Custom, Excise & Service Tax Tribunal
M/S Cma Cgm Agencies (India) Pvt. Ltd vs Commissioner Of Customs (Import), ... on 24 July, 2014
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. IV Appeal No. C/86963/14 (Arising out of Order-in-Appeal No. 1329(Import Noting)/2014(JNCH)/ IMP-1277 dated 19.3.2014 passed by the Commissioner of Customs (Appeals), Nhava Sheva). For approval and signature: Honble Shri Anil Choudhary, Member (Judicial) ======================================================
1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2. Whether it should be released under Rule 27 of the : Yes CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordships wish to see the fair copy : Seen of the order? 4. Whether order is to be circulated to the Departmental : Yes authorities? ====================================================== M/s CMA CGM Agencies (India) Pvt. Ltd. Appellant Vs. Commissioner of Customs (Import), Nhava Sheva Respondent Appearance: Shri S.N. Kantawala, Advocate for Appellant Shri Ahibaran, Addl. Commissioner (AR) for Respondent CORAM: SHRI ANIL CHOUDHARY, MEMBER (JUDICIAL) Date of Hearing: 24.07.2014 Date of Decision: 24.07.2014 ORDER NO. Per: Shri Anil Choudhary
The appellant M/s CMA CGM Agencies (India) Pvt. Ltd. is a shipping agent engaged in the business of providing service to shipping line by way of filing IGM on its behalf and also assisting in moving the unloaded cargo i.e. movement of containers from port to the designated CFS as instructed by the shipping line. The appellant has filed present appeal aggrieved by the order dated 19.3.2014 of the Commissioner of Customs (Appeals) whereby a penalty of Rs.1 lakhs imposed on the appellant under Section 117 of the Customs Act, 1962 has been confirmed by partly allowing the appeal and reducing the quantum of penalty from Rs.1 lakh to Rs.50,000/-.
2. The brief facts as stated by the appellant are that normally after unloading of the containers from the shipping line, the shipping line are supposed to dispatch the container as per indication, to CFS mentioned in the IGM. It is obligatory on part of the shipping line to indicate in the IGM, as to each particular container that it is going to which CFS within the facility available to importer and CHA. That in case they want to take the container to a different CFS, they have to approach the concerned shipping agent in writing at least 72 hours in advance. The relevant portion of the Facility Notice No. 69/2011 is reproduced as under: -
All Shipping Lines/Steamer Agents will be required to compulsorily indicate in the IGM against each line, the name code of the Container Freight Station (the name code will be as per Facility Notice No. 45/2011 dated 29.3.2011), opted for and intimated by the importers/CHAs for delivery of their imported cargo. For this purpose, the importers/CHAs are advised to intimate the shipping line/agents about their option of the destination CFS, atleast 72 hours prior to the arrival of the vessel (Entry inward). Where intimation regarding the destination CFS is not received from the importers/CHAs, prior to 72 hours of the arrival of the vessel (entry inward), the Shipping Lines/Steamer Agents may declare the name of any one Container Freight Station (in the IGM), to where all such unlisted containers can be transported for delivery and inform such CFS accordingly. 2.1 Further facts are that one M/s Bhatia Shipping Pvt. Ltd. had filed some complain with the Customs authority on 5.7.2012 stating that the appellant shipping agent has denied or refused to move the containers to the CFS of the importers choice. Based on such complain, a show-cause notice dated 9.8.2012 was issued without enclosing a copy of the complain, and asked the appellant to show cause as to why penalty should not be imposed under Section 117 of the Customs Act for contravention of the Facility Notice dated 5.2.2011 and as to why the registration of the appellant with the Customs department for the purpose of shipping line/agent accorded under Section 30 of the Customs Act should not be cancelled. Vide Order-in-Original dated 28.3.2013 holding that the appellant was guilty of violating the Facility Notice, a penalty of Rs.1 lakhs was imposed under Section 117 of the Customs Act with the warning that in case of repeat of similar act in future, the registration of shipping line-appellant with the department shall be liable to be suspended. Being aggrieved the appellant preferred the appeal before the Commissioner (Appeals), who have upheld the finding of the adjudicating authority in Order-in-Original but was pleased to reduce the penalty from Rs.1 lakh to Rs.50,000/-. Being aggrieved the appellant is in appeal before this Tribunal.
3. The appellant states that under the condition of contract of the shipping line, which is owner of the container, the appellant is under obligation and duty bound to return the containers removed from the Port, back to the shipping line within a period of six months. For this purpose, the appellant have also entered a running Bond with the Customs Department to ensure that the containers taken out of the port (inland) are to be exported within a span of six months, failing which customs duty attracts on such imported containers, for which under terms of contract, the appellant become liable. Thus, in order to protect its interest, the appellant charges an amount of Rs.2500/- per container to ensure the return, as it has to employ additional resource of manpower to monitor the container which goes other CFS than the regular CFS of Shipping line. Further, in case the container is lost or untraceable subsequently, the appellant is liable for cost of the container other than import duty on the container along with fine and penalty. The appellant further draws my attention that the show-cause notice is vague as the gist of allegation against the appellant i.e. the gist of the complaint letter is not furnished. The appellant further draws my attention to letter dated 18.9.2012 requesting the concerned authority for a copy of the complaint letter so as to give the proper and effective reply to the show-cause notice, which was never provided inspite of the request. It is further contended that the show-cause notice is vague and the whole proceedings is vitiated. The appellant has further raised the ground that Section 117 of the Customs Act provides for imposition of penalty not exceeding Rs.1 lakh on a person, who has contravened the provisions of Customs Act or on a party in such contravention or fails to comply any provisions of the Act, which it was duty bound, and where no express penalty is elsewhere provided for such contravention. There being no contravention of the Customs Act, the penalty is not imposable.
4. The learned AR appearing for the Revenue relies on the impugned order. He further explains that Facility Notice in question was issued under Section 141(2) of the Customs Act, which laid down certain procedure for movement of containers to the CFS to facilitate the movement of the cargo.
5. Having considered the rival contentions and on perusing of copy of the Facility Notice No. 69/2011, I find that it nowhere refers to the Section141(2) of the Customs Act. Further, in the facts and circumstances, I find that the show-cause notice is vague, as the gist of allegation and period is not found mentioned. The whole proceedings vitiated for lack of proper show-cause notice. Thus, I hold that the notice is vague and I set aside the impugned order as well as the Order-in-Original imposing the penalty on the appellant. Thus, the appeal is allowed in favour of the appellant with consequential relief, if any.
(Dictated and pronounced in Court) (Anil Choudhary) Member (Judicial) Sinha 1