Document Fragment View

Matching Fragments

2. The Commissioner of Customs (Export) Jawaharlal Nehru Custom House, Nhava Sheva vide letter dated 20.10.2010 had informed the Commissioner of Customs (General) New Custom House, Mumbai that a case of evasion of ADD by MITPL involving willful suppression of facts, mis-statement, manipulation of documents based on advice given to the importer by DHL had been detected. DHL had violated the code of conduct prescribed under CHALR. Pursuant to the above report, the Commissioner of Customs (General), Mumbai vide Order No.25/2010 dated 22.10.2010 prohibited DHL from transacting any CHA related business in Mumbai Custom Zone I, II and III with immediate effect invoking Regulation 21 of CHALR. Vide the order impugned before us, the Commissioner observed that the CHA had full knowledge of manipulation of documents submitted to customs, had in their possession copies of original and manipulated documents and had advised the importer to evade payment of ADD. CHA had violated Regulation 13 (d) of CHALR in as much as they had failed to advise their client to comply with the provisions of the Customs Act 62 (the Act). It was evident to him that DHL had willfully manipulated the invoice, packing list, sea way bill and bill of lading in order to evade payment of ADD. By withholding original and manipulated documents, the CHA had failed in discharging its obligation under Regulation 13(d), 13(e), 13(n) and 19(8) of CHALR. Pending enquiry contemplated against DHL under Regulation 22 of CHALR and finding continuance of the CHA in transacting business prejudicial to the interest of the revenue, the impugned order was passed suspending the license of the CHA to prevent further misuse.

4. During hearing, the learned counsel for the appellant submitted that the finding of the Commissioner that the appellant had violated Regulation 13 (d) and perpetrated fraud by manipulating documents was without evidence. The impugned order was passed following the order of the Commissioner of the Customs(General), Mumbai which recorded that the importer had tampered the shipping documents in his office after discussion with DHL(paragraph 9). The thrust of his argument is that the finding of the Commissioner of Customs, Bangalore that DHL had willfully manipulated invoice, packing list, seaway bill and bill of lading in order to evade payment of ADD by withholding original and manipulated copies of the documents and advised the importer to evade payment of ADD in violation of Regulation 13(d), (e), (n) and 19(8) of CHALR was unsubstantiated and incorrect. He invites our attention to paragraph 8 of the Order No.25/2010 wherein the Commissioner of Customs(General), Mumbai had recorded the correspondence between Shri Suresh Narayanan, Operation Manager, DHL and the Customs Brokerage and Clearance Division of DHL regarding the correct provisions of the relevant notification which applied to the consignment imported by MITPL and the clarification by Shri Subash, Manager, Compliance and Training, DHL. It was stated that the correct Sl. No. would be 13 and 17 of the table to Notification No.12/2010 Cus. dated 19.10.2010 for the impugned goods if imported from China and Thailand, respectively. He had also clarified that if the client insisted on Sl. No. 16, the impugned goods would be subject to duty in terms of Sl. No. 17 of the notification. The Commissioner also recorded in para 10 of the order that DHL had refused the suggestion by MITPL that DHL may make appropriate correction of the shipping documents. We are shown the internal e-mail wherein the staff of DHL were directed not to carry out corrections of the documents. This was in August 2010. It is submitted that there was no evidence of the appellants carrying out any such corrections. The impugned order was passed on a wrong basis that DHL manipulated the documents. The order was therefore liable to be set aside.

5. Further it has been reported that from the above facts and other material evidences such as statements recorded, emails, printouts of documents taken from computers of M/s. DHL Lemuir Logistics P. Ltd., it appears that the CHA had full knowledge of manipulation of documents submitted to the Customs, had in their possession copies of original and manipulated documents and had advised the importer to evade payment of anti dumping duty. Further it was also reported that the CHA has grossly violated Regulation 13 (d) of CHALR 2004 in as much as they have not only failed to advise their client to comply with the provision of the Customs Act but instead willfully colluded in perpetrating the fraud. The CHA has also acknowledged that the original invoice, bill of lading, sea way bill and manipulated copies of invoice, sea way bill, bill of lading were available with them and that amendments were made to the said documents without any endorsement or seal of the Shipping Line.

Regulation 13 (d) of CHALR reads as follows:

REGULATION 13.?Obligations of Customs House Agent. - A Customs House Agent shall 
(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;

This provision clearly mandates that the CHA intimates the department any violation committed by the importer to obtain a benefit not authorized by law. In finding a violation of this provision, the fact whether the correction was carried out by the CHA or by MITPL has no relevance.The impugned order rendered a finding that DHL manipulated invoice, seaway bill and bill of lading in order to evade ADD by withholding original and manipulated documents. The finding that DHL manipulated invoice, seaway bill and bill of lading is not supported by evidence. However, in the paragraph 5 which precedes this observation contains the finding that the CHA had full knowledge of manipulation of documents submitted to the customs and that it had in its possession copies the original and manipulated documents. They had failed to advise their client to comply with the provisions of Act and colluded in perpetrating the fraud thereby violating regulation 13 (d) of CHALR. This finding, we observe, is correct.