Custom, Excise & Service Tax Tribunal
M/S. Kapoor & Co vs Commr. Of Customs (Airport & Admn.) on 4 February, 2015
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
EAST REGIONAL BENCH : KOLKATA
Customs Appeal No.70023/2013
(Arising out of the Order in Original No.KOL/CUS/AIRPORT/ADMN/31/2012 dated-21/12/2012 passed by the Commissioner of Customs (Airport & Administration), & Customs House, Kolkata)
For approval and signature of:
DR. D.M. MISRA, HONBLE JUDICIAL MEMBER
DR. I.P. LAL, HONBLE TECHNICAL MEMBER
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1. Whether Press Reporters may be allowed to see :
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 :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not ?
3. Whether Their Lordships wish to see the fair copy :
of the Order?
4. Whether Order is to be circulated to the Departmental :
Authorities ?
M/s. Kapoor & Co.
APPELLANT(S)
VERSUS
Commr. of Customs (Airport & Admn.),
Kolkata
RESPONDENT(S)
APPEARANCE
Sri Tanmoy Chakraborty, Advocate &
Sri Chhandak Dutta, Advocate
FOR APPELLANTS
Sri S. Sharma, Commr., A.R.
FOR THE RESPONDENTS
CORAM:
DR. D.M. MISRA, HONBLE JUDICIAL MEMBER
DR. I.P. LAL, HONBLE TECHNICAL MEMBER
DATE OF HEARING: 04/02/2015
Pronounced in the Court on: 18/3/15
ORDER NO.FO/A/75143/15
Per DR. I.P. LAL
By the impugned order, the Commissioner of Customs (Airport & Admn.), Kolkata has suspended the CHA license and ordered for initiating revocation proceedings against the appellant. Being aggrieved, the appellant filed stay petition against the order of suspension alongwith appeal to this forum. This Tribunal vide order dated 5/8/2014, rejected their stay petition as writ petition No. 599 of 2014 filed by the appellant in the matter of initiating the revocation proceedings pending before the Honble High Court, Kolkata.
2. The Ld. Advocate mentions that by order Dated- 31/10/2014 in G.A. No. 3226 of 2014 filed by fi M/s. Kapoor & Co., the Honble High Court of Calcutta has directed this Tribunal to hear and dispose of their appeal. Accordingly, the present appeal is taken up for its disposal.
3. Brief facts of the case are that an offence report dated- 30/10/12 was received by the Commr. of Customs (Airport and Admn.), Kolkata. From the report, it appeared that M/s. Electronic Enterprise, Delhi vide Bill of Entry No. 7022143 dated 05.06.2012 had imported Assorted Goggles (Stock Lot). They were found to indulge in mis-declaration and undervaluation of the goods. The Bill of Entry was filed by using the CHA License of the appellant. Shri Prasenjit Banerjee of M/s. The India First Logistics Co. in his statement dated 30/08/2012 admitted that he has processed the Bill of Entry in the present case using the CHA License of the appellant. Investigation conducted revealed that for letting out the license, the appellant used to get monetary benefit of Rs.300 to Rs.500/- per bill of entry and thereby earning Rs.75,000/- per month for about 150 bills of entry per month by letting his CHA name used by others.Shri Awadesh Kr. Srivastava , partner of the CHA firm admitted this fact in his statement dated 22/08/2012. Above contentions were further supported and incorporated in the statement dated 28/02/2013 of Shri Raktim Chakraborty, the statement dated 13/09/12 of Shri Tushar Pandit , statement dated 30/08/12 of Shri Nirmal Chakraborty, statement dated 31/08/2012 of Shri Patric Nath and statement dated 05/09/2012 of Shri Jai Prakash Gupta. It appeared from the above that the CHA license holder was only having clearance job in respect of export and that has been letting only his name to be mentioned on the Bills of Entry by others for clearance of the import consignments. The CHA firm M/s. Kapoor & Co. intentionally did not maintain the accounts and records of import clearances and follow the procedure for observing the know your customer (KYC) guidelines to verify antecedent, correctness of importer exporter Code (IEC) Number etc. and thereby violated the various provisions i.e. Regulation 12, 13 (a) & (b) (d) & (o), 13 (k) and 18 of the CHALR, 2004.Consequently, Commr. of Customs (Airport & Admn.) suspended License immediately on 15/11/2012 vide CHA order No. 14/2012 dated 15/11/2012 and confirmed the suspension order after giving post decisional hearing on 21/11/2012.He also ordered for initiating the proceedings for revokating the said license as prescribed under Regulation 22 of the CHALR, 2004.
4. Ld. Advocate for the appellant CHA has submitted that in the present case, the goods were seized on 4th July, 2012 for alleged under valuation and mis-declaration of imported goods. Ld. Commr., however, suspended the license on 15th November, 2012 and confirmed the same during the post decisional hearing. It is the submission that there is a lapse of about 100 days in suspending the license from the date of detection of the offence. He submitted that this Tribunal in its judgments (i) 2007 (219) ELT 522 (Tri.-Bang) in case of Tass Clearing Services Pvt. Ltd. Vs. Commr. of Customs, Hyderabad-II & (ii) 2009 (246) ELT 641 (Tri.-Chennai) in the case of Vector Freight Forwarders Vs. Commr. of Customs, Tuticorin set aside the suspension order as the same was not immediate suspension. He submits that according to para 7.2 of the Board Circular No. 9/2010 CUS dated 8th April, 2010, the investigating authority shall furnish its report within 30 days from the detection of the offence and within 15 days from its receipt, the license should be suspended. It is the contention that instructions of the Board are binding on the Department. Since they were not followed, the Suspension Order is bad in law. He submits that the allegations of transfer of license to unauthorized persons is not sustainable as such persons were holders of G&H card. He submits that copy of the offence report was not given before suspending the license and no cross examination allowed. Appellant has also being sufficiently punished. In these circumstances, it is prayed to set aside the suspension order.
5. As per contra, the Ld. A.R. submitted that although goods were seized on 4th July, 2012 but the investigation continued over a period of time comprising of the recording of the statements of the various persons to whom the appellant had let out his license. Last statement was recorded on 22/09/2012.The offence report was prepared on 30/10/2012 and forwarded by the investigating officers for appropriate actions to the licensing authority i.e. Commr. of Customs (Airport & Admn.). This report was received in his office on 6/11/2012. On the basis of the offence report, it appeared that the appellant has violated the various regulations of CHALR,2004 and therefore, the Ld. Commr. suspended the license on 15/11/2012. It is the contention that in the present case the order of suspension was passed within 15 days of the offence report as prescribed in the Boards Circular. In these circumstances, as there was no delay, the case laws cited by the appellant in case of Tass Clearing Service Pvt. Ltd. (Supra) and Vector Freight Forwarders (supra), are not relevant to the facts of the present case. He submits that the immediate action in regard to suspension came up for consideration before the Honble High Court of Calcutta in case of Orient Clearing & Forwarding Agency Vs. Union of India reported in 2000 (05) LCX 0058 wherein under para 22 of the said order, the Court observed that Regulation 21 (2) cannot be confined to the rigidity of the words Immediate Action alone. It has to be construed in the proper perspective because other relevant words are important for the purpose of coming to a proper conclusion .
6. Heard both the sides and perused the records.
7.1 We find that the Ld. Commissioner has suspended the CHA license under Regulation 20 (2) of CHALR, 2004. The Provisions of Regulation 20 read as under:
20. Suspension or revocation of licence:-
(1) The Commissioner of Customs may, subject to the provisions of regulation 22, revoke the licence of a Customs House Agent and order for forfeiture of part or whole of security, or only order forfeiture of part of whole of security, or only order forfeiture of part of whole of security, on any of the following grounds name-
(a) failure of the Customs House Agent to comply with any of the conditions of the bond executed by him under regulation 10;
(b) failure of the Customs House Agent to comply with any of the provisions of these regulations, within the jurisdiction of the said Commissioner of Customs or anywhere else;
(c) any misconduct on his part, whether within the jurisdiction of the said Commissioner of Customs or anywhere else which in the opinion of the Commissioner renders him unfit to transact any business in the Customs Station.
(2) Notwithstanding anything contained in sub-regulation (1) the Commissioner of Customs may in appropriate cases where immediate action is necessary, suspend the licence of a Customs House Agent where an enquiry against such Agent is pending or contemplated.
7.2 In the present case, imported goods involving mis-declaration and under valuation were seized on 4th July, 2012. Shri Ravi Madan, the proprietor of the importing firm in his statement dated 27/8/12, stated that their CHA is M/s. Kapoor & Co.; however, he transacted all the business and made the payments to Shri Prasenjit Banerjee of M/s. First Logistic Co. Shri Prasenjit Banerjee in his statement dated 30/8/12, stated that as per verbal agreement with the appellant CHA firm, he took the clearance job using the license of the appellant on payment of Rs.300/- to Rs.500/- per bill of entry. Similar averments were made by other persons whose statements were recorded by the officers. Shri Awadesh Kr. Srivastava, the authorized signatory of the CHA firm in his statement dated 22/8/2012 admitted about letting out his license for monetary consideration.
7.3 In view of above facts, it appeared that the violations of the various regulations necessitated and immediate action for suspension of the license under Regulation 20 (2) of the said Regulation.He, therefore, suspended the license on 15/11/2012 i.e. within 15 days of receipt of the offence report and confirmed the suspension vide order dated 21/12/2012 after giving post decisional hearing.
7.4 The Ld. Advocate has submitted that in this case the license was suspended after a gap of about 100 days from the date of seizure and the recording of the statement dated-30/08/2012 of Shri Prasenjit which has revealed the involvement of the appellant in the impugned violations of CHALR, 2004. He has quoted the Boards Circular wherein under para 7.2 it has been clarified that in cases where immediate suspension action against a CHA is required to be taken by the Commissioner of Customs under Regulation 20 (2), there is no need for following the procedures prescribed under Regulation 22. However, in such cases a Post decisional hearing should be given to the aggrieved party. Further, certain time limits in such cases has also been prescribed according to which, the investigating authority shall furnish its report to the Commissioner of Customs who had issued the CHA license, within 30 days of the detection of an offence. The licensing authority shall take necessary immediate suspension action within 15 days of receipt of the report of the investigating authority. In this regard,we find that while the circular lays down a time limit of 15 days for necessary immediate suspension action, it however, does not provide any time limit by which the investigating authority should arrive on the conclusion that an offence has been committed. Moreover, for arriving on such conclusion, it is necessary to examine various evidences and the progress of on going investigation. The Ld. A.R. however, submitted that in the present case, last statement was statement dated 5/9/12 of Shri Joy Prakash Gupta and thereafter an offence report dated 30/10/2012 was prepared by the investigating authority. We are of the view that the time taken by the Investigating Authority in preparation of the offence report is therefore, justified. On receipt of the offence report, the suspension order was issued within 15 days and therefore, we are not convinced with the contention of the Ld. Advocate that the suspension order not being immediate action is void.
7.5 As regards the case laws cited by the Ld. Advocate, we find that in case of Tass Clearing Services Pvt. Ltd. (Supra), offence was detected on 22/09/2006 and the CHA license was suspended on 22/11/2006. In case of M/s. Vector Trade Forwarders (supra) red sanders was seized on 12/08/2008 and thereafter only one statement was recorded on 22.09/2008 and the license was suspended on 18/11/2008. Under these circumstances, Tribunal held that the action taken for suspending the license did not qualify for immediate suspension. Moreover, the charges in both the cases were not found serious enough to continue the suspension order. In the present case,it is noticed that a series of statements were recorded during the course of investigation from which investigating authority arrived on the conclusion that the appellant has violated the various regulations of CHALR. Accordingly, the facts of the present case are distinguishable..
7.6 We find that the expression, Immediate Action was considered by the Honble Calcutta High Court in case of Orient Clearing and Forwarding Agency (supra), wherein the Honble High Court has observed as under:
22.Regulation 21 (2) cannot be confined to the rigidity of the words immediate action alone. It has to be considered in the proper perspective because other relevant words are important for the purpose of coming to an appropriate conclusion in this respect which are as follows:
I. Notwithstanding;
II. In appropriate cases, III. Where an enquiry against such agent is pending or contemplated, Therefore, the word immediate action cannot have any independent leg to stand unless it is fit in the circumstances in respect of all or either of the conditions as above.
8. On analysis of the facts stated above, we find that the Commissioner has given detailed reasons which indicate that this is an appropriate case for suspension of the CHA license. We also find that in the instance case, admittedly, enquiry is pending or contemplated. Accordingly, we hold that the Ld. Commissioner has rightly suspended the license and the order passed by him does not suffer with infirmity on account of the same not being an immediate suspension order.
9. The Appellant claimed that they had not been allowed to cross-examine the witnesses. However, they could not substantiate their claim before this forum that such plea has been raised before the commissioner and not considered by him. Therefore it is not prudent to consider such plea at this stage. Besides, we are also of the view that it cannot be claimed as a matter of right and would depend on the facts of each case. In the present case, various persons in their statements recorded under Section 108 of the Customs Act, 1962 admitted that they had used the license of the appellant for monetary consideration. Besides Shri Awadesh Kr. Srivastava, the authorized signatory of the appellant firm has also admitted the said facts. He also stated that he did not know his importing firm and also not maintained record of such clearances.We are of the view that confessional statement given voluntarily under Section 108 of the Customs Act, 1962 are admissible evidence.
10. In view of the facts and circumstances of the case as state above, we do not find any merit in the appeal and the same is rejected. It is made clear that we have not passed any order regarding the ongoing enquiry and the revocation proceedings, which are altogether separate proceedings.
(Pronounced in the Court on )
(DR. D.M. MISRA) (DR.I.P.LAL)
JUDICIAL MEMBER TECHNICAL MEMBER
k.b/-
Customs Appeal No.70023/2013
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