The Delhi bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) upheld the Penal action taken against Customs Broker as he had abated the export Consignment of Prohibited Gutkha pouches.
The appellant Sanjay Prabhakar, is a Customs Broker challenged the Order-in-Original No. passed by the Commissioner of Customs, (Airport & General).The appellant is engaged in customs clearance of export and import of goods. During his usual course of business, appellant filed a Shipping Bill No. 7549865 dated 24.07.2017 in the name of M/s Navrang Jewel and Export at the port ICD Loni wherein goods were declared as Pan Masala and other house hold products such as comb, sofa, broom brush etc.
The goods were examined and Let Export Order was passed by the proper officer and goods were thereafter dispatched from ICD Loni to Gateway port of Pipavav for further export. However, on information, DRI stopped and further examined the goods at Pipavav, wherein as against the declared pan masala, DRI allegedly found 42,00,000 number of Gutkha pouches – a prohibited item.
During the course of investigation, appellant in his statement stated that on the instructions of Shri Mehmood (a middleman) and Shri Shubham Garg (the exporter), appellant prepared invoice and other documents and filed the said Shipping Bill, that he had agreed to clear the goods on payment of Rs.5,000/- as clearing charges while other logistic charges were separate and that appellant was not informed by said Shri Mehmood and Shri Shubham Gard, that the goods being exported contained Gutkha and thus the appellant was not in the knowledge of real content of the consignment.
It was claimed that since the said statement dated 06.08.2018 was not as per wishes of DRI, they detained the appellant and pressurized and threatened him of dire consequences. Under the pressure caused by DRI, appellant in his later statement stated that during their meeting, Shri Shubham Garg and Shri Mehmood had told him that they wanted to export Gutkha and other house hold items to Kuwait and thus appellant knew that there was Gutkha in the consignment which was being cleared from customs by his firm.
The DRI issued a show cause notice proposing penal action against the appellant and the Commissioner (Airport & General) suspended the licence of the appellant and issued a show cause notice proposing to hold the appellant responsible for contravention of various provisions under Regulation 10 of Customs Brokers Licensing Regulations, 2013 ( CBLR, 2013) and revocation of their Customs Broker (C.B.) licence, forfeiture of security and penalty under Regulation 18 of CBLR, 2013. An Inquiry Officer was appointed to enquire into the matter.
The CB licence of the appellant which was valid till 29.12.2021 was revoked, his security deposit of Rs. 75,000/- was forfeited and a penalty of Rs. 50,000/- was imposed on the appellant. The appellant had requested for granting cross examination of Shri Shubham Garg, the exporter, Mehmood @ Guddu, Shri Manoj Srivastava, Inspector and Shri Dayashankar, Superintendent, to bring to the fore true and correct facts of the case. However, the same was denied on the ground that appellant was adopting the dilatory tactics.
The authorised representative submitted that the appellant had not followed the requirements as per Clause 10(a) of CBLR, 2018. He stated that the fabricated documents were prepared in the office of the F card holder. It is on record that Sh. Shubham Garg had sublet his IEC for monetary consideration and the Customs broker was aware of the same. The appellant failed to inform the customs authorities about this and had contravened the provisions of CBLR. Such wilful omission on part of the F card holder to verify the authenticity having a prior knowledge of verifying the genuineness of the importer/exporter, address, identity proves beyond doubt the circumstantial evidence of the connivance of the appellant.
A two member bench comprising Dr. Rachna Gupta, Member (Judicial) and Ms. Hemambika R Priya, Member (Technical) observed that the confessional statements of the appellant clearly indicate that he was aware that actual exporter was Shri Salim Dola whereas the IEC being used was in the name of Shri Shubham Garg, proprietor of Navrang Jewel and Exports. Sh. Garg in his statement accepted that he had allowed Mehmood, alias Guddu to use his IEC for ₹50,000 per consignment.
The Tribunal held that “the retraction by the appellant cannot negate the evidentiary value of his confessional statements. Further, the denial of request for cross examination, in the face of the said statement of the appellant, cannot be a violation in view of the above. It is also interesting to note that other than the appellant, none of the others investigated in this offence have retracted their statements.”
While dismissing the appeal, the CESTAT upheld the impugned order.
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