Document Fragment View

Matching Fragments

2.2 Investigation was undertaken by Serious Fraud Investigation Office (SFIO) in the matter of M/s. ABC Cotspin Pvt. Ltd. (ABCCPL) on the basis of complaint made by various Banks, namely State Bank of India, Bank of Baroda and Axis Bank. They reported that ABCCPL committed a fraud on them by availing export finance by submission of export bills without making exports.

2.3 Investigation report pointed out that checklists have been issued to ABCCPL by M/s. RSS Shipping Pvt. Ltd. and M/s. Kotak Multilink Logistic without ensuring the receipt of merchandise at the port and before uploading the data on the ICEGATE portal. They also facilitated issuance of House Bills of Lading from the freight forwarding companies, i.e. M/s. Seamax Logistics Ltd. and M/s. United Container Lines Pvt. Ltd. M/s. RSS Shipping Pvt. Ltd. was operating the CHA licence in the name of the appellant herein and M/s. Harin Transport.

 Accordingly he prays that the order of the Commissioner, Nagpur be made applicable in their case also.

3.3 Learned Authorised Representative reiterates the findings recorded in the impugned order.

4.1 We have considered the impugned order along with the submissions made in the appeal and during the course of argument.

4.2 The Principal Commissioner has in her order recorded the findings as follows:-

"6. In respect of Regulation 11(d) of CBLR 2013 it has been alleged that the CB did not advise their client to comply with the provisions of the Act, other allied Acts and the Rules and Regulations thereof, and in case of non compliance, did not bring the matter to the notice of the DC/AC of Customs. The defence submission stated that on the basis of the checklist, no export can take place; that the CB never issues a Bill of Lading; that under the CBLR 2018, there is no obligation to meet the Exporter and there is no authority with the CB to ask for return of the house BL from the exporter. I find that the investigation revealed that M/s. ABCCPL (the exporting firm) connived with CB M/s. RSS Shipping (who were using the CB licence M/s. Ramesh Transport Company) other CBS and freight forwarding companies to conceal the facts that the exports of merchandise did not take negotiation/availment of bank finance on export bills and presented the place at the time of documents as if the exports had taken place. By doing so, M/s. ABCCPL induced the banks to grant advance against the export bills by negotiation/discount (crediting of funds into the account) and committed the act of "Cheating". I find that Shri Sanjeev Verma, Director of M/s. RSS Shipping P Ltd. in his statement dated 24.03.2018 and 27.07.2018 recorded on oath as per provisions of Section 217(4) of the Companies Act, 2013, stated that they were doing CHA work under the oral authority of M/s. Ramesh Transport Company; that they had only oral authority from Shri.

5 C/86442/2021 Ramesh P. Mange, Proprietor of CB M/s. Ramesh Transport Company; that they used to make the shipping bill data and forward the same to the office of M/s. Ramesh Transport Company, for uploading the same on the "ICEGATE of Customs Department, which they used to do from their office; that they took responsibility for all of them Le. M/s. Seamax Logistics Ltd, M/s 38 Shipping P Ltd. (themselves) and M/s ABCCPL were responsible for the exports which did not happen and the BLs were wrongly stamped as "Shipped on Board". Hence, it is evident that Shri Ramesh P. Mange, proprietor of the CB M/s. Ramesh Transport Company allowed his CB Licence to be misused by M/s. RSS Shipping P. Ltd. far uploading shipping bill data prepared by them on the "ICEGATE of Customs Department I find from investigation that for CB knew the purpose and also the facts of non-completion of exports for previously issued House BL/MTD, but instead of informing the Customs Authorities about the non compliance by the exporter they continued to issue checklists for fresh/further invoices which clearly proves the mens rea of the CB. The CB unlawfully allowed M/ RSS to use their licence. The CB no produce any written authorisation from their client M/s ABCCPL. There is no evidence of interaction between the Customs Broker and the IEC holder of the exporting firm M/s. ABCCPL for the Customs Broker to give proper and sound advice to the exporter and the CB did not make any effort to meet/contact the exporter. It is clear that CB neither advised his client regarding following proper procedure nor did he bring the apparent irregularity to knowledge of Customs Authorities. Thus, the Customs Broker has intentionally violated the Regulation 10(d) of the CBLR, 2018, and above discussion clearly proves contravention of provisions of Regulation 10(d) of the CBLR, 2018.

7. In respect of 10(e) of the CBLR, 2018, the defense submission stated that Inquiry Officer had recorded a finding that the CB neither restricted the freight forwarder or the exporter for wrong doings nor informed the Department about the misuse of check list, house BL/MTDs; that unless and until it is established that the CB had any prior knowledge about the misuse of the checklist, the CB has no obligation to inform the Department about the same. I find that Shri Ramesh P. Mange, proprietor of 6 C/86442/2021 the CB M/s. Ramesh Transport Company allowed his CB Licence to be used by M/s. RSS Shipping P. Ltd, unlawfully for uploading shipping bills data prepared by them on the "ICEGATE" of Customs Department. It is evident from the investigation that the CB obtained the House BLS / MTDS from freight forwarders before or without receipt of merchandise/handing over merchandise and completion of Customs/ export formalities (before clearance of cargo by Customs for export) and without LEO date, and handed over those BLS/ MTDs along with the checklist to M/s RSS Shipping for onward submission to M/s. ABCCPL to enable them to get the export bills discounted with the banks. I find from investigation that despite lapse of more than 3 months (in many cases more than 6 months) for completion of exports for already issued checklists with House BLS/MTDs, the CB M/s. Ramesh Transport Co. did not make effort to verify the genuineness of the exporter and their correctness of their Shipping Bills, BL and MTDs. The CB M/s. Ramesh Transport Company knew the fact that exports had not been taken place for already issued House BL/ MTD and the exporter was continuously asking for fresh checklist, strangely it did not raise suspicion in the mind of an experienced CHA. Dove acts of CB show connivance on their part to perpetuate the fraud by M/s. ABCCPL and Shri Ashish Jobanputra on banks. The CB clearly, knowingly aided and abetted the offence and facilitated the same through deliberate layering of intermediaries as he was part of the gang of the fraudsters. It is clearly evident that the Customs Broker deliberately processed the Checklist as per the directions of M/s. RSS Shipping without exercising due diligence to ascertain the correctness of the information and impart same to the exporter. Thus, it is clear that the C has deliberately not carried out obligation cast on him so as to feign innocence later Hence, conclude that the CB has intentionally violated the provisions of Regulation 10je) of CBLR, 2018.