₹17.7 Crore Penalty on Customs broker Challenge Rejected: Allahabad HC Directs Broker to Avail Appeal [Read Order]
The Court directed that any appeal filed within two weeks be entertained on merits without objection on limitation.
The Allahabad High Court declined to exercise writ jurisdiction to interfere with a penalty of ₹17,71,27,830 imposed on a Customs Broker under Section 114(iii) ofthe Customs Act, 1962. The Court held that the matter was fully appealable under the statutory framework, and therefore the petitioner must avail the appellate remedy instead of invoking Article 226.
The writ petition was filed by Rajesh Tripathi, a licensed Customs Broker, challenging the adjudication order, which imposed a penalty of ₹17.7 crore for his alleged involvement in the mis-declaration of export goods.
Know How to Prepare Estimation and Viability for Project Reports? Know more Click here
The proceedings stemmed from allegations of mis-disclosure of the value of exported goods by an exporter. The petitioner had played an advisory role in facilitating the export documentation. The adjudicating authority invoked Section 147, Section 114(iii) and Section 114(AA) of the Customs Act to hold the petitioner liable as an agent of the exporter, resulting in the imposition of the penalty.
The authority held that under Regulation 2(i)(d) of the Customs Brokers Licensing Regulations, 2018 (CBLR), a Customs Broker acts as an agent of the exporter, and therefore the petitioner was responsible for lapses pertaining to mis-declaration of value.
Nitin Chandra Mishra, relied upon Regulations 10(d) and 10(e) of the CBLR, 2018 to assert that the petitioner’s obligations were limited and did not justify the imposition of penalty. It was submitted that the penalty order was unsustainable and warranted interference under writ jurisdiction.
Opposing the writ petition, Dhananjay Awasthi, raised a preliminary objection regarding maintainability. He argued that the petitioner acted as the exporter’s agent and was therefore as per Sections 147, 114(iii), 114(AA) of the Act and Regulation 2(i)(d) of the CBLR, 2018 he is liable. Also Read:
The Bench of Justice Saumitra Dayal Singh and Justice Kunal Ravi Singh, upheld the preliminary objection and refused to interfere. The Bench observed that the statutory remedy of appeal was adequate and that factual disputes regarding the petitioner’s alleged involvement could only be examined by the appellate forum.
The Court also said that writ jurisdiction under Article 226 cannot be invoked unless exceptional circumstances exist, which were absent in the present case. Accordingly, the writ petition was dismissed with liberty to the petitioner to file a statutory appeal.
Further, it was directed that if the petitioner files an appeal within two weeks, it shall be entertained on merits without any objection on limitation, and all grounds raised in the writ petition shall remain open for independent consideration.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
