In a recent ruling of Delhi High Court, the court set aside an order of CESTAT which imposed a penalty on appellant and allowed the appeal.
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An appeal was filed by the appellant, Rubal Logistics PVT LTD represented by Adv. Vibha Narang and Adv. Akash Garg against an order of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ). The order imposed a penalty of Rs 40,000/- as imposed on the appellant – Custom House Agent ( CHA ) was upheld on the basis of purported violations of clauses (d), (e) and (m) of Regulation 11 of Customs Brokers Licensing Regulations, 2013 ( CBLR ).
The respondent, The Commissioner of Customs, General, New Delhi represented by Adv.Anurag Ojha, Adv.Kumar Abhishek, Adv.Subham Kumar, Adv.Seema Tyagi, Adv.Veena Tyagi, Adv.Rajeev L. Seth and Adv. Sunder Singh, Advs. for Customs Adv.Sushila Narang, argued that the product Mobile Point of Sale Device ( MPOS ) was imported by M/s.Pax Technology India Pvt. Ltd and cleared through customs broker M/s. Rubal Logistics Pvt. Ltd, who is the appellant of this case.
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The appellant initially filed the Bill of Entry on the basis of invoices raised by M/s. Wang Technologies Ltd. by replacing earlier invoices raised by M/s. Pax Technology Ltd., Hong Kong to M/s. Pax Technology India Pvt. Ltd.
The adjudicating authority observed that the impugned goods were misclassified and misvalued. The authority also believed that the CHA acted in good faith believing the changed invoice to be the correct one and did comply with the formalities as that of KYC documentation. The authority was of the view that the license need not be revoked but penalty is imposed under 11 (d), (e) & (m) of CBLR, 2013.
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Though the case was initially raised against the importer for misclassification and undervaluation of imported articles, the CESTAT had taken note of the undisputed position that the action of revocation of license was ultimately recalled.
Hence from the above stated facts it is evident that the acts CHA could not have been violative of clauses (d), (e) and (m) of Regulation 11. But from his own statement the CHA has acknowledged his negligence. The CESTAT was of the opinion that the CH has committed violation of the regulations, therefore adjudicating authority has rightly imposed the penalty upon the appellant.
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The division bench comprising Justice Yashwant Varma and Ravinder Dudeja, observed that CESTAT did not proceed in the matter with due caution. The bench also noted that the principal allegation was solely made against the importer with respect to misdeclaration. Further the violations of clauses (d), (e) or (m) of Regulation 11 of the CBLR, 2013 can’t be discerned in this case. Thus the order of CESTAT imposing penalty upon the appellant is erroneous.
Therefore the order of CESTAT is set aside and appeal is allowed.
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