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[Cites 3, Cited by 15]

Delhi High Court

Kunal Travels (Cargo) vs Commissioner Of Customs (Import & ... on 27 March, 2017

Author: Najmi Waziri

Bench: S. Ravindra Bhat, Najmi Waziri

$~
*      IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                         Judgement delivered on: 27.03.2017

+                           CUSAA 1/2016

KUNAL TRAVELS (CARGO)                                              ..... Appellant

                            Versus

COMMISSIONER OF CUSTOMS (IMPORT & GENERAL)
NEW CUSTOMS HOUSE, IGI AIRPORT, NEW DELHI ..... Respondent

       AND

+                           CUSAA 12/2016

KUNAL TRAVELS (CARGO)                                               ..... Appellant

                            Versus

COMMISSIONER OF CUSTOMS
(IMPORT & GENERAL)                                                  ..... Respondent

Advocates who appeared in this case:
For the Appellant:   Mr. Amarjeet Singh, Advocate.
For the Respondents: Mr. Sanjeev Narula, Sr. Standing Counsel with Mr. Abhishek Ghai,
                     Advocate.

CORAM:
HON'BLE MR. JUSTICE S. RAVINDRA BHAT
HON'BLE MR. JUSTICE NAJMI WAZIRI

NAJMI WAZIRI, J.:-

1.     These appeals are directed against the impugned order dated
08.06.2015 of the CESTAT, which upheld the order-in-original dated
01.05.2007 passed by the respondent - Commissioner of Customs revoking
the appellant‟s Customs House Agent (CHA) license and forfeiting its
security deposit of Rs.1 lakh.
CUSAA 1-2016 & 12-2016                                                   Page 1 of 15
 2.     The said license was granted under the Customs House Agents
Licensing Regulations, (CHALR), 2004.        The appellant had filed two
shipping bills on 17.06.2003 in the name of one M/s H.M. Impex regarding
the export of readymade garments entailing a duty drawback claim of about
Rs.34 lacs. Upon inspection of the goods by the customs authorities it was
found that against the declared weight of 10200 kg, the consignment
weighed only 3820 kgs. in respect of one of the bills besides the
goods/garments were of low quality and of irregular size.        Hence the
customs authorities concluded that there was a deliberate mis-declaration
apropos the quality, quantity, value and weight of the consignments with the
intention to defraud the government and illegitimately claim the benefit of
duty-drawback.

3.     The investigation apropos the exporter M/s H.M. Impex, at its given
address WZ-156, Madipur, New Delhi - 63, of which one Mr. Rajiv Kumar
was claimed to be its proprietor, but its Import Export Code (IE Code),
revealed that no such entity existed at the said address. An employee of the
appellant, Mr. Lalit Katoch, was said to be involved in the filing of the
export documentation and inspection of the consignments. The appellant‟s
proprietor, Mr. Sunil Bhatia had contended that the exporter was introduced
to the CHA by Mr. Lalit Katoch who was the appellant‟s sales executive,
and the latter in turn had been approached by one Mr. Vijay Gupta; the
proprietor claimed ignorance of the nature or quantum of the goods in terms
of the documents filed by Mr. Lalit Katoch, therefore, no allegation of mis-
declaration or fraud could be fastened upon him or upon the appellant.
Furthermore, he contended that the revocation of license for the submission
of documents by his employee was too harsh an action and it ought to be
recalled.   He relied upon the judgment of the CESTAT in M/s Pranil
Shipping Vs . CC, Jamnagar by Final Order No. A/11432 dated 24.7.2014.

CUSAA 1-2016 & 12-2016                                           Page 2 of 15
 4.     The respondent, however, argued that the shipping bills were filed
without verifying the identity of the exporter or ascertaining the veracity of
the declarations made in the shipping bills for clearance of the goods through
customs for export; this was a necessary precaution that the CHA ought to
have taken before the documents were filed; this default shows a lack of due
diligence and of serious misconduct, hence the respondent‟s action was
justified. Especially, in view of the judgement of the Bombay High Court in
CC (General) Vs Worldwide Cargo Movers, 2010 (253) ELT 190 (Bom.)
and the Andhra Pradesh High Court in CC Hyderabad-Il Vs H.B. Cargo
Services, 2011 (268) ELT 448 (A.P.).

5.     In the impugned order the CESTAT had concluded that the shipping
bills were filed in the name of a non-existent entity/exporter viz. M/s H.M.
Impex, and there was nothing on record to show that anyone on behalf of the
said exporter had ever approached the appellant for filing of the said
shipping bills; the consignment was of a large value; the hand-written
invoices were typed in the appellant‟s office; Mr. Lalit Katoch kept the
proprietor involved/informed and the latter gave his consent for filing the
documents; the high value of the consignments required due diligence
compliance of Know Your Customer (KYC) norms under the CHALR,
2004 so as to ascertain the genuineness of the exporter and the exports.
Since there was a gross mis-declaration in the description, value and weight
of the consignment, there was non-compliance of the CHAs obligations
mandated in Regulation 13 of CHALR, 2004. The CESTAT further opined
that the CHA is treated with a certain degree of trust by the customs
authorities, this trust has been completely violated in the present case; such
breach of trust qualifies as grave misconduct on the part of the CHA i.e i)
filing shipping bills of such high value in the name of a non-existing firm, ii)
a serious dereliction of duty in not verifying the genuineness of the exporter

CUSAA 1-2016 & 12-2016                                              Page 3 of 15
 or of the consignment and iii) such conduct would have high financial and
security consequences. The appellant‟s reliance on M/s Pranil Shipping
(supra) was found to be inapplicable to the facts of the case, instead the
CESTAT found favour with the judgments cited by the respondent i.e.
Worldwide Cargo Movers (supra) and H.B. Cargo Services (supra).              The
latter judgment held that "a single act of corruption is sufficient to award the
maximum penalty which under the CHALR is of revocation of the license",
whereas the former held that the punishment for misconduct is best left to
the disciplinary authority save in exceptional cases where it is shockingly
disproportionate or malafide.

6.     Worldwide Cargo Movers (supra) had in turn relied upon a judgment
of Madras High Court in Arvind C. Bhagat Vs. CC, Chennai, 2000 (122)
ELT 678 (Mad), in which the CHA had failed to discharge its obligation to
exercise proper supervision, as in the case of Shri Kamakshi Agency Vs.
Commissioner of Customs, Madras 2001 (129) ELT 29 (Mad), also
referred to in the same judgment.       The CHA was held responsible for
fraudulent activity of the third parties to whom it had delegated its functions.
However, it is to be noted that in Shri Kamakshi Agency (supra) the CHA
had "brazenly defended his Regulation 8 employee who gave a fake name of
his brother as an importer for undervaluing the imported car...".

7.     In the present case, however, the appellant has not defended the action
of Mr Lalit Katoch, on the contrary it is the appellant‟s case that Mr. Lalit
Katoch was merely a marketing executive and not a „G‟ or „H‟ Card Holder
under the CHALR, 2004, therefore, the latter and Mr Dheeraj Khurana had
no business entering the customs house or having the goods examined and
their presence at the ICD, Tughlakabad was unauthorized. Nor were they
authorized to sign any documents on behalf of the CHA. Furthermore, Mr
Roshan Sharma - the appellants G card holder had denied having signed any
CUSAA 1-2016 & 12-2016                                              Page 4 of 15
 documents of M/s HM Impex. The appellant had denied the allegations in
the show cause notice dated 16.06.2004. It had contended that since the
actions of Mr. Lalit Katoch were without any authority the appellant ought
not to be penalized for it.

8.     The appellant‟s license was suspended w.e.f. 20.09.2004.         In the
challenge before the CESTAT, this suspension was set aside on 12.10.2004
and the Commissioner of Customs was directed to re-appreciate the
appellant‟s case since the Commissioner had not satisfied himself about the
urgency which was required in a case of immediate suspension under
Regulation 20(2) of the CHALR. The Commissioner was further directed to
state the grounds on which he proposes to suspend the license and to provide
an opportunity to the CHA to submit its response within a specified time.
However, in the subsequent de novo proceedings on 28.02.2005 an order-in-
original was passed reiterating the suspension of the appellant‟s license by
reproducing the facts in the show cause notice dated 16.06.2004. Challenge
to this suspension order before the CESTAT was unsuccessful on the ground
that the Commissioner was within his powers to pass such suspension order
apropos the facts at that stage of the case.

9.     Aggrieved by the above the petitioner approached this court through a
writ petition: WP(C) No. 11628-29/2005 which was disposed-off                 on
23.08.2005 with the direction that the order of the Commissioner shall be
treated as a show cause notice and upon the appellant responding to it within
two weeks therefrom, a reasoned order would be passed. On 06.10.2005 an
inquiry report was prepared by the Assistant Commissioner of Customs
under Regulation 22 of CHALR, 2004. It concluded that i) the appellant had
not contravened Regulation 13(n) as there was nothing to prove that it
caused unavoidable delay or did not attend to its duties with utmost speed ii)
since the exporter was a non-existent entity and the documents were
CUSAA 1-2016 & 12-2016                                             Page 5 of 15
 prepared in the office of the CHA and were filed by its employees, and the
goods were incorrectly declared with an inflated value so as to fraudulently
obtain the duty drawback, there was a lack of due diligence by the CHA in
terms of the said regulations. The appellant‟s submissions against the report
and the procedure did not find favour with the Commissioner of Customs,
who vide order dated 01.05.2007 imposed a penalty of             `1 lakh under
Section 114 of the Customs Act, 1962 on the appellant and revoked its CHA
license.   This was an appeal against the said revocation, penalty and
forfeiture before the CESTAT, which resulted in the impugned order.

10.    The appellant contends that the impugned order erred in concluding
that M/s H.M. Impex had never approached it for filing the shipping bills or
that no authorization had been obtained from it since this is contrary to the
facts available on record; that it had filed the due authorization in this regard
and had declared so in the shipping bills; indeed this was prominently
mentioned on top of the shipping bills; that there was no delay in the
discharge of duty towards the CHA; it had properly maintained its books and
had not refused access to any material which was sought by the respondent;
it had submitted copies of its attendance register as and when required by the
customs authorities; it had not sought to influence any government officials
apropos the shipping bills; it had paid the requisite government dues; it had
exercised due diligence apropos the correctness of the information as
provided by its clients regarding the clearance of the cargo - consignment.
In the present case it had not represented M/s H.M. Impex before the custom
authorities in any manner since the entire action had been taken by an
employee i.e. Mr. Lalit Katoch without the CHAs authorization; and finally
that the show cause notice does not specify as to which clause of Regulation
13(e) of the CHALR, 2004 had been violated by it. The appellant submitted
that Mr. Lalit Katoch was never authorized by it to act apropos clearance of

CUSAA 1-2016 & 12-2016                                               Page 6 of 15
 export consignment and his duties were limited to that of a sales and
marketing executive; hence for the action of its employee was beyond the
scope of his duties the appellant and its proprietor cannot be punished.

11.    The obligations of the CHA are stipulated in Regulation 13 of the
CHALR-04:

           ".... Obligations of Customs House Agent. 13. - A Customs
           House Agent shall -
           (a) obtain an authorisation from each of the companies,
           firms or individuals by whom he is for the time being
           employed as Customs House Agent and produce such
           authorisation whenever required by the Deputy
           Commissioner of Customs or Assistant Commissioner of
           Customs;
           (b) transact business in the Customs Station either
           personally or through an employee duly approved by The
           Deputy Commissioner of Customs or Assistant
           Commissioner of Customs;
           (c) not represent a client before an officer of Customs in any
           matter to which he, as an officer of the Department of
           Customs gave personal consideration, or as to the facts of
           which he gained knowledge, while in Government service;
           (d) advise his client to comply with the provisions of the Act
           and in case of non-compliance, shall bring the matter to the
           notice of the Deputy Commissioner of Customs or Assistant
           Commissioner of Customs;
           (e) exercise due diligence to ascertain the correctness of any
           information which he imparts to a client with reference to
           any work related to clearance of cargo or baggage;
           (f) not withhold information contained in any order,
           instruction or public notice relating to clearance of cargo or
           baggage issued by the Commissioner of Customs, from a
           client who is entitled to such information;
           (g) promptly pay over to the Government, when due, sums
           received for payment of any duty, tax or other debt or

CUSAA 1-2016 & 12-2016                                              Page 7 of 15
            obligations owing to the Government and promptly account
           to his client for funds received for him from the Government
           or received from him in excess of Governmental or other
           charges payable in respect of the clearance of cargo or
           baggage on behalf of the client;
           (h) not procure or attempt to procure directly or indirectly,
           information from the Government records or other
           Government sources of any kind to which access is not
           granted by the proper officer;
           (i) not attempt to influence the conduct of any official of the
           Customs Station in any matter pending before such official
           or his subordinates by the use of threat, false accusation,
           duress or the offer of any special inducement or promise of
           advantage or by the bestowing of any gift or favour or other
           thing of value; m not refuse access to, conceal, remove or
           destroy the whole or any part of any book, paper or other
           record, relating to his transactions as a Customs House
           Agent which is sought or may be sought by the
           Commissioner of Customs;
           (k) maintain records and accounts in such form and manner
           as may be directed from time to time by a Deputy
           Commissioner of Customs or Assistant Commissioner of
           Customs and submit them for inspection to the said Deputy
           Commissioner of Customs or Assistant Commissioner of
           Customs or an officer authorised by him whenever required;
           (1) ensure that all documents, such as bills of entry and
           shipping bills delivered in the Customs Station by him show
           the name of the importer or exporter, as the case may be,
           and the name of the Customs House Agent, prominently at
           the top of such documents;
           (m) in the event of the licence granted to him being lost,
           immediately report the fact to the Commissioner of
           Customs;
           (n) ensure that he discharges his duties as Customs House
           Agent with utmost speed and efficiency and without
           avoidable delay...."
12.    Clause (e) of the aforesaid Regulation requires exercise of due
diligence by the CHA regarding such information which he may give to his
CUSAA 1-2016 & 12-2016                                               Page 8 of 15
 client with reference to any work related to clearance of cargo. Clause (l)
requires that all documents submitted, such as bills of entry and shipping
bills delivered etc. reflect the name of the importer/ exporter and the name of
the CHA prominently at the top of such documents. The aforesaid clauses
do not obligate the CHA to look into such information which may be made
available to it from the exporter/ importer. The CHA is not an inspector to
weigh the genuineness of the transaction.       It is a processing agent of
documents with respect to clearance of goods through customs house and in
that process only such authorized personnel of the CHA can enter the
customs house area. What is noteworthy is that the IE Code of the exporter
M/s H.M. Impex was mentioned in the shipping bills, this itself reflects that
before the grant of said IE Code, the background check of the said importer/
exporter had been undertaken by the customs authorities, therefore, there
was no doubt about the identity of the said exporter. It would be far too
onerous to expect the CHA to inquire into and verify the genuineness of the
IE Code given to it by a client for each import/ export transaction. When
such code is mentioned, there is a presumption that an appropriate
background check in this regard i.e. KYC etc. would have been done by the
customs authorities. There is nothing on record to show that the appellant
had knowledge that the goods mentioned in the shipping bills did not reflect
the truth of the consignment sought to be exported. In the absence of such
knowledge, there cannot be any mens rea attributed to the appellant or its
proprietor. Whatever may be the value of the goods, in the present case,
simply because upon inspection of the goods they did not corroborate with
what was declared in the shipping bills, cannot be deemed as mis-declaration
by the CHA because the said document was filed on the basis of information
provided to it by M/s H.M. Impex, which had already been granted an IE
Code by the DGFT. The grant of the IE Code presupposes a verification of


CUSAA 1-2016 & 12-2016                                             Page 9 of 15
 facts etc. made in such application with respect to the concern or entity. If
the grant of such IE Code to a non-existent entity at the address WZ-156,
Madipur, New Delhi - 63 is in doubt, then for such erroneous grant of the IE
Code, the appellant cannot be faulted. The IE Code is the proof of locus
standi of the exporter. The CHA is not expected to do a background check of
the exporter/client who approaches it for facilitation services in export and
imports. Regulation 13(e) of the CHALR 2004 requires the CHA to:
"exercise due diligence to ascertain the correctness of any information
which he imparts to a client with reference to any work related to clearance
of cargo or baggage" (emphasis supplied). The CHAs due diligence is for
information that he may give to its client and not necessarily to do a
background check of either the client or of the consignment. Documents
prepared or filed by a CHA are on the basis of instructions/documents
received from its client/importer/exporter. Furnishing of wrong or incorrect
information cannot be attributed to the CHA if it was innocently filed in the
belief and faith that its client has furnished correct information and veritable
documents. The mis-declaration would be attributable to the client if wrong
information were deliberately supplied to the CHA. Hence there could be no
guilt, wrong, fault or penalty on the appellant apropos the contents of the
shipping bills. Apropos any doubt about the issuance of the IE Code to M/s
H.S. Impex, it was for the respondents to take appropriate action.
Furthermore, the inquiry report revealed that there was no delay in
processing the documents by the appellant under Regulation 13(n).

13.    This Court in Ashiana Cargo Services vs Commissioner of Customs
(I & G) 2014 (302) E.L.T. 161 (Del) has inter alia held:

              "..... 10. Beginning with the facts, there is virtually no
              dispute. There is a concurrent finding of fact by the
              Commissioner and the CESTAT that the appellant did not
              have knowledge that the illegal exports were effected
CUSAA 1-2016 & 12-2016                                              Page 10 of 15
               using the G cards given to VK's employees. There was no
              active or passive facilitation by the appellant in that
              sense. Undoubtedly, the provision of the G cards to non-
              employees itself violated the CHA Regulations. This is an
              admitted fact, but it is not the Revenue's argument (nor is
              it the reasoning adopted by the Commissioner or the
              CESTAT) that this violation in itself is sufficiently grave
              so as to justify the extreme measure of revocation. Not
              any and every infraction of the CHA Regulations, either
              under Regulation 13 ("Obligations of CHA") or
              elsewhere, leads to the revocation of license; rather, in
              line with a proportionality analysis, only grave and
              serious violations justify revocation. In other cases,
              suspension for an adequate period of time (resulting in
              loss of business and income) suffices, both as a
              punishment for the infraction and as a deterrent to future
              violations. For the punishment to be proportional to the
              violation, revocation of the license under Rule 20(1) can
              only be justified in the presence of aggravating factors
              that allow the infraction to be labeled grave. It would be
              inadvisable, even if possible, to provide an exhaustive list
              of such aggravating factors, but a review of case law
              throws some light on this aspect. In cases where
              revocation of license has been upheld (i.e. the cases relied
              upon by the Revenue), there has been an element of active
              facilitation of the infraction, i.e. a finding of mens rea, or
              a gross and flagrant violation of the CHA Regulations. In
              Sri Kamakshi Agency (supra), the licensee stopped
              working the license, but rather, for remuneration,
              permitted his Power of Attorney to work the license, thus
              in effect transferring the license for money. As the
              CESTAT noted, "9.......................[a]pplicant instead of
              discharging his functions as a Custom House Agent in
              accordance with the Regulations, in flagrant violation of
              those Regulations went to the extent of encashing the
              facilities made available to him as a CHA by selling it for
              a price". Moreover, the Power of Attorney was - as a
              matter of fact - "actively involved in the fraudulent act in
              connivance with the importers and others and that as per
              the Power of Attorney Bond executed by Sri K. Natarajan,
              all acts, deeds and things done by Sri D. Sukumaran were
              to be construed as if they were done by himself. Therefore

CUSAA 1-2016 & 12-2016                                                 Page 11 of 15
               virtually all the fraudulent activities carried out by the
              Power of Attorney of Thiru Natarajan were to be treated
              as having been carried out by Thiru K. Natarajan
              himself", i.e. the licensee. In OTA Kandla, too, mens rea
              (i.e. knowledge) of the licensee was established. By a
              statement of the petitioner under Section 108, Customs
              Act, followed by the inquiry, it was clear that the licensee
              was aware that the consignment contained gypseous
              alabaster, a prohibited substance, but nonetheless,
              participated in its release from the Kandla Port. In
              CUS.A.A.24/2012 Page 10 Santon Shipping (supra), the
              adjudicating authority came "to the conclusion that the
              fraud in this case has been committed in so many
              consignments over a long period of time and the same
              could not have happened without the connivance of the
              CHA". The revocation of the license was again informed
              by the fact of connivance (i.e. mens rea as to the
              infraction) of the CHA. In Eagle Transport (supra), the
              CHA transferred the license altogether. As the CESTAT
              noted, "... the activities of the appellant firm were
              controlled day to day, not by Shrimankar but by
              employees of Amol Shipping Agency. We do not see how
              this does not amount to transfer of the licence in all but
              name. Hence, we must hold that the first and second
              articles of charge have been rightly held as proved."
              Moreover, more than 100 blank shipping bill forms were
              sent to a third-party. Following these aggravating factors,
              the penalty of revocation was justified by the CESTAT.
              Similarly, in HB Cargo (supra), relied upon by the
              majority of the CESTAT, the case did not concern any
              ordinary infraction of the CHA Regulations, but "an act
              of corruption", where blank shipping bills were issued by
              the partner and authorized representative of the CHA for
              a consideration of `150 per shipping bill.
              11. Viewing these cases, in the background of the
              proportionality doctrine, it becomes clear that the
              presence of an aggravating factor is important to justify
              the penalty of revocation. While matters of discipline lie
              with the Commissioner, whose best judgment should not
              second-guessed, any administrative order must
              demonstrate an CUS.A.A.24/2012 Page 11 ordering of
              priorities, or an appreciation of the aggravating (or

CUSAA 1-2016 & 12-2016                                               Page 12 of 15
               mitigating) circumstances. In this case, the Commissioner
              and the CESTAT (majority) hold that "there is no finding
              nor any allegation to the effect that the appellant was
              aware of the misuse if the said G cards", but do not give
              adequate, if any weight, to this crucial factor. There is no
              finding of any mala fide on the part of the appellant, such
              that the trust operating between a CHA and the Customs
              Authorities (as a matter of law, and of fact) can be said to
              have been violated, or be irretrievably lost for the future
              operation of the license. In effect, thus, the
              proportionality doctrine has escaped the analysis.
              12. Learned Senior Standing Counsel for the Customs has
              stressed that the infraction in this case is not a routine
              matter, but rather, illegal smuggling of narcotics by the G
              card users. However, given the factual finding that the
              CHA was not aware of the misuse of the G cards (and
              thus, also unaware of the contents being smuggled), no
              additional blame can be heaped upon the CHA on that
              count alone. Rather, the only proved infraction on record
              is of the issuance of G cards to non-employees, as
              opposed to the active facilitation of any infraction, or any
              other violation of the CHA Regulations, whether gross or
              otherwise. Neither have any such allegations been raised
              as to the past conduct of the appellant, from the time the
              license was granted in January, 1996. Equally, it is
              important to note that the appellant has - as of today -
              been unable to work the license for 8 years, and thus been
              penalized in this manner. This is not to say that
              CUS.A.A.24/2012 Page 12 the trust operating between
              the Customs Authorities and the CHA is to be taken
              lightly, or that violations of the CHA Regulations should
              not be dealt with sternly. A penalty must be imposed. At
              the same time, the penalty must - as in any ordered system
              - be proportional to the violation. Just as the law abhors
              impunity for infractions, it cautions against a
              disproportionate penalty. Neither extreme is to be
              encouraged. In this case, in view of the absence of any
              mens rea, the violation concerns the provision of G cards
              to two individuals and that alone. A penalty of revocation
              of license for this contravention of the CHA Regulations
              unjustly restricts the appellant's ability to engage in the
              business of the CHA for his entire lifetime. As

CUSAA 1-2016 & 12-2016                                               Page 13 of 15
               importantly, it skews the proportionality doctrine,
              substantially lowering the bar for revocation as a
              permissible penalty, especially given the dire civil
              consequences that follow. On the other hand, the minority
              Opinion of the CESTAT, delivered by the Judicial
              Member, correctly appreciates the balance of relevant
              factors, i.e. knowledge/mens rea, gravity of the infraction,
              the stringency of the penalty of revocation, the fact that
              the appellant has already been unable to work his license
              for a period of 6 years (now 8 years), and accordingly
              sets aside the order of the Commissioner dated
              24.01.2005..."


14.    Any act to defraud presupposes the intention to obtain something
fraudulently. In the present case, the appellant (through its proprietor) has
all along contended that the documents were filed unauthorizedly by a
person incompetent to do so; it has not defended the action of Mr Lalit
Katoch; it claims ignorance and innocence of the contents of the
consignment; it objects to the very filing of the two shipping bills by either
Mr Katoch or any person authorised on its behalf, hence there cannot be a
presumption of its deliberate act/intention to defraud. There is no evidence of
active facilitation of clearance of the consignment through customs by the
appellant, hence, no mens rea can be inferred to defraud the government for
obtaining duty drawback through a fraudulent transaction. Consequently, the
appellant cannot be faulted or punished in the manner it has been.

15.    In these circumstances, the revocation of the appellant‟s CHA license
is unjustified and is accordingly, set aside. The revocation of license which
is in operation since 2005 i.e. almost 12 years, is itself a severe punishment
and could also serve as a reprimand to the CHA to conduct its affairs with
more alacrity. In these circumstances, the forfeiture of the security amount
and the imposed penalty of ` 1 lakh also is set aside. The said amount shall
be credited to the appellant‟s account. If the tenure of the license has expired

CUSAA 1-2016 & 12-2016                                               Page 14 of 15
 but is otherwise extendable, then upon the appellant‟s application such
extension would be granted as per rules. However, if an application is to be
made for grant of a new license, then such an application if made, would be
considered under the extant Regulations. The appeals are disposed off with
the above directions.



                                                      NAJMI WAZIRI, J.

S. RAVINDRA BHAT, J. MARCH 27, 2017 kk CUSAA 1-2016 & 12-2016 Page 15 of 15