Custom, Excise & Service Tax Tribunal
Trans Global Logistics vs Commissioner Of ... on 23 August, 2013
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No. C/40412/2013
[Arising out of Order-in-Original No.19574/2012 dt. 12.10.2012 passed by the Commissioner of Customs(Seaport-Import), Chennai]
For approval and signature:
Honble Shri MATHEW JOHN, Technical Member
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 the Member wishes to see the fair copy of
the Order? :
4. Whether Order is to be circulated to the Departmental
Authorities? :
Trans Global Logistics
Appellant
Versus
Commissioner of Customs(Seaport-Import),
Chennai
Respondent
Appearance:
Shri Mohd. Ismail, Advocate For the Appellant Shri P. Arul, Superintendent (AR) For the Respondent CORAM:
Honble Shri Mathew John, Technical Member Date of hearing : 23.8.2013 Date of decision : 23.8.2013 FINAL ORDER No.40322/2013
1. The appellant is a Custom House Agent. One of their employees, who was issued a photo ID Card in Form H as per Regulation 19 (6) of Custom House Agents Licensing Regulations, 2004, was found to be not possessing the minimum educational qualification as prescribed under Regulation 19. In fact, from the investigation done, it was seen that the concerned employee by name Shri Deepak Kumar Sharma was having a certificate of having completed 12th class from the Board of Secondary Sanskrit Education, Lucknow. On enquiries made by the Custom House officers, it was found that the Board was not recognized by University Grants Commission. Therefore, a case was made out against the appellant of not having exercised due care while employing the said Mr.Deepak Kumar Sharma and, on adjudication, a penalty of Rs.50,000/- has been imposed on him under Section 158 (2) of the Customs Act, 1962. Aggrieved by the order, the appellant has filed this appeal. The appellant submits that they were not aware that this particular Board was not recognized by UGC. As soon as the matter was pointed out, his service was terminated. He draws attention to Regulation 19 (1) and Regulation (2) which reads as under :-
(1) A Custom House Agent may, having regard to the volume of business transacted by him, employ any number of persons to assist him. The minimum educational qualification of such persons shall be 10+2, or equivalent.
(2) Appointment of a person referred to in sub-regulation (1) shall be made only after obtaining the approval of the Deputy Commissioner of Customs or Assistant Commissioner of Customs designed by the Commissioner of Customs for this purpose and in the matter of granting approval, he shall take into consideration the antecedents and any other information pertaining to the character of such person.
2. He submits that appointment of employees of CHA has to be approved by the Deputy Commissioner or Asst. Commissioner of Customs designated by the Commissioner of Customs. In the case of Mr.Deepak Kumar Sharma also, such approval was obtained. The Customs officers also were not aware that the Board in question was not recognized by UGC. This shows that there was no mens rea on the part of the appellant while employing the person. Further, he draws my attention to the finding in Order-in-Original at para-5 wherein it is recorded that there is no allegation that CHA or his employee viz. Sri Deepak Sharma have been involved in any activity which has caused revenue leakage. In the circumstances, he submits that penalty imposed is not warranted and the same should be set aside.
3. Opposing the prayer, Ld. AR for Revenue submits that it is the bounden duty of the CHA to ensure that all the clauses of regulations are complied with. He should have verified that the persons employed by him are possessing the requisite qualification as recognized by the UGC. Since appellant has not complied with this requirement, penalty is to be imposed irrespective of the fact whether they were aware that the Board was recognized or not. He submits that under section 158 (2), there is no requirement of any mens rea and penalty should be imposed once violation of regulation is established.
4. Considered arguments on both sides. I find that, in this case, the appellant as well as approving Asst. Commissioner or Deputy Commissioner of Customs have missed to ascertain whether the Board in question was recognized by UGC. Thus, once there is negligence on the part of department also, it is not fair to impose any penalty on the appellant. No other facts leading to revenue leakage or any loss to the State has been pointed out. Therefore, in the overall facts and circumstances of the case, I feel that penalty imposed is not warranted. So I set aside the impugned order and allow the appeal.
(Dictated and pronounced in open court) (MATHEW JOHN) TECHNICAL MEMBER gs 2