section 114AA of the said Act of 1962, since he had knowingly and intentionally submitted forged and false documents for the purpose of clearance of the import container from the shipping agent. p) It was argued that all the acts of omission and commission as well as abetment in respect of the writ petitioner would be evident from the findings of the adjudicating authority in the order in original as well as from the statements of Shri Lhapa Tshering and Shri Koushik Basak. q) It was submitted that there was no infirmity and/or procedural lapse in the decision making process and the petitioner's allegation that the order impugned is merely a copy paste of the show cause notice is baseless and unfounded. r) A judgment of the Hon'ble Division Bench of this Court in the case of Sai-Dutta Clearing Agency Private Limited vs. Union of India (2024) 19 Centax 222 (Cal.) was cited in support of the contention that the adjudicating authority has imposed the penalty rightly under Section 112 of the said Act of 1962. s) It was submitted that the writ petition should be dismissed. 5. Learned Counsels for both parties distinguished....
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....le has been pivotal in the attempted smuggling of poppy seed in guise of mis-declared transhipment consignment of Shri Lhapa Tshering. Shri Bikash Bose, a registered Customs Broker, had been authorized by Shri Lhapa Tshering to handle the clearance of the Bhutan bound transhipment consignment imported by the latter. However, investigation revealed that Shri Bikash Bose clearly had a larger role to play in the import of the mis-declared consignment. Shri Lhapa Tshering mentioned in his voluntary statement that he had assigned the job of customs clearance of the impugned consignment to M/s J B Shipping Agency, operated through its G Card holder Shri Bikash Bose, an old acquaintance of his. As per Shri Lhapa Tshering, Shri Bikash Bose was also supposed to arrange for the transporter to take the consignment to Bhutan. Further, in his voluntary statement, Shri Bikash Bose initially attempted to feign ignorance regarding the imported consignment, but his submissions were revealed to be false through further inquiry with the shipping agent and the importer Shri Lhapa Tshering, Shri Bikash Bose tried to mislead the investigation by stating he did not have any documents in relation to the c....
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....ly planning to use the same forged documents to get customs clearance of the goods if it weren't interdicted by the DRI." 12. On the basis of the aforesaid allegations, the following findings were arrived at by the adjudicating authority:- "i. Shri Bikash Bose had a pivotal role in attempted smuggling of poppy seeds in guise of mis-declared transhipment consignment of Shri Lhapha Tshering, proprietor of M/s Tshochhen Trading. ii. Shri Bikash Bose tried to mislead the investigation by stating that he did not have any documents in relation to the consignment other than Original BL and authorization. He further stated that importer had told him that all other documents are being processed, however, inquiry with the shipping agent revealed that Shri Bikash Bose was already in receipt of the Original Bill of Lading and other forged documents having false details about the content of the imported container. iii. Shri Bikash Bose was actively pursuing the clearance of the import container independently, in absence of any directions from the importer. iv. Shri Bikash Bose had already proceeded towards getting the container released from the shipping a....
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....ng reasons therefor. 16. It is evident that the adjudicating authority has disbelieved the explanation of the petitioner. However, acting in a quasi-judicial capacity, the adjudicating authority was required to provide a reasoned basis for rejecting the petitioner's explanation, especially when imposing a penalty in a quasi-criminal proceeding. All the more so, since it was the case of the Customs authorities themselves in the show cause notice (as well as in paragraph 2.2 of the order in original) that "Before the examination procedures started, the CHA provided copies of documents related to the import consignment, including the Bill of Lading, Invoice, Packing List, Import License, Letter of Authorisation for the CHA, etc.". 17. Similarly, while the adjudicating authority has drawn adverse inference against the petitioner for the petitioner actively pursuing the clearance of the import container independently, the adjudicating authority has lost sight of the clarifications provided by Circular No. 119/13/2009-S.T. dated December 21, 2009 issued by the Central Board of Excise and Customs, paragraph 2 whereof reads thus:- "2. While the principal job of a CHA is ....
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.... subject to the provisions of Section 114-A, to a penalty not exceeding ten per cent of the duty sought to be evaded or five thousand rupees, whichever is higher: Provided that where such duty as determined under subsection (8) of Section 28 and the interest payable thereon under Section 28-AA is paid within thirty days from the date of communication of the order of the proper officer determining such duty, the amount of penalty liable to be paid by such person under this section shall be twenty-five per cent of the penalty so determined;] [(iii) in the case of goods in respect of which the value stated in the entry made under this Act or in the case of baggage, in the declaration made under Section 77 (in either case hereafter in this section referred to as the declared value) is higher than the value thereof, to a penalty not exceeding [* * *] the difference between the declared value and the value thereof or [five] thousand rupees, whichever is the greater; (iv) in the case of goods falling both under clauses (i) and (iii), to a penalty not exceeding [* * *] the value of the goods or [* * *] the difference between the declared value and the value there....
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....107 of the Indian Penal Code had been taken into consideration by the Hon'ble Delhi Court and based thereon the aforesaid observation had been made. The judgment delivered in the case of Shree Ram v. State of U. P., reported in (1975) 3 SCC 495 and the judgment delivered in the case of Amritlakshmi Machine Works v. The Commissioner of Customs (Import), Mumbai, reported in 2016 (335) E.L.T. 225 (Bom.) were also taken note of, and proceeding on such premise it had held that mere facilitation without knowledge would not amount to abetting an offence. Admittedly, in this case I find that although, diverse materials have been considered, there appears to be no finding by the adjudicating officer so as to implicate the petitioner of having involved with the notice and knowledge that the goods in question had been mis-declared. It is true that the adjudicating authority had returned the finding that the petitioner played an instrumental role in abetting smuggling. However, mere use of the word abetment or abetting smuggling, in my view, would not suffice unless a clear finding implicating the petitioner to have committed the act of omission or commission with the knowledge of the....