Custom, Excise & Service Tax Tribunal
M/S Pt Varghese & Company vs Central Board Of Indirect Taxes And ... on 3 September, 2024
C/20377, 20376/2024
CUSTOMS, EXCISE & SERVICE TAX APPELLATE
TRIBUNAL
BANGALORE
REGIONAL BENCH - COURT NO. 1
Customs Early Hearing Application No.20286 of 2024
Customs Misc. Application No. 20287 of 2024
in
Customs Appeal No. 20377 of 2024
(Arising out of Order of Suspension No. S9/5/1977 I&B Cus Pt. II
dated 27.06.2024 passed by the Commissioner of Customs, Cochin.)
M/s. PT Varghese and Company
Ground Floor, Unity Centre, Appellant(s)
Railway Goods Shed Road,
Willingdon Island,
Cochin.
VERSUS
Commissioner of Customs
Customs House, Willington Island,
Cochin - 09.
Respondent(s)
And Customs Early Hearing Application No.20288 of 2024 Customs Misc. Application No. 20289 of 2024 in Customs Appeal No. 20376 of 2024 (Arising out of Order of Suspension No. S9/26/86 I&B Cus Pt. II dated 27.06.2024 passed by the Commissioner of Customs, Cochin.) M/s. Premier Shipping Agencies, 1st Floor, Handicrafts Building, Near Aghil Appellant(s) Building, Indira Gandhi Road, Willingdon Island, Cochin - Cochin - 682 009.
VERSUS Commissioner of Customs Customs House, Willington Island, Respondent(s) Cochin - 09.
APPEARANCE:
Mr. Baby M.A, Advocate for the Appellant Mr. K.A. Jathin, Authorised Representative for the Respondent CORAM: HON'BLE DR. D.M. MISRA, MEMBER (JUDICIAL) HON'BLE MRS R BHAGYA DEVI, MEMBER (TECHNICAL) Page 1 of 6 C/20377, 20376/2024 Final Order No. 20792 - 20793 /2024 DATE OF HEARING: 03.09.2024 DATE OF DECISION: 03.09.2024 PER : R BHAGYA DEVI Appellants have filed miscellaneous applications for early hearing of their appeals and for restoration of customs broker licence. Since the issue lies in a short compass, appeals itself are taken up for final disposal, therefore, all the miscellaneous applications are dismissed.
2. These two appeals are filed against Order of Suspension dated 27.06.2024 against the appellants M/s. P.T. Varghese & Company (Appellant-1) and M/s. Premier Shipping Agencies (Appellant-2). In both the cases, there was violation of Baggage Rules, 2016 wherein the appellants included the baggages of some unknown clients along with the accompanied baggage of the passenger for availing undue benefits.
3. The appellant 1 who is a customs broker had filed a baggage clearance under Transfer of Residence (TR) for 45 packages of personal effects and household goods in the name of Mr. Yoonus Kallivalappil and had misused the provisions of Baggage Rules, 2016. When the officers of Customs examined these 45 packages, it revealed that the goods were mis-declared in description, value and quantity in violation of the provisions of Baggage Rules, 2016 read with Customs Act, 1962. It was also found that the baggage of two unknown persons were also included in the above baggages which was being cleared under the name of Mr. Yoonus Kallivalappil in violation of provisions of the Baggage Rules, 2016 read with Customs Act, 1962. The appellant-2 filed the baggage declaration under Transfer of Residence (TR) of personal effects and household goods in the name of Shri Suresh Kairpoth containing 36 packages. On examination, it was found that it contained 12 packs of e-cigarettes, a prohibited item and also the inventory filed by the Page 2 of 6 C/20377, 20376/2024 appellant revealed misdeclaration in description, value and quantity of the consignment, in violation of the provisions of Baggage Rule, 2016 read with Customs Act, 1962. In view of the above violations of Regulation 10(d) and 10(e) of Customs Brokers Licensing Regulations (CBLR), 2018, the Commissioner in the impugned order under Regulation 16 of the CBLR, 2018 suspended the license of both the appellants vide suspension order dated 27.06.2024. Aggrieved by this, appellants are in appeal before us.
4. The Learned Counsel on behalf of both the appellants submits that in similar cases of violation, orders were passed by the officers concerned by releasing the goods by imposing penalty under Section 112 and Section 114AA of the Customs Act, 1962 to the concerned passengers who had cleared the goods under Baggage Rules, 2016; therefore, the suspension of license is not warranted. It is also submitted that the clearance activities relating to the unaccompanied baggage were filed as per the declaration given by Shri Yoonus Kallivalappil and Shri Suresh Kairpoth, who had no knowledge that it included goods of other individuals also. Hence, there was no irregularity on their part and prayed for setting aside of the suspension orders dated 27.06.2024.
5. Countering the above submissions, the learned Authorised Representative submitted that there is no dispute that the declarations filed by the appellants in the name of Shri Yoonus and Shri Suresh Kairpoth included the baggage of other unknown persons only to claim the benefit of unaccompanied baggage. It is also submitted that in one of the cases, e-cigarettes, a prohibited item was included. The Commissioner had followed the relevant procedures complying with the provisions of the CBLR, 2018 and therefore, suspension order issued against the appellants is legal, reasonable and justifiable.
Page 3 of 6C/20377, 20376/2024
6. Heard both sides. Customs Brokers Licensing Regulations, 2018, clause 16 reads as:
"16. Suspension of license.--(1) Notwithstanding anything contained in regulation 14, the Principal Commissioner or Commissioner of Customs may, in appropriate cases where immediate action is necessary, suspend the license of a Customs Broker where an enquiry against such Customs Broker is pending or contemplated: Provided that where the Principal Commissioner or Commissioner of Customs may deem fit for reasons to be recorded in writing, he may suspend the license for a specified number of Customs Stations. (2) Where a license is suspended under sub-regulation (1), the Principal Commissioner of Customs or Commissioner of Customs, as the case may be, shall, within fifteen days from the date of such suspension, give an opportunity of hearing to the Customs Broker whose license is suspended and may pass such order as he deems fit either revoking the suspension or continuing it, as the case may be, within fifteen days from the date of hearing granted to the Customs Broker: Provided that in case the Principal Commissioner of Customs or Commissioner of Customs, as the case may be, passes an order for continuing the suspension, further procedure thereafter shall be as provided in regulation 17.
17. Procedure for revoking license or imposing penalty.-- (1) The Principal Commissioner or Commissioner of Customs shall issue a notice in writing to the Customs Broker within a period of ninety days from the date of receipt of an offence report, stating the grounds on which it is proposed to revoke the license or impose penalty requiring the said Customs Broker to submit within thirty days to the Deputy Commissioner of Customs or Assistant Commissioner of Customs nominated by him, a written statement of defense and also to specify in the said statement whether the Customs Broker desires to be heard in person by the said Deputy Commissioner of Customs or Assistant Commissioner of Customs.
As seen above under Regulation 16 of CBLR, 2018, the Authorities are authorised to take immediate action to suspend the license where an enquiry against such customs broker is pending or contemplated. Similarly, Regulation 17 provides for detailed procedure to proceed against the Customs Broker after following the timelines. There is no dispute that the declarations filed by the appellants included baggage's of others who were Page 4 of 6 C/20377, 20376/2024 not eligible for the benefit of Transfer of Residence (TR) under the Baggage Regulations, 2016. In fact, on examination of the consignments, it was clearly established that 12 packs of e-cigarettes, a prohibited item was also a part of the consignment. Therefore, there is a clear misdeclaration and misuse of the benefit given under the Baggage Regulations, 2016. Moreover, the learned counsel has no grievance that principle of natural justice was not followed. The Commissioner after duly complying the provisions of the CBLR, 2018 by issuing a seizure memo and providing them a personal hearing had suspended the license for the reasons discussed above.
7. The Hon'ble High Court in the case of Sindhu Cargo Services Ltd. vs. Commissioner of Customs, Coimbatore 2006 (203) E.L.T. 218 (Mad.) dated 3-2-2006 observed as follows:
"11. In the instant case while the first respondent proposed to pass an order of suspension has clearly observed in paragraph 10 and 11 of the order what facts and circumstances of the case warranted the first respondent to initiate the proceedings for suspension of the licence, which warranted the first respondent to pass an order of suspension pending cancellation proceedings under Regulation 20(2). Once the respondents are satisfied that prima facie case is made out to initiate cancellation proceedings under Regulation 22(1), consequently an order passed under Regulation 20(2) for suspending the licence pending such cancellation proceedings cannot be construed as a punishment by itself, inasmuch as the power conferred under Regulation 20(2) empowers the first respondent to pass an order of suspension pending enquiry, having satisfied that an immediate action is necessary for the reasons mentioned in the order itself.
12. An order of suspension, pending enquiry, passed under Regulation 20(2) cannot be construed as an order of punishment nor as an order of suspension, which deals only the substantial punishment, intended in Regulation 22(1) nor such an order of suspension, pending enquiry, would stand as a stigma on the Page 5 of 6 C/20377, 20376/2024 appellant while the respondent proposed to pass final orders by following the procedure prescribed under Regulations. Therefore, the reference to Section 22(1) of the said Regulation and the context made in that regard by the learned counsel for the appellant is totally misnomer, inasmuch as the interim suspension passed under Regulation 20(2) pending cancellation proceedings shall not an order of punishment".
8. In view of the above, we do not find any reason to set aside the impugned orders. Consequently, both the appeals are dismissed.
(Operative portion of the order was dictated and pronounced in Open Court on 03.09.2024.) (D.M. MISRA) MEMBER (JUDICIAL) (R BHAGYA DEVI) MEMBER (TECHNICAL) rv Page 6 of 6