Customs Brokers must exercise due diligence but are not liable for post-import violations by clients outside their knowledge.

PER : M.M. PARTHIBAN

Thise appeal has been filed by M/s Aggressive Shipping & Logistics Private Limited, Mumbai (herein after, referred to as ‘the appellants’ for short) assailing the Order-in-Original CAO No. 130/CAC/PCC(G)/SJ/CBS-Adj dated 27.01.2022 (referred to as ‘the impugned order’) passed by learned Principal Commissioner of Customs (General), New Custom House, Ballard Estate, Mumbai-I.

2.1. Briefly stated, the facts of the case are that the appellants herein is a Customs Broker (CB) holding a regular CB license No. 11/2159 issued by the Mumbai Customs under Regulation 7(1)/7(2) of Customs Brokers Licensing Regulations ( CBLR ), 2013/2018. An offence report was received consequent to receipt of intelligence by Directorate of Revenue Intelligence, Sub-Regional Unit, Vapi and resultant search operations conducted by them along with other field formations about mis-utilization of Advance Authorization Scheme by certain importers viz., M/s Ramniklal & Sons, Mumbai along with their supportive manufacturers, whose consignments were cleared by appellants CB by filing Bills of Entry (B/Es) No. 2589579 dated 25.07.2017; B/E Nos. 2664083 & 2664086 both dated 31.07.2017 and B/E No.2801230 dated 10.08.2027.

2.2. On the basis of such offence report received from DRI, the jurisdictional Principal Commissioner of Customs (General), Mumbai-I had concluded that there is a prima facie case against the appellants for having contravened Regulations 10(a), 10(d), 10(e), 10(m) and 10(n) of CBLR , 2018 [earlier Regulations 11(a), 11(d), 11(e), 11(m) and 11(n) of , 2013]. Accordingly, he had immediately suspended the CB license of the appellants under Regulation 16(1) ibid, vide Order No. 45/2020-21 dated 26.02.2021; and such suspension was continued vide Order No. 08/2022-23 dated 11.05.2022 pending conduct of regular inquiry proceedings; further the department had initiated show cause proceedings by issue of notice No. 08/ 2021-22 dated 21.05.2021 for initiating inquiry proceedings under Regulation 17 ibid, in respect of violations of as mentioned above. Accordingly, Show Cause Notice (SCN) No.11/2021-22 dated 11.06.2021 was issued against the appellants on the aforesaid charges of violation of , 2018 and an Inquiry Officer was appointed.

2.3. Upon completion of the inquiry proceedings, an inquiry report dated 13.09.2021 was submitted concluding that all charges for violations against sub-regulations 11(a), 11(d), 11(e), 11(m) and 11(n) of CBLR , 2013 framed against the appellants CB have been proved. After perusal of the appellants’ written submission dated 12.03.2021 and upon providing a personal hearing through virtual mode on 14.12.2021, the Principal Commissioner of Customs (General), Mumbai, being the licensing authority had passed the impugned order dated 25.11.2022 under Regulations 17(7) and 18 ibid, for revoking CB License of the appellants and for forfeiture of entire amount of security deposit, besides imposition of penalty of Rs.50,000/- on the appellants and asking them to surrender the original CB license issued to them along with all ‘F’, ‘G’ and ‘H’ identity cards issued to them. Feeling aggrieved with the impugned order, the appellants have preferred this appeal before the Tribunal.

3.1 Learned Advocate for the appellants contends that all the allegations of violation of Regulations 11(a), 11(d), 11(e), 11(m) and 11(n) of CBLR , 2013 have been countered by them. In respect of obtaining written authorisation from the importer, he stated that the appellants CB did not doubt the genuineness of importer as he was a DEEC license holder; in respect of alleged violation against Regulation 11(d), ibid, they claimed that all their clients are regularly advised to comply with the customs laws and regulations, and the