Custom, Excise & Service Tax Tribunal
M/S Soham Logistics Pvt. Ltd vs Commissioner Of Customs (Export), ... on 21 December, 2009
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. IV Appeal No. C/1180 & 1181/08 (Arising out of Order-in-Original No. 101/2008 dated 8.8.2008 & 100/2008 dated 7.8.2008 passed by the Commissioner of Customs (Export), Nhava Sheva). For approval and signature: Honble Shri Ashok Jindal, 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 Soham Logistics Pvt. Ltd. Appellants Vs. Commissioner of Customs (Export), Nhava Sheva Respondent Appearance: Shri S.N. Kantawala Advocate for Appellants Shri S.S. Katiyar SDR for Respondent CORAM: SHRI ASHOK JINDAL, MEMBER (JUDICIAL) Date of Hearing: 08.12.2009 Date of Decision: .12.2009 ORDER NO. WZB/MUM/2009 Per: Shri Ashok Jindal, Member (Judicial)
These appeals filed by the CHA against the imposition of penalty of Rs.50,000/- under Section 114(iii) of the Customs Act, 1962.
2. The facts of the case are that the exporter M/s Reliance Industries Ltd. filed two shipping bills for export of 82 packages of Polyester partially oriented yarn and 20 packages of PET Resin Relpet chips through their CHA (the appellants). The factory-stuff containers were offloaded in the port late on 23.12.2006 and were gated in on the same day, but due to the Holiday in Customs office on 24 & 25.12.2006, the Let Export Order (LEO) was obtained only on 26.12.2006. In the meantime, the containers were loaded on the vessel on 25.12.2006 and the same was sailed on 25.12.2006. The main contention of the CHA is that they try to contact shipping line but they did not respond. It is admitted fact that the factory stuff containers were gated in on 23.12.2006 and the same were loaded on the vessel on 25.12.2006 and the vessel sailed on the same day without shipping bill and LEO from the proper officer. A show-cause notice was issued alleging that the exporter did not produce the shipping bill to the proper officer in respect of the said goods which were to be exported out of India by the vessel Emirates Freedom Voy 551W and hence, the said goods were not cleared by the proper officer for exportation. The said goods were neither accompanied by a shipping bill nor by a boat-note but were loaded on the said vessel without the supervision of the proper officer. The person-in-charge of the vessel permitted loading of the goods, which were not accompanied by a shipping bill duly passed by the proper officer was produced by the exporter. Thus, they, in relation to the said goods, appear to have done or omitted to do any acts, which have rendered the said goods liable to confiscation under the provisions of Section 113(f) and (g) of the Customs Act, 1962. The exporter M/s Reliance Industries Ltd., the shipping line M/s Emirates Shipping Lines, the CHA M/s Soham Logistic Pvt. Ltd. appear to have violated the above mentioned provisions of the Customs Act, 1962, thus rendering the export goods totally valued at Rs.41,60,336/- FOB liable for confiscation under the provision of Section 113 (f) and (g) of the Customs Act, 1962. They also appear to have rendered themselves to penalty under the provision of Section 114(iii) of the Customs Act, 1962.
3. During the course of adjudication, the Commissioner found that the e.mail dated 22.12.2006 from the CHA (appellant) to the Steamer Agent M/s Emirates Shipping Lines is available on record wherein the CHA had forwarded the list of containers with the request to please include the following containers in the loading list per vessel Emirates Freedom-V-0651. After the list of container at the end of e.mail the CHA had instructed all the above containers will be offloaded in port before the cut off and shipping bill will be handed over at JNPT as early as possible. Thus, as the CHA failed to get the goods assessed prior to export and failed to obtain the LEO before the goods were loaded on Board and exported, I find that they are certainly liable for penalty under Section 114 of the Customs Act, 1962, in as much as their omission had rendered the goods liable for confiscation under Section 113(g) ibid. The Commissioner, on the basis of the above findings, imposed a penalty of Rs.50,000/- on the CHA. Aggrieved from the same, the CHA is before me.
4. Shri S.N. Kantawala, learned Advocate for the appellants appeared before me and submitted that the goods were factory stuffed and the containers were gated in on 23.12.2006 and thereafter the CHA has no control on the goods and they are not allowed to enter to the port area also to verify whether the goods are being loaded or not. The CHA is an agent of the exporter and he works on behalf of the exporter and he took due precautions to obtain the LEO but due to holiday on 24 & 25.12.2006, the LEOs were not obtained and they were only obtained on 26.12.2006 and the same were handed over to the shipping line and CHA came to know that the vessels has been sailed on 25.12.2006 and before that CHA tried to contact the shipping line but they did no respond. Moreover, CHA through their e.mail already gave a list to the shipping line that the shipping bill will be handed over at JNPT as early as possible. The adjudicating authority has not penalized the exporter on whose behalf the appellants are working, hence, the penalty on the appellants should not be imposed. He further relied on the observations made by the Commissioner with regard to the exporters, which are reproduced here as under: -
However, the exporters contention that they had complied with all the provisions of the law and hence are not liable for penal action appears to have adequate force. I find that they had not faulted or played any role in the loading of the container on board the vessel without LEO. The delay on the part of the CHA and the omissions and commissions on the part of the Shipping Lines which rendered the subject goods liable for confiscation are beyond the control of the exporter. But the goods were loaded on the vessel without the permission of the proper officer are offended goods and hence are liable for confiscation in terms of Section 113(g) of the Customs Act, 1962 as already discussed above. In view of the above submissions, he prayed that the penalty imposed on the appellants be waived.
5. On the other hand, the learned SDR submitted that it is the duty of the CHA to be vigilant not to load the goods on the vessel without obtaining the LEO and the CHA along with shipping line, both are liable for penalty. To support his contention, the SDR relied on the following case laws: -
(i) M/s Sudarshan Cargo Pvt. Ltd. & Other Vs. Commissioner of Customs (Export), Nhava Sheva vide Order No. A/404-405/09/SMB/C-IV dated 29.7.2009.
(ii) LMJ International Ltd. Vs. Commissioner of Customs (Export), Nhava Sheva 2008 (224) ELT 91 (Tri-Mum).
(iii) Zenith Rubber & Plastice Works Vs. Vs. Commissioner of Customs (Export), Nhava Sheva 2009 (238) ELT 646 (Tri-Mum).
(iv) M/s Nichrome India Ltd. & Others Vs. Vs. Commissioner of Customs (Export), Nhava Sheva vide Order No. A/429-431/2009/SMB/C-IV dated 30.7.2009
(v) M/s Mehta Export Vs. Commissioner of Central Excise, Mumbai vide Order No. A/124-125/09/C-IV/SMB dated 6.4.2009.
He, further, submitted that CHA cannot escape from his liability as rightly held by this Tribunal in the above mentioned case laws and submitted that the appeal be rejected.
6. Heard.
7. I have gone through the submissions made by both sides. I find that it is an admitted fact that the goods have been loaded and exported without proper documents i.e. shipping line and LEO. The only question remains before me is that who is liable for such an act. As per the show-cause notice, the allegation is that the said goods were neither accompanied by a shipping bill nor by a boat-note but loaded on the said vessel without supervision of a proper officer. The person-in-charge of the vessel permitted loading of the goods, which were not accompanied by the shipping bill duly passed by the proper officer and even though no shipping bills were produced by the exporter.
8. The main thrust of the allegation is on the shipping line, which allowed the goods being loaded on the vessel without the proper documentation and without the supervision of the proper officer. It is true fact that when the goods are gated in, the goods are beyond the control of the CHA and the exporter. The reliance paced by the learned SDR in the cases of Sudarshan Cargo in appeals No. C/650, 809 & 1057/08 (cited supra at Sr. No. iv) and Zenith Rubber & Plastic Works (supra), the exporter was also held liable for such a breach. In this case, it was found that exporter completed all the necessary formalities in exportation of the goods and held that they have not faulted any provisions for loading of the goods without LEO. The CHA is mere an agent of the exporter, but the exporter has been exonerated, so the reliance placed by the SDR is of no help. The case of LMJ International (supra) and Mehta Exports (supra) have been stayed by the Honble High Court of Bombay, hence this is also of no help. Further, the reliance placed by the SDR in the case of Sudarshan Cargo (cited supra at sr. no. i), the facts are different in that case i.e. the CHA was in the knowledge that the documents were sent to the Range Superintendent for rectification and it was in the knowledge of the CHA that the same cannot be returned back before the date of the sailing of the vessel. In the instant case, the CHA has informed the shipping line that the shipping bill be handed over at JNPT office as early as possible and the shipping line failed to follow the Customs law, so far that CHA who was not having any control after the goods were gated in, the CHA alone cannot be held liable when the exporter has also been exonerated. Hence, I set aside the impugned order to the extent of imposition of penalty on the CHA. With these observations, the appeals filed by the CHA are allowed.
(Pronounced in Court on ) (Ashok Jindal) Member (Judicial) Sinha/ 1