Custom, Excise & Service Tax Tribunal
M/S. Skylark Travels Pvt. Ltd vs Commissioner Of Customs (General) ... on 24 March, 2015
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. Appeal No. C/90058/2014-Mum. (Arising out of Order-in-Original No. 101/2014/CAC/CC(I)/SRP-CBS (Admn) dated 30.09.2014 passed by the Commissioner of Customs (General) Mumbai ) For approval and signature: Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. P.S.Pruthi, Member (Technical) ============================================================
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 : No
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?
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M/s. Skylark Travels Pvt. Ltd.
:
Appellant
VS
Commissioner of Customs (General) Mumbai
:
Respondent
Appearance
Shri Subba Reddy, Advocate for Appellant
Shri S.J. Sahu, Assistant Commissioner (A.R) for respondent
CORAM:
Mr. M.V. Ravindran, Member (Judicial)
Mr. P.S.Pruthi, Member (Technical)
Date of hearing : 24/03/2015
Date of decision : /2015
ORDER NO.
Per : M.V. Ravindran
This appeal is directed against Order-in-Original No. 101/2014/CAC/CC(I)/SRP-CBS (Admn) dated 30.09.2014.
2. The relevant facts arise for consideration are the appellant is regular CHA License holder and was transacting business in Mumbai Custom House under the CHA Regulation. Certain investigations were carried out as to the illegal export of Red Sanders of about 6.900 MTS by misusing name and identity of one M/s. Sarva India Exports, without their permission and knowledge. The goods were exported under Shipping Bill No. 6132935 dated 18.3.2008 which were filed by the appellants firm. CHA was issued a show cause notice for the violation of CBLR 2013 (CHALR 2004 for the earlier period) and it was recommended for revocation of CHA License to the appellant. The adjudicating authority revoked the license forfeiting the entire amount of security deposit of the appellant. Aggrieved by such an order appellant preferred an appeal before Tribunal and the Bench vide final Order No. A/1080/14/CSTB/C-I dt. 20.06.2014 set aside the order and remanded the matter back to the adjudicating authority to give detailed finding about the inquiry proceedings. The impugned order before the Bench is passed in de novo proceedings by the adjudicating authority after following due process of law, revoked the license granted to the appellant forfeiting the entire amount of security deposit.
3. Learned Counsel appearing on behalf of the appellant would took us through the entire Order-in-Original and submit that the case of the Revenue is that the appellant was not supposed to sub-let that CHA License and has done so, he has not got any authorization from the exporter from filing the documents, that he has not met said exporter and ascertained as to whether the declared exporter was real exporter in the present case, there was no proper examination on the part of the CHA/CB regarding the factory stuffing of document. He would submit that all the finding of the adjudicating authority are erroneous but he fairly concedes that appellant had not obtained authorization from the exporter for filing the documents before the authorities. He would submit that the appellants license was suspended from 17.10.2008 and they are out of business from that date and a lenient view may be taken. He would submit that identical set of facts, this bench in the case of K.M. Ganatra & Co. Vs. Commissioner of Customs (G), Mumbai 2007 (219) ELT 316 (Tri.-Mumbai), S.P. Pawar & Sons Vs. Commissioner of Customs (General), Mumbai-I 2009 (247) E.L.T. 562 (Tri.-Mumbai) and Co-ordinate Bench in the case of Ashiana Cargo Services Vs. Commissioner of Customs ( I & G) 2014 (302) E.L.T. 161 (Del.) has taken a lenient view on the ground that the CHA License has been suspended/revoked for long period, hence that punishment is enough. He would submit that the appellant is not disputing that he was utilizing services of Dolphin Logistics as a sub-agent and the said Dolphin Logistics used to get business for them.
4. The Ld. AR on the other hand would submit that the statements recorded by the various persons were not retracted wherein it was admitted that CHA License was sub-let. He would drew our attention to the findings of the adjudicating authority wherein it is mentioned that Online Shipping Bills were applied by one Shri Flavin Walter Douza, who was not authorized to do so and the goods exported were smuggled Red Sanders which is a prohibited item. He would also submit that the revocation of the license is correct.
5. We have considered the submissions made at length by both sides and perusing the records. We find from the records that the CHA License of the appellant was suspended on 17.10.2008 and the same has been revoked by the impugned order. It is also not disputed that inquiry officer had been appointed and after following the due process of law, it is the finding of the inquiry officer that the appellant herein had violated the provisions of CHALR/CBLR and recommendation was to revoke the licence.
6. The first finding of the adjudicating authority is in respect of the use of premises of Dolphin Logistic and the equipments in software installed therein by the appellant for filing online Customs document and that one Shri Flavin Walter Douza, was using the said software for filing online Customs document in unauthorized manner. In this regard, we find that is undisputed as to Shri Flavin Walter Douza, who was considered as a sub-agent by Shri Sarosh Nagarwala is Managing Director M/s. Skylark Travels Pvt. Ltd. this comes from the statement of Shri Sarosh Nagarwala, which indicate that Shri Flavin Walter Douza, is sub-agent and was getting business, it is also on record that one of the pass holder Shri Prabhakar, employee of the appellant was always handling day to day work relating to the clearances and other activities required for the CHA work. It is noticed that in the examination-in-chief before the inquiry officer, Shri Flavian Walter DSouza has specifically indicated that Shri Prabhakar used to attend to day to day work relating to the CHA work from his office and Online ID User of Skylark Travels Pvt. Ltd was being operated from his premises in Dolphin Logistics by Shri Prabhakar only. We find that the appellant has not denied the charge that they failed to obtain authorization from the exporters in this instant case.
7. However, the adjudicating authority has held that the customer ID allowed to Shri Nagarvala was unauthorizedly used for Dolphin Logistics and hence there was a negligence on part of the appellant. It is to be noted that the inquiry which is conducted by the inquiry officer is based upon the charges and in the proceedings, examination in chief was conducted. In the examination for Chief, it is clearly brought out that one of the card holder of the appellant was attending to day to day work in the office of Shri Flavian Walter DSouza; this would mean that there was an implied permission from the appellant, to use their ID Number from the premises of Dolphin Logistics. It is also the finding of the adjudicating authority that the appellant had not met the exporter and failed to advise client to comply with the provisions of Customs Act, to which we find that the entire consignment which was exported by shipping Bill No. 6132935 dt.18.3.2008 was prepared based upon the documents that indicate that the container was factory stuffed and the Central Excise officers had signed all the documents as also the one time bottle seal was affixed to the container. We find that the appellant could have entertained a bona fide belief that the clearance work which has been undertaken by them, were coming from Shri Flavian Walter DSouza who was their sub-agent they need not ascertained authenticity of the transactions.
8. We find that the adjudicating authoritys finding as there was no proper examination on the part of the appellant regarding the reports of the factory stuffing documents to ascertain whether the signatures of Central Excise Authorities therein were forged or not correct areinconsistent with law, as the appellant herein being a CHA could have no means to ascertain whether the signatures of Central Excise Authorities were forged or not. Consequently, it would be impossible for the appellant to presume that the container which was sealed by the Central Excise Officers in factory stuffing contained smuggled Red Sanders. In fact, we note that none of the statements recorded either during the proceedings by the DRI, indicated that the appellant had knowledge of their being presence of Red Sanders in the container which was booked for export.
9. We find that Shri Sarosh Nagarvala, Director of the appellant is definitely in error in allowing his Online Customs user ID to Shri Flavian Walter DSouza. Though a point has been made that the said Customs Online user ID was used by one of his employee Shri Prabhakar. In our view there was lack of necessary control and supervision over possible misuse of CHA License by Shri Sarosh Nagarvala, Director of the appellant.
10. In our considered view, the CHA licenseof the appellant which was suspended on 17.3.2008 along with forfeiture of the entire of the security deposit and he being out of business for almost 6 = years, is substantial punishment meted out to appellant, and he has learnt his lesson.
11. Our above views are fortified by the ratio of the judgment of the Tribunal in the case of K.M. Ganatra & Co. (supra) wherein almost similar facts were there; the Tribunal after considering the submissions made held as under:
6.?We have considered the submissions. We find that it is an admitted fact that the appellant has allowed Shri Vipual Shah to carry on business on monthly rental basis or a consignment basis which has resulted in fraudulent exports by his client whose credentials were not looked in to by the CHA. This cannot be considered as a mere commission agent being employed by the CHA. In fact no authorization from the customer in favour of the CHA is on record and the copy produced by the appellant is without any date and there is no evidence that it was procured before taking up the business of the exporters in question. On the other hand the appellants contend that the same was recovered by the DRI but could not show any panchnama to that effect. We find that the tribunal has in the case of Noble Agency held that the statement of defence witness that employer for whom he was working did not have CHA licence and that he was using licence of the noticee CHA on payment of monthly sums is sufficient to prove subletting of licence. This decision has been concurred with in the case of Nanda International v. Commissioner of Customs, Chennai - 2004 (176) E.L.T. 524 (Tri.-Chennai), the only difference being that since in latter case the licence remained revoked for a period of six years and therefore a lenient view was taken and the licence was restored though forfeiture of security deposit was upheld. In the instant case, we find that the licence has been suspended for the last two years and has now been revoked permanently. We consider it too harsh a punishment as it deprive the CHA of his livelihood. We consider that revocation for a period of three years from the date of suspension of licence (i.e. 1-3-2004) would be sufficient and on expiry of three years licence may be restored on taking fresh security deposit as we confirm the order of the Commissioner in forfeiting the security deposited by the appellant earlier.
12. We also find that same views were expressed by the Bench in the case of S.P.Pawar & Sons (supra) wherein the following findings of the Bench:
6.?We have considered the submissions. We find that all the three articles of charges are based on two facts that the change in the partnership firm was not intimated to the Customs and that Shri Ramdas Dhormale, who was admitted as a unofficial working partner could not have acted as authorized signatory without intimation to the department and the fact that the goods were never transported to the manufacturing site at Surat but instead were diverted in the local market and false transport documents were maintained by the CHA to cover up the transport up to Surat. We find that the CHA has produced the delivery instructions from M/s. Tony Enterprises asking them to deliver the goods to their godown at Panvel. This by itself does not mean that the CHA was in the knowledge that after delivery of goods at the godown at Panvel, the goods will not be further transported to Surat and will, instead, be disposed off in the local market. Further when the show cause notice itself states, that the delivery of the goods was taken by the importer, who submitted manipulated transport documents to the CHA for his record, there is no evidence to show that the CHA was having the knowledge that these documents were manipulated and that the transporter did not exist and that the goods were not likely to be taken to Surat. The job of the CHA ended when the goods were cleared from the docks and the delivery thereafter was taken by the importer. He was not supposed to scrutinize the clearance documents submitted by the importer and to cause inquiries to know whether the transporter really exists or the goods were really transported or not. We also note that the CHA Regulations nowhere require the CHA to maintain records after delivery of the goods, more so, where transport after delivery is arranged by the importer himself. In view of this the findings of the Commissioner that the CHA has aided and abetted in the diversion of the goods and did not inform the Assistant Commissioner/Dy. Commissioner of customs regarding non-compliance, cannot be upheld and are accordingly set aside. The only charge, which con be established, is regarding the change in the constitution of the firm and allowing Shri Ramdas Dhormale to act as authorized signatory. Here also we find that the charges framed nowhere states that he acted as an authorized signatory, but these are observations made by the Commissioner, which are not based on enquiry report. Even if this breach is accepted, it cannot be considered so grave so as to call for revocation of the CHA licence. We find that Regulation 20 of the CHALR, 2004 [Regulation 21 wrongly mentioned by the Commissioner] gives option to the Commissioner to revoke the licence and order for forfeiture of part or whole of the security or only order forfeiture and part or whole of the security. In such a situation, we consider that forfeiture of whole of the security would meet the ends of justice. We accordingly set aside the order of the Commissioner revoking the licence of the CHA by holding that the whole of the security deposited by the CHA shall stand forfeited. Appeal is partly allowed.
13. In view of the factual position and the authoritative judicial pronouncement, we are of the view that the license of the appellant which has been suspended and revoked; appellant being out of work for more than 6 = years as a CHA, is enough punishment and a mitigating factor for taking a lenient view.
14. We, accordingly in the facts and circumstances of this case, direct the lower authorities to restore the License to the appellant on taking fresh security deposit, as we confirm the order of the Commissioner in forfeiting the security deposit. Our order of restoring the license shall be done at the earliest.
15. The appeal is disposed of as indicated hereinabove.
(Pronounced in court on /2015)
(P.S.Pruthi)
Member (Technical)
(M.V. Ravindran)
Member (Judicial)
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