The judgment establishes the principle that a Customs House Agent must adhere to the obligations and responsibilities outlined in the licensing regulations, and the imposition of penalties must be proportionate to the violations.

JUDGMENT

T.S.Sivagnanam, J. - This appeal filed by the Revenue under Section 130 of the Customs Act, 1962 (the Act), is directed against the order dated March 29, 2017 passed by the Customs Excise and Service Tax Appellate Tribunal, Eastern Zonal Bench, Kolkata (Tribunal) in order No. F/075901/2017 in Appeal No. C/194/2012- DB, arising out of order-in-original dated April 13, 2012, passed by the Commissioner of Customs (Airport & Admin.), Kolkata under Regulation 22(7) of the Customs House Agents Licensing Regulations, 2004 (CHALR).

The appeal was admitted on November 26, 2018 on the following questions of law:

(i) Whether the impugned order of the Tribunal can be called perverse for the reason that on the ground the respondent was exonerated from penalty in the proceeding under Section 124 of the Customs Act, 1962, the Tribunal set aside the order revoking their license?

(ii) Whether the Tribunal ought to have done so when the charge against the agent was serious i.e. not advising the customs properly under the regulations with regard to the mis-declaration of the description of the goods by the exporter?

2. The respondent was granted Customs House Agents License during 1997 under the erstwhile Customs House Agents Licensing Regulations, 1984 to transact customs clearance work within the jurisdiction of Kolkata Customs Commissionerate. The respondent came to adverse notice of the Department pursuant to an investigation done by the Directorate of Revenue Intelligence, Kolkata Zonal Unit (DRI), who had received information that Red Sanders wood which is a prohibited item, is attempted to be illegally exported under the guise of ductile iron casting from an exporter of Burdwan through Haldia Port. This investigation culminated in issuance of show-cause notice under Section 124 of the Act dated 25.02.2010. The respondent was the 5th noticee in the said notice. The respondent was called upon to show cause as to why penalty should not be imposed on them under Section 114(i) of the Act on the alleged ground that the respondent for material gain assisted in the attempt of illicit export of Red Sanders and thus, had failed to discharge their responsibilities properly/ legally in dealing with the subject goods. Further, they had handled the consignments without getting any authorization letter from the declared exporters and they had failed to advise their clients to comply with the provisions of the Act and did not bring the matter to the notice of the Customs Authorities and all these tantamounts to not exhibiting their proper role as CHA. The competent authority under CHALR was requested to take suitable action in terms of the Regulations for not complying with the obligations laid down in Regulation 13 of the CHALR. Further, it appears that the respondent has rendered themselves liable for penal action under Section 114(i) of the Act for the aforesaid omission and commission. The appellant submitted their explanation on March 16, 2010 stating that they received the job order from M/s. Suman International and they were aware that M/s. Suman International had secured the job order from M/s. Liner Shipping Agency (P.) Ltd. and M/s. Suman International is also a CHA and since their license has been temporarily suspended, they approached the respondent for carrying out the said job order.

Further, the respondent referred to the statement recorded from the proprietor under Section 108 of the Act wherein they had stated that they entrusted the job order to their employee Mr. Samrat Basu who got the documents from M/s. Suman International and on the basis of such documents, he prepared the shipping bills and other documents necessary for export of the goods. Further, it was stated that Mr. Samrat Basu was not aware of the contents of the containers. It was further stated that CHA did not know about the contents of the containers in as much as the containers were not packed in their presence and the containers have been brought by the export pers