The two member bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ), Delhi, upheld the penalty of ₹50,000 for non-compliance with the CBLR regulations while also addressing the abatement of illegal exports.
The present appeal challenged the revocation of the Customs Broker License (CBL), the forfeiture of the security deposit, and a penalty of ₹50,000 imposed by Order No. 80/MK/POLICY/2020 dated September 30, 2020. This action was taken due to violations of Regulation 10(a), 10(d), 10(e), 10(m), and 10(n) of the Customs Broker Licensing Regulations, 2018.
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The appellant, M/s Jetset Shipping Private Limited, holds a valid CBL until October 9, 2026. An investigation revealed fraudulent exports by dubious exporters, M/s Aero Exports and M/s Yellowsky Exports, linked to M.K. Arora, the Director of the appellant company. The proprietor of M/s Aero Export, Ganga Singh Yadav, failed to respond to multiple summons.
A show cause notice was issued to the appellant on March 19, 2020, regarding the revocation of the license, the forfeiture of the security deposit as per Regulation 14 and Regulation 17 of CBLR, 2018, and the imposition of a penalty under Regulation 18. An inquiry report dated June 15, 2020, concluded that the Customs Broker contravened multiple provisions of Regulation 10.
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The Commissioner, determining that the Customs Broker acted irresponsibly and facilitated illegal exports to obtain ineligible IGST refunds, revoked the license, forfeited the security deposit, and imposed a penalty of ₹50,000 through the impugned order.
Mr. Anish Mittal, representing the appellant, denied the violations, referencing the Tribunal’s decision in their previous case (Final Order No. 55570/2024 dated April 18, 2024), where a similar order was set aside.
In contrast, M.R. Dhaniya, representing the revenue, reiterated the Adjudicating Authority’s findings and distinguished the earlier case, highlighting that M.K. Arora and two dummy export companies were involved in the wrongful availment of IGST refunds, thereby violating the regulations.
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The bench, comprising Binu Tamta (Judicial Member) and P.V. Subba Rao (Technical Member), found the current case distinguishable from the previous one. The earlier allegations concerned only a violation of Regulation 10(n), whereas the present case included multiple violations of various regulations, warranting a broader consideration.
Ultimately, the bench observed that the appellant failed to comply with CBLR, 2018, and abetted illegal exports. The misconduct deemed the appellant unfit to conduct Customs Broker business, justifying the actions taken. Consequently, the bench affirmed the impugned order, dismissing the appeal.
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