There was proper verification on the portion of the customs house agent (CHA) concerning the genuineness of the Importer-Exporter Code (IEC) and GSTIN, the Delhi High Court ruled.
The bench of Justice Yashwant Varma and Justice Dharmesh Sharma witnessed that only allegations that certain other individual was importing the goods in the name of the importers whose names were specified in the entry bills, does not direct the identity of the importer doubtful particularly when their was an arrangement with the mutual support of the importer and the beneficial owner.
For the matter no basis for the adjudicating authorities to issue the impugned order hence suspending the CHA license on the foundation of the statements of the importers that were otherwise also abandoned.
For the investigation, the statement of Mr. Suresh Kumar Aggarwal, a partner of the respondent/CB/CHA, was recorded dated January 15 and 22, 2018.
Read Also:- Best Strategies for GST Officials to Prevent ITC Fraud
The taxpayer has eased the clearance work for the specific imported goods on the grounds of the commission without validating the IEC numbers that have been utilised for the imports and has less knowledge that the mastermind was Mr Yusuf Pardawala, who was the real beneficiary or the beneficial owner.
Before the taxpayer, the show cause notice was issued asking for clearance of the imported goods at the customs ports via the respondent was in breach of the different provisions of the Customs Broker License Regulations, 2018.
Based on the breach of regulations 10(a), 10(d), and 10(n) of the CBLR, the SCN was confirmed, revocation of the license is there, invoking the powers under regulations 14 and 17(7) of the CBLR. The taxpayer’s security deposit was indeed seized and a penalty was levied.
To the CESTAT the taxpayer has filed a petition. The tribunal ruled that only the suspension of the license and after that its revocation under Regulation 16 of the CBLR did not prevent the Commissioner (Appeal) from executing an inquiry against the CB/CHA in terms of the powers under Regulations 14 and 17 of the CBLR.
Under Regulation 16 an action is immediately laid on the seriousness and gravity of the alleged offence while Regulation 17 defines a whole process to hear the concern of the party.
CESTAT stated that the appreciation of the proofs drawn based on the record revealed that the petitioner’s case CHA was in breach of the regulations 10(a), 10(d), and 10(n) of CBLR was not incurred, and therefore, the impugned order and the penalty charged were set aside.
No direct proof is there for drawing the connivance concerning the undervaluation on the CHA’s part regardless the CHA was obligated to be charged for levying the penalty under section 114AA, the council argued.
During dismissing the petition of the council the court observed that CESTAT neither has conducted any patent illegality nor any manifest error in admiring the proof on the record.
| Case Title | Commissioner of Customs Versus ICS Cargo |
| Citation | CUSAA 51/2023 |
| Date | 13.10.2023 |
| Counsel For Appellant | Anish Roy |
| Counsel For Respondent | Prabhat Kumar |
| Delhi HC | Read Order |
