TaxTMI 
TaxTMI 
2026 (3) TMI 1465
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....MTs which were valued at Rs.5,54,85,000/- and were prohibited for export under the Foreign Trade Policy,. The container seal was also found tampered. The appellant in his voluntary statement admitted that he had allowed M/s TRC Shipping and Logistics Pvt Lt. to use their CHA licence, which facilitated the attempted smuggling of the prohibited goods. Following investigation and recording of statements, a Show Cause Notice (SCN), dated 02.12.2014 was issued to the parties involved, including the appellant. By the impugned Order, the Commissioner imposed a penalty of Rs.10 lakhs under Section 114(i) of the Customs Act, 1962 on the appellant for having facilitated the smuggling activities. Aggrieved by the said penalty, the appellant has filed the present appeal. 3. The learned Advocate Shri S. Murugappan appeared for the appellant and Ld. Authorized Representative Shri N. Satyanarayanan appeared for the respondent. 3.1 Shri S. Murugappan the Ld. Counsel for the appellant submitted that it is a settled legal position that penalty under Section 114 can be imposed on a third party, such as a Customs House Agent (CHA), only upon clear evidence of conscious and knowing involvement in....
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....ng attempted smuggling of prohibited goods. He stated that the charge in the present proceedings is not merely a failure under the Customs Broker Regulations but a more serious charge of facilitating the attempted smuggling of red sanders out of India and is hence rightly liable to penal action under the Customs Act 1962. He prayed that the appeals be rejected. 4. I have heard the parties to the dispute and perused the appeals and the citations mentioned. I find that the dispute relates to the penalty imposed on the CHA under the Customs Act for having facilitated smuggling activities. 5. The findings against Shri J. Arokia Manohar, Proprietor of M/s. Jeyam & Co., is that though holding a valid CHA licence, he permitted its use for export clearances filed in the name of M/s. Solar Granite Exports, Bangalore, by Shri Pandian of M/s. TRC Shipping & Logistics Pvt. Ltd., using signed Annexure-C and Shipping Bill checklists provided by him at the instance of the Director of TRC. For such permission, he received Rs.1,000 per Shipping Bill, under which two Shipping Bills were filed. He had no direct dealings with the exporter, failed to verify their credentials, and exercised no sup....
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....s a civil liability arising from a regulatory breach, the absence of words importing intention must be given due effect. 7.2 Further 'abetment' is expressly carved out as a separate and distinct limb, where elements of knowledge or intent may be relevant. To read a requirement of mens rea into the first limb would not only render the abetment clause otiose but would also extinguish the clear structural distinction consciously maintained by the legislature. Since abetment does not form part of the allegations in the OIO, that limb does not arise for consideration in the present appeal. 8. It is established from the findings in the OIO that the appellant, a licensed Customs House Agent, permitting the use of his CHA licence without due diligence and supervision, facilitated the attempted smuggling of red sanders. As a CHA, he was under a statutory obligation to act in furtherance of the objectives of the Customs Act, 1962 and to ensure lawful clearance of goods. His omissions directly contributed to the attempted illicit export, resulting in an act prejudicial to the interests of the Customs Act. The appellant's acts and omissions, read together with those of the other noticees....
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....nfiscability of export goods under section 113, renders the person concerned liable to penalty under section 114 of the Customs Act. As the appellant lent his signature, knowingly or otherwise, to the Bill of Entry that was misused for smuggling of goods which were liable for confiscation, he is rightly liable to penalty, and the appeal deserves dismissal. 10. I proceed to examine the orders and judgments relied upon by the appellant. In this context, reference is made to the judgment of the Apex Court in Escorts Ltd. Vs Commissioner of Central Excise, Delhi-II [2004 (173) E.L.T. 113 (S.C.)], wherein it was held that even a single additional or differing fact can lead to a materially different conclusion, and that cases should not be decided by mechanically relying on precedents. 10.1 In A. Elango (supra), the charge against the appellant was one of abetment that is the second limb of section 114 discussed above and not one of a CHA lending his signature for processing the Shipping Bills. The highlighted portion of para 31 of the Hon'ble Supreme Court's judgment in UNION OF INDIA Vs MUSTAFA & NAJIBAI TRADING CO. [1998 (101) E.L.T. 529 (S.C.)], cited in the said Order at parag....