Mohak Enterprise vs C.C.-Ahmedabad

Ramesh Nair, Member (J)

This appeal is directed from the order in original no. AHM-CUSTM-000-COM-004-22-23 dated 27.04.2022 wherein the Learned Commissioner dropped the proceeding initiated for revocation of the Customs Broker License against the Customs Broker which is the present Appellant under Regulation 17 of the CBLR 2018 and also dropped the proceeding of forfeiture of the part or whole security deposit furnished by the Customs Broker for issue of Customs Broker License. However, a penalty of Rs.50,000/- was imposed in terms of Regulation, 18 of CBLR 2018. The Appellant against the imposition of the said penalty of Rs.50,000/- filed the present appeal. The penalty was imposed against the Appellant under Regulation 18 of CBLR, 2018 for the violation of regulation 10(o) and Regulation 10(b) of CBLR 2018 in as much as the G Card holder of the Appellant firm did not obtain the KYC documents as mandated by circular no. 9/2010-Customs dated 08.04.2010. It was also alleged that the Appellant have not verified the correct value of the goods attempted to be exported for availing excess for refund of GST.

Shri Saurabh Dixit Learned Counsel appearing on behalf of the appellant submits that as regard the allegation that the Appellant have not visited physically the premises of the exporter, he submits that the export took place during May June 2020 when there was complete lockdown during COVID-19 pandemic and It was impossible to physically visit the premises of the exporter which any way is not required for CHA under the Law. The Appellant had duly collected documents such as IEC, GST registration, PAN Card, bank verification certificate which is sufficient compliance for KYC verification under CBLR 2018. The fact of exporter actually existing on given address in Mumbai is not in dispute. The IEC, PAN card, Bank Account, GST registration are of genuine and found to exist in the name of exporter at the very same address in Mumbai. The Appellant as a Custom Broker acted in normal course as a custom broker for filing, shipping bills on behalf of the exporter and there is no finding against such fact. He submits that the Appellant had not concerned with logistic part and had merely acted as Customs Broker in filing document on behalf of the exporter and had not even charged any access charges beyond the ordinary service charges. Even such charges have not been received and as such the Appellant are in fact a victim rather than accessory to any wrong doing on part of the exporter. He submits that disputed 50 shipping bills as also 75 shipping bills in the past for very same exporter were physically examined and assessed by the Customs and even let export orders (LEOs) were granted in this regard. The bona fide or exporter as well as export value was as such approved by the Customs themselves which is not in disputes ever. He submits in this fact there is no fault or mala fide on the part of the Appellant therefore the penalty was wrongly imposed. In support he placed reliance of the following judgments:

• Network Industries Ltd-2019 (369) ELT 1274 (Tn.-Chennai)

• Revannath Gabaji Gawade- 2007 (211) ELT 432 (Tn. Mumbai)

• Kunal Travels (Cargo)-2017 (354) ELT 447 (Del.)

• Shiva Khurana- 2019 (367) ELT 550 (Del.)

• Nirnesh Suchde- 2007 (209) ELT 276 (Tri.-Mum.)

• Setwin Shipping Agency- 2010 (250) ELT 141 (Tri.-Mum.)

• Manjulatha Cargo P Ltd-2021 (375) ELT 245 (Tn. Bang.)

• CBEC Circular No. 9/2010-Cus., dated 08.04.2010

• Perfect Cargo & Logistics- 2020 (12) TMI 649- CESTAT NEW DELHI

• Trinity International Forwarders- 2023 (8) TMI 133 –CESTAT DELHI

• Baid International Services Ltd-2023 (8) TMI 1056- CESTAT KOLKATA

• Transasia Shipping Services- 2023 (6) TMI 254-CESTAT BANGLORE

• Anax Air Services Pvt Ltd-2022 (I) TMI 115-CESTAT New Delhi

Shri Ajay Kumar Samota, Learned Superintendent (AR) appearing on behalf of the revenue reiterates the finding of the impugned order.

On careful consideration of the submission made by both the sides and perusal of records, I find that the penalty was imposed on the allegation that the appellant has not complied with the condition of KYC of the exporter and the exporter was not properly advised about the valuation of the goods. I find that as submitted by the appellant and which is undisputed fact that the appellants have obtained IEC, GST registration, PAN card, Bank verification certificate therefore, there is a sufficient compliance of KYC verification and in case of any wrong doing on the part of exporter by such compliance no allegations can be made against the custom Broker. As regard the allegation that the appellants have not verified the value of the goods which was found in excess in case of the export of goods, I find that the valuation of the goods is not the responsibility of the custom broker. The custom broker has limited responsibility of documentation on behalf of the exporter and of course the verification of KYC which is not disputed in present case. Therefore, both the allegations are not sustainable. There is no case of the department that the appellants have colluded with the exporter knowingly about fraudulent export of goods with intension to avail the refund of GST, therefore in absence of any such evidence merely because some fraud was committed by the exporter the custom broker cannot be implicated automatically even though he has no role in the offence of fraudulent export. The judgment relied upon by the learned Counsel directly supports the case of the appellant. Therefore, in my considered view there is no reason in the present case to penalise the appellant under CBLR 2018.

Accordingly, the penalty is set aside. Appeal is allowed.