Custom, Excise & Service Tax Tribunal
Emirates Shipping Agencies India Pvt ... vs Ahmedabad on 12 April, 2022
Customs, Excise & Service Tax Appellate Tribunal
West Zonal Bench At Ahmedabad
REGIONAL BENCH- COURT NO.3
Customs Appeal No.12642 of 2018-SM
(Arising out of OIA-AHD-CUSTM-000-APP-38-18-19 dated 10/05/2018 passed by
Commissioner of CUSTOMS-AHMEDABAD)
Emirates Shipping Agencies India Pvt Ltd ........Appellant
509, 5th Floor, Sakar-Iv, Behind Natraj Cinema,
Near Mithakhali Railway Crossing,
Off Ashram Road, AHMEDABAD, GUJARAT
VERSUS
C.C.-Ahmedabad .......Respondent
Custom House, Near All India Radio Navrangpura, Ahmedabad, Gujarat APPEARANCE:
Shri Dhaval Shah, Advocate for the Appellant Shri G. Kirupanandan, Superintendent (AR) for the Respondent CORAM: HON'BLE MEMBER (JUDICIAL), MR. RAMESH NAIR Final Order No. A/ 10340 /2022 DATE OF HEARING: 06.01.2022 DATE OF DECISION: 12.04.2022 RAMESH NAIR The present appeal is directed against the impugned order dated 10-05- 2018 passed by the Commissioner of Customs (Appeals) whereby the Commissioner (Appeals) has rejected the appeal of the appellant and upheld the Order-in-Original confirming the penalty of Rs. 1 Lakh under Section 112
(a) of Customs Act, Penalty of Rs. 1 lakh/- Under Section 114AA and again of Rs. 50,000/- Under Section 116 of the Act. on the appellant who acted as agent of shipping line on behalf of the importer.
2. The brief fact of the case is that M/s Fairdeal Supplies Ltd., Ahmedabad filed a Bill of Entry bearing No. 4078848 dtd. 29.01.2006 at ICD Khodiyar for clearances of "Aluminium Ingots" through M/s Exim Management Service (CHA), whereas the Appellant was the container line. The Bill of Lading was drawn in the name of M/s Bajrang Refractories Pvt. Ltd., who vide High Sea
2|Page C/12642/2018-SM Sale Agreement sold the entire Aluminium Ingots to M/s Fairdeal Supplies Ltd. Attested copy of Bill of Lading, Invoice and other documents submitted at the time of High Seas sales agreement shows the commodity as "Aluminium Ingots" classified under chapter heading 76012010. Accordingly, Customs House Agent filed above mentioned bill of entry for the assessment of the subject goods. As per the various documents submitted along with bill of entry, the goods were classified under chapter heading 76012010, accordingly the subject Bills of Entry was assessed on 04.02.2016 by the Assessing Officer and the goods were marked for examination. During the course of examination, it was noticed that the Container No. CARU 3728580 was holding the seal (found intact) bearing No. F87809, which was different i.e D607549 from that declared in the Bill of Lading submitted by the CHA at the time of assessment, which appeared to have been issued by appellant. The examination of the goods was carried out in presence of the representative of Customs, CONCOR, CHA, Shipping Line Surveyor, CONCOR Surveyor, Security and Importer. On opening the container, Cement Blocks were found instead of declared goods i.e Aluminium Ingots and the entire container was full of cement blocks only. After completing the investigation a Show Cause Notice dtd. 04.06.2006 was issued to M/s Fairdeal Supplies Ltd. (Importer) for confiscation of "Cement Block" and for recovery of duty on it and penal action under Section 112(a), 114AA and 116 of the Customs Act, 1962. The Show Cause Notice was issued to appellant for penal action under Section 112(a), 114AA and 116 of the Customs Act, 1962 and to CHA for penal action under Section 112(a) of the Customs Act. The Adjudicating Authority adjudicated the case vide OIO dtd. 05.05.2017 and imposed the penalty on the Appellant. Aggrieved by the said order, appellant filed appeal before the Commissioner (Appeals), and learned Commissioner (A) upheld the Order-in-Original and rejected the appeal filed by the appellant. Hence, the present appeal.
3. Shri. Dhaval Shah, Learned Counsel appearing on behalf of the Appellant submits that in the instant case, the Appellant acted as the agent of the shipping line, the responsibility of the line is restricted to transporting the cargo and the line, in this case, had nothing to do with stuffing the cargo or filing cargo declarations. The penal provisions of the Customs Act, 1962 not applicable on Appellant. The Appellant was not concerned with the "import of goods" or concerned with bringing goods into India, contrary to any prohibition in force. The Appellant is only a line which has simply transported the goods and as such the Appellant was never involved in the process of importation of the goods. Further, the goods were not prohibited goods. In view of the
3|Page C/12642/2018-SM foregoing, no penalty can be levied for violation of Section 111(d) of the Customs Act, 1962 upon the Appellant.
4. He also submits that Appellant was neither concerned with declaration of the goods nor concerned with the declaration of the value of the goods. Being a shipping line concerned only with transportation of goods, the Appellant had nothing to do with Section 111(m) of the Act. Consequently there is no question of the Appellant violating Section 111(m) of the Act and so the provision of Section 112(a) of the Act are not attracted in the instant case.
5. He further submits that adjudicating authority erred in not considering the facts that the Appellant issued a "No Objection Letter" only to confirm that the container arrived with seals intact and declaring that it had "no-objection"
if any seal No. D87809 affixed to the Container is cut. The Appellant at that time, also believed that the seal mismatched was inadvertent (since the seal number was declared by the shipper). Pertinently, it was necessary for the Appellant to mention the actual seal number in the "No Objection Letter" since it is the practice to have a confirmation from the shipping line/ agent about the number of seal which is sought to be cut at the ICD. This can never be a "contradictory" stand taken by the Appellant.
6. He also argued that the adjudicating authority erred in his conclusion relating to issuance of the delivery order ("DO") to the Importer. The DO stated that the seal number of the Container is D607549 and cargo as 'CEMENT BLCOK". This was in accordance with information available with the Appellant (as declared by the Shipper and as mentioned in the Original BL). It was only subsequently that the appellant noticed there was a seal number mismatch, in as much the seal affixed to the container was numbered F87809. This has always been the Appellant's position and there is nothing 'contradictory" about the stand taken by it in relation to the issue of seal mismatch. The DO described the cargo as "Cement Blocks". Apart from this, the seal number mentioned on the DO corresponds with what was mentioned on the original BL. Thus There is no question of the Appellant contradicting its own DO and this finding was belied by the record.
4|Page C/12642/2018-SM
7. He submits that Appellant always maintained that it carried "cement blocks" as stated by it in the Original BL, IGM and DO. Even when the Container was opened, it was found to contain cement blocks. Thus, the Appellant acted responsibly in carrying the container and the cement blocks safely from China to India. All declaration filed by the Appellant i.e. the cargo was 'cement blocks' were correct. As set out in the recital of facts, the DO issued to importer for cement blocks was inadvertently issued against the forged BL which described the goods as aluminium Ingots. The Appellant has explained how and why DO was issued and how the forgery was not noticed at that time. Thus, inadvertent in issuance of a DO against a forged BL above does not support the finding in the Impugned Order that the Appellant did not carry the container responsibly.
8. He also argued that the penalty proceedings are quasi-criminal proceedings and penalty cannot be imposed in the absence of a finding of men-rea. The Adjudicating authority observed that as the Appellant caused the importer i.e Fairdeal to file a Bill of Entry for "aluminium ingots" in as much as the line issued two bills of lading, one showing the goods imported as "aluminium ingots'. Accordingly the adjudicating authority contendednthis mis-declaration by the importer was attributable to the Appellant issuing two bills of lading. However there is nothing on record which suggest that the Appellant issued two bills of landing and no reason has been provided in the impugned order as to why this finding was arrived at.
9. He also submits that imposition of penalty under Section 116 of the Act is erroneous. Adjudicating authority failed to apreciate that the Appellant as an agent of line, was involved only in filing IGM and issuance of DO. In the IGM the Appellant declared the goods to be "CEMENT BLOCKS", basis information provided by the Shipper and the Original BL. The Appellant did not file the Bill of Entry. Therefore, the Appellant did not declare the cargo imported to be "aluminium ingots".
10. He further submits that Ld. Adjudicating authority did not consider the Judgment of CESTAT Chennai in the matter of MSC Agency (India) Pvt. Ltd. Vs. Commissioner of Customs, Chennai - Appeal No. C/S/40318/2013 & C/40383/2013. He also placed reliance on the following decision in support of above submissions:
(i) Seahores Shipping & Ship-Management Pvt. Ltd. Vs Union of India - 2004 (163) ELT 145 (Bom)
5|Page C/12642/2018-SM
(ii) Fast Cargo Movers Vs. CC, Jodhpur - 2018 (362) ELT 184 (Tri. Del)
11 On the other hand, Shri. G. Kirupanandan, Learned Authorized Representative appearing for the Revenue reiterates the findings of the impugned order and placed reliance on the following Judgments:
(i) Caravel Logistics Pvt. Ltd. Vs . Joint Secretary (RA), Ministry of Finance, Department of Revenue - 2016(338)ELT 266(Mad.)
(ii) Caravel Logistics Pvt. Ltd. Vs. Joint Secretary (RA) - 2013 (293) ELT 342 (Mad.)
(iii) Sanco Trans Ltd Vs. CESTAT, Chennai - 2017 (350) ELT 521 (Mad.)
12. We have considered the submissions made by both the sides and perused the records and the facts and circumstances of the case. We find that in the impugned matter involvement of the Appellant in detail explained by the original adjudicating authority in his order in para 30.1 as under:
"I have perused both the bills of lading, one submitted by the importer and another submitted by the shipping line. I find that both the bills of lading dated 31.12.2015 are shown to have been issued by Emirates Shipping Lines DMCEST at China and both bear the same No. EPIRCHNXNG134780, both mention container No. CARU 3728580 and Seal No. D607549. I further find that in the bill of lading submitted by the importer the description of goods is shown as 'Aluminium Ingots' whereas, in the bill of lading submitted by the shipping line the description of goods is shown as 'cement block'. I find that the delivery order dtd. 2nd February, 2016 issued by M/s Emirates Shipping Agencies (India) Pvt. Ltd. contained the details, which were identical to the details contained in the bill of lading, i.e. port of origin, port of load, port of discharge, port of final destination, container number, date and number of the bill of lading i.e EPIRCHNXNG134780 dtd. 31st December, 2015, quantity and weight of goods. I also find that in the said Delivery order the description of goods is not given in the column 'No & Kind of Packages' it is mentioned as '20 PALLETS (OTHER NOT DEFINED)' and the seal number is mentioned as D607549 which is the same as mentioned in the Bill of lading No. EPIRCHNXNG134780. I find that it was only when the difference in seal numbers was noticed by the importer and then found during the course of physical examination by the customs authorities that M/s Emirates Shipping Agencies (India) Pvt. Ltd. issued a certificate that the correct seal number was F87809 and not D607549. They, after the goods were found to be 'Cement Blocks' during the course of physical examination produced a bill of lading showing the import goods as 'Cement Blocks'. I find from the sequence of event that this is an afterthought by M/s Emirates Shipping Agencies (India) Pvt. Ltd., they had contradicted not only with M/s Fairdeal but also whit their Chines counterpart i.e Emirates Shipping line DMCEST. The contention of the shipping line that the seal
6|Page C/12642/2018-SM was intact is not tenable as not only there was mismatch in the container seal number it is also on record that the seal put by the inspection agency in China i.e CCICTJ112286 was also missing. I observe that safe carriage and transportation of goods from the consigner to consignee is the basic responsibility of the shipping line and it is only on the basis of delivery order issued by the shipping line that the consignee can take delivery of goods at the port of destination. There is no. There is no evidence before me to decide as to which documents are original and which are manufactured or forged and therefore, I am constrained to place my finding on record in this regard. However, from the contradiction as discussed above I find that the shipping line has not acted in a responsible manner, either they were not aware of the missing seal put by the inspection agency or they conveniently ignored to inform the consignee or the consignor. I have discussed above that the shipping line had also contradicted their own Delivery Order."
12.1. Clearly, in the present matter Appellant has not acted in a responsible manner, thus any act or omission to do any act, which renders the goods liable to confiscation attracts penalty. In this background the charges under Section 112(a), 114AA of the Customs Act as well as Section 116 of the Customs Act are upheld.
12.2. We also find that the decisions relied upon by the Learned Counsel for the appellant are cases in which container was brought with sealed intact. Whereas in the present matter it is on record that there was mismatch in the container seal number and seal put by Inspection Agency in China was also missing, therefore, distinguishable.
13. In these circumstances, I uphold the impugned order under challenge. As a result, the appeal is dismissed.
(Pronounced in the open court on 12.04.2022 ) (RAMESH NAIR) MEMBER (JUDICIAL) Prachi