Custom, Excise & Service Tax Tribunal
M/S. Him Logistics Pvt. Ltd vs Cc, New Delhi on 7 April, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI, PRINCIPAL BENCH NEW DELHI
Date of Hearing/Decision:7.4.2016
Customs Appeal No.50267/2016-CU(DB)
[Arising out of Order-in-Original No.132/SM/Policy/2015 dated 14.12.2015 passed by the Commissioner of Customs, New Delhi]
For Approval and Signature:
Honble Smt. Archana Wadhwa, Member (Judicial)
Honble Shri B. Ravichandran, Member (Technical)
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Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
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Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
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Whether Their Lordships wish to see the fair copy of the Order?
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Whether Order is to be circulated to the Departmental authorities?
M/s. Him Logistics Pvt. Ltd. Appellant
Vs.
CC, New Delhi Respondent
Appearance: Rep. by Shri Priyadarshi Manish & Ms. Anjali Jha Manish, Advocates for the appellant.
Rep. by Shri Rajeev Gupta, AR and Shri Sanjay Jain, DR for the respondent.
Coram : Honble Smt. Archana Wadhwa, Member (Judicial) Honble Shri B. Ravichandran, Member (Technical) Final Order No. 51291/2016 /Dated:7.4.2016 Per B. Ravichandran:
The present appeal is against the order dated 14.12.2015 of Commissioner of Customs (General), New Delhi for revoking the Customs House Agents licence of the appellant and also ordering the forfeiture of security deposit of Rs.75,000/- and imposing a penalty of Rs.50,000/- on the appellant.
2. The brief facts of the case are that the appellant, a licensed Customs Broker, was engaged in the customs clearance work at ICD, Tughlakabad. Certain investigations were conducted by the officers of DRI regarding a consignment of auto parts imported by M/s. Spreet International. The goods were examined on 5.5.2014 and were found to be auto parts as per the packing list and the goods appeared to be covered by the Third Schedule of Customs Tariff Act, 1985 to attract retail sale price based assessment. The goods were detained. The importer filed a bill of entry on 23.05.2014 through the appellant on first check basis. As no retail sale price was found on the packages, the good were seized and further investigations were conducted. On conclusion of investigation, a show cause notice dated 7.11.2014 was issued by the Dy. Director, DRI, Delhi in connection with the contraventions of the provisions of Customs Act, 1962. Subsequently, a show cause notice dated 14.02.2015 was issued to the appellant proposing revocation of licence along with forfeiture of security deposit and imposition of penalty on the appellant. Enquiry Officer submitted his report on 5.6.2015 holding that the appellant have not contravened the provisions of Regulation 11 (a), 11 (d), 11 (e) and 11 (n) of the Customs Brokers Licensing Regulations, 2013. However, the Commissioner vide his order dated 1.9.2015 revoked the Customs brokers licence and also ordered forfeiture of security deposit of Rs.75,000/- and imposed a penalty of Rs.50,000/- on the appellant.
3. The appellant approached the Honble Delhi High Court by way of writ petition. The Honble Delhi High Court vide their order dated 2.11.2015 quashed the order dated 1.9.2015 of the Commissioner. However, the said order was ordered to be treated as communication of reasons for dis-agreement entered by the Commissioner against the enquiry report and the appellant was given time to represent his case. Consequently, the appellant filed detailed submissions and thereafter, the present impugned order was passed by the Commissioner.
4. Ld. Counsel for the appellant submitted that the order of revocation of the licence was totally devoid of merit. The main grounds of appeal by the appellants are
(a) The appellants have fulfilled the obligations as prescribed under Regulation 11 and Circular No.9/2010-Cus dated 8.4.2010 regarding KYC norms for the clients;
(b) The bill of entry in the present case was filed after the goods were detained by the officers of DRI. The bill of entry was filed for verification of the contents before assessment, on first check basis. Hence, there can be no allegation of intentional violation of any provisions of Customs Act by the appellant;
(c) The inquiry report examined all aspects of the case and concluded correctly that the appellant have not violated the provisions of CBLR, 2013.
5. Ld. AR reiterated the findings as per the impugned order and submitted that the importer was not existing in the declared premises given in the IEC. The appellant have failed to verify the background of the importer and also failed to properly advice the importer regarding the requirement of RSP based assessment for auto parts covered by the impugned bill of entry.
6. We have heard both the sides and examined the appeal records.
7. We find that the main focus of allegation against the appellant which resulted in the revocation of licence is their failure to verify the presence of the importers in the given address. We have perused the provisions of Regulation 11 as well as the Boards Circular dated 8.4.2010. It is an admitted fact that the partnership firm involved in the import of the auto parts is an existing concern, duly registered having a deed for partnership and two existing partners. The IEC copy, PAN Card, telephone bill of the firm, Voter ID of the partners, copy of the partnership deed have been seen and verified by the appellant. The allegation that the IEC was obtained by submitting forged documents has no effect on the appellant as they could only verify the correctness of the documents submitted before taking up of the work for any importer. There is no stipulation or legal requirement to physically verify the business premises or residential premises of the importer and also to have a personal meeting with the importer before taking up the work for any importer.
8. We also note that in the present case the contravention alleged against the importer is non-declaration of retail sale price on auto parts imported by them for assessment under Section 4 A of the Central Excise Act, 1944 for CVD. We find that the bill of entry was filed by the appellant after the goods were detained by the officers of DRI. The said bill of entry was filed on first check basis for verification of the goods before assessment. In such a situation, we find that no malafide or intentional violation of any provisions of the Customs Act can be alleged on the part of the Customs broker. Regarding KYC norms and obligations under Regulation 11, we find that case as made out in the original order is neither convincing nor sustainable.
9. We find that the impugned order did not make out a sustainable case for revocation of licence. In the case of Setwin Shipping Agency Vs. CC (General), Mumbai - 2010 (250) ELT 141 (Tribunal-Mumbai), the Tribunal held that there is no requirement for the CHA to verify physically the premises of importer/exporter. The Tribunal also observed that it is a settled law that the punishment has to be commensurate and proportionate to the offence committed. In the present case, we notice that the punishment of revocation is not justifiable even if it is to be admitted that physical verification of the importers premises could have avoided the filing of the bill of entry by the appellant. Even in such a situation, the violation in respect of the cargo viz. the non-declaration of the RSP on the auto parts, a debatable point of interpretation, cannot be held against the appellant to result in the revocation of their licence. Here, it is to be noted that the bill of entry was filed after the detention of the goods for inquiry by the DRI Officers and request for physical verification of the cargo before assessment has been made in the form of first check bill of entry. We find that the impugned order passed on dis-agreement with the inquiry report has not brought out clear sustainable ground for such extreme action of revocation of licence. Violation of CBLR, 2013 has not been brought out as all the points have been elaborately discussed in the inquiry report and no sustainable ground for differing with the same could be made out.
10. Considering the above analysis and discussion, we find the present impugned order could not be sustained and accordingly, we set aside the same.
[Operative portion already pronounced in open court] ( Archana Wadhwa ) Member (Judicial) ( B. Ravichandran ) Member (Technical) Ckp.
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