Customs Broker Not Liable for Verifying Importer's Document Correctness: CESTAT [Read Order]
The tribunal quashed penalties totalling ₹15,000 imposed on M/s Him Logistics Pvt. Ltd., a New Delhi-based customs broker.
![Customs Broker Not Liable for Verifying Importers Document Correctness: CESTAT [Read Order]](https://images.taxscan.in/h-upload/2025/06/29/2056235-customs-broker-importer-document-correctness-cestat-taxscan.webp "Customs Broker Not Liable for Verifying Importers Document Correctness: CESTAT [Read Order]")
In a significant ruling reinforcing the role of customs brokers, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Allahabad Bench, has held that a customs broker cannot be penalised for failing to verify the correctness of documents furnished by an importer. The tribunal quashed penalties totalling ₹15,000 imposed on the assessee., a New Delhi-based customs broker,...
In a significant ruling reinforcing the role of customs brokers, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Allahabad Bench, has held that a customs broker cannot be penalised for failing to verify the correctness of documents furnished by an importer. The tribunal quashed penalties totalling ₹15,000 imposed on the assessee., a New Delhi-based customs broker, for alleged involvement in mis-declaration of goods value by an importer.
The case arose from a consignment imported by M/s Shiv Shakti Enterprises, wherein customs authorities found that the declared value of goods was lower than the previously accepted value for similar goods by the same importer. The customs broker, Him Logistics Pvt. Ltd., had filed bills of entry based on the documents provided by the importer, including invoices reflecting the transaction value. The importer later accepted that the goods had been undervalued and paid the differential duty, interest, and penalties.
Despite this, the original adjudicating authority imposed penalties of ₹10,000 and ₹5,000 under Section 112(a) of the Customs Act, 1962, on the broker, citing its failure to advise the importer based on prior transactions. The Commissioner (Appeals) upheld the penalties, prompting Him Logistics Pvt. Ltd. to approach the CESTAT.
Delivering the verdict, the bench comprising Mr. P.K. Choudhary (Judicial Member) and Mr. Sanjiv Srivastava (Technical Member) observed that a customs broker’s duty is limited to filing documents as per the details provided by the importer. “There is no case for alleging anything against the appellant. He is not an investigating agency or customs officer tasked with determining the correctness of documents produced for filing,” the order noted.
The tribunal clarified that assessment under Section 14 of the Customs Act is based on the transaction value reflected in the importer’s invoices. Any suppression of value by the importer is a matter for customs investigation, not for brokers to detect. The tribunal also dismissed arguments about violations of the Customs Broker Licensing Regulations (CBLR), stating that any such contraventions should be addressed through proceedings under the CBLR, not via penalties under Section 112(a).
Setting aside the penalties, the tribunal concluded that the customs broker had acted in accordance with the law and could not be faulted for the importer’s mis-declaration.
The appeal was thus allowed, bringing relief to the customs brokerage community concerned about being unduly penalised for importer infractions.
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