Custom, Excise & Service Tax Tribunal
Shri Dev Raj Vermani vs Cce, New Delhi on 6 January, 2017
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
West Block No. 2, R.K. Puram, New Delhi 110 066.
Date of Hearing: 17.11.2016
Date of Pronouncement: 6.1.2017
Appeal No. C/44/2012
(Arising out of Order-in-Original No. RT/ACE/134/2011 dated 2.12.2011 passed by the Commissioner of Customs, New Delhi)
Shri Dev Raj Vermani Appellant
Vs.
CCE, New Delhi Respondent
Appearance Shri J.M. Sharma, Consultant - for the appellant Shri S.K. Sheoran, D.R. - for the respondent CORAM: Honble Ms. Archana Wadhwa, Member (Judicial) Honble Mr. V. Padmanabhan, Member (Technical) Final Order No. 50152/2017 Per V. Padmanabhan :
The present appeal is filed by Shri Dev Raj Vermani, who acted as Custom House Agent in certain transactions where shipping bills were filed for exportation of certain goods. The impugned order dated 2.12.2011 deals with certain improper exportation of goods by one M/s S.K. Trading. The exporter exported six consignments of goods through the appellant which were mis-declared with intent to claim higher rate of drawback. In respect of three other shipping bills which also was mis-declared, the goods were intercepted and seized by the customs. At that time, the drawback in respect of previous six exports was not paid. However, on 12.8.2011 drawback in respect of those consignments were paid which was subsequently withdrawn from the bank account by the exporter. Proceedings were initiated against both the exporter as well as appellant who acted as CHA and penalties were imposed on both of them. The present appeal is filed by CHA against the penalty of Rs.2.5 crores imposed on him.
2. The submission of the appellant is that the proprietor Shri Dev Raj Vermani, underwent by-pass surgery. During that time he had entrusted the work related to the customs to Shri Manpreet Singh, who made use of user ID and password allotted to the appellant for accessing the customs computer. The case of the department is that the CHA did not verify the antecedents of the exporter, correctness of the import export code number, identity of the exporter and their functioning, declared address etc. The adjudicating authority penalise the appellant under Section 114 (i) and 114(iii) and 117 of the Customs Act, 1962 for abetting the improper export of goods with intent to claim higher drawback.
3. In the present appeal, it has been submitted on behalf of the appellant that certain lapses occurred on the part of appellant with the norms of verifying the identity of the exporter were admitted. However, this was not done with any motive of personal gain as the CHA did not gain anything from Rs.21 lakhs received by the exporter by way of drawback. They further submitted that they had no hand in abetting the improper export of goods and hence no penalty is imposable on them under Section 114(ii) and (iii) of the Customs Act, 1962. Various case laws including the case of Nirmal Kumar Agarwal Vs. CC, Mumbai - 2013 (298) ELT 133.
4. Heard Shri J.M. Sharma, ld. Consultant for the appellant and Shri S.K. Sheron, ld. AR for the Revenue.
5. The issue for decision in the present case is limited to the imposition of penalty under Section 114(i), 114(iii) and 117. The case made against the exporter is attempted in proper exportation of goods by overvaluation with intent to claim higher amount of drawback. The relevant shipping bills filed for export were done through the appellant CHA. The main allegation against the appellant spelt out in the Show Cause Notice is that the appellant failed to verify the antecedents of the exporter, his identity and address, as was expected of CHA. It is also an admitted fact that Shri Vermani, Proprietor of the appellant firm, allowed the Customs ID and password to be utilised by Shri Manpreet Singh, who apparently handled the present export consignments. The relevant portion of Section 114 under which penalty stands imposed is reproduced below :
114. Penalty for attempt to export goods improperly, etc.Any person who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under section 113, or abets the doing or omission of such an act, shall be liable,
(i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty 1[2[not exceeding three times the value of the goods as declared by the exporter or the value as determined under this Act]], whichever is the greater;
(ii) ..............................
(iii) In the case of any other goods, to a penalty not exceeding the value of the goods, as declared by the exporter or the value as determined under this Act, whichever is the greater.
6. The allegation of the department is that the appellant has abetted in the fraudulent attempt to export inasmuch as they failed to bring to the notice of the department about the exporter. From the records, we find that the department has not brought any other evidence to prove that the appellant or his representative indulged in any activity to actively pursue the improper exportation. It stands admitted by Shri Vermani in his statements as well as in the present appeal, that there were lapses in complying with the norms regarding verification of the identity and antecedents of the exporters. However, we are of the view that such lapses are liable to be proceeded with by the Customs Department in terms of the Customs Broker Licensing Regulation, 2012. The conditions precedent for imposing penalty under Section 114 is absent in the facts of the present case. We find that the case law relied upon by the appellant in the case of Nirmal Kumar Agarwal (supra) is squarely applicable to the present case. Accordingly, we set aside the penalty imposed under Section 114
7. Penalty of Rs. one lakh has been imposed upon the appellant under Section 117 of the Customs Act, 1962. The relevant section is reproduced below.
117. Penalties for contravention, etc., not expressly mentioned.Any person who contravenes any provision of this Act or abets any such contravention or who fails to comply with any provision of this Act with which it was his duty to comply, where no express penalty is elsewhere provided for such contravention or failure, shall be liable to a penalty not exceeding 2[ten thousand rupees].
The above section provides for imposition of penalty not elsewhere specified for contravention of any of the provisions of this Act. We are of the view that the conduct of the appellant can be covered by the above section. Accordingly, we uphold the penalty imposed under Section 117 of the Customs Act.
8. In view of the above, the impugned order is modified to the extent as above.
(Pronounced in Court on 6.1.2017) (Archana Wadwha) Member (Judicial) (V. Padmanabhan) Member (Judicial) RM 6