Customs Brokers must exercise due diligence and cannot solely rely on client declarations; repeated violations warrant suspension of license.

Per Mr. VASA SESHAGIRI RAO

This is an appeal filed by M/s. V Unit, Chennai (hereinafter referred to as the Appellant) to assail the Order No. 11/2025 dated 01.07.2025 (impugned order) passed by the Commissioner of Customs (General), Chennai Customs Zone, Chennai (hereinafter referred to as the Respondent).

2. The Appellant was issued Customs Broker Licence No. R-538/2019-CBS by Commissioner of Customs, Chennai under Regulation 7(2)(b) of Customs Broker Licensing Regulations, 2018 (hereinafter referred to as CBLR).

3. Vide Order No. 23/2025 dated 12.06.2025, the licence of the Appellant was suspended by the Respondent upon receipt of offence report in the form of Order-in- Original against the Appellant in following two different cases: -

i. Order-in-Original No. 104579/2023 dated 07.02.2024 which was received by the Respondent on 28.04.2025 from Import Commissionerate, Chennai Customs Zone, wherein the Adjudicating Authority has imposed a penalty of Rs. 2,00,000/- (Rupees Two Lakhs only) under Section 117 of the Customs Act, 1962 on Shri M. Vinoth, partner in the Appellant firm.

ii. Order-in-Original No. 106410/2024 dated 24.04.2024 which was received by the Respondent on 16.05.2025 from Import Commissionerate, Chennai Customs Zone, wherein the Adjudicating Authority has imposed a penalty of Rs. 10,00,000/- (Rupees Ten Lakhs only) under Section 114AA of the Customs Act, 1962 on Shri M. Vinoth, partner in the Appellant firm.

4. The role of Appellant in the First Case (O-in-O No. 104579/2023 dated 07.02.2024) has been detailed out by the Respondent in paras 4.1 and 4.2 of the order of suspension dated 12.06.2025 as follows: -

“4.1 It appears from depositions of Shri M. Vinoth, partner of M/s. V Unit, Chennai (CB) that CB generate check-list for filing bills of entry and after approval of the importer, he files bill of entry with customs; he had been associated with Shri Anwar Sadath and Shri Moosa and in earlier occasions also cleared consignments of ‘Areca Nuts in split form’ by declaring the same as “ UNFLAVOURED SUPARI (BETEL NUT PRODUCT)”; that as per the instructions of Shri Moosa, Manager and Shri Anwar Sadath, owner of M/s. Surya Oil Exporters, he filed bills of entry by mentioning description of the imported product wrongly as ‘Inflavoured Supari (Betel NUT Product), so as to avail the facility of exemption under Notification NO.50/2017-CUs (Sl.No.103); that he admitted that the imported product under the previous 5 bills of entry was ‘Areca Nut in split form’ without any processing and any additives or ingredients; and that he has gone through the Mahazar dated 05.04.2022 drawn at ECCT CFS, Chennai and agreed with the contents recorded therein and also admitted that as per the photographs taken at the time of mahazar proceedings dated 05.04.2022, the imported products were nothing but ‘Areca Nut in split form’ and appear to be not processed and did not contain any additives and ingredients.

4.2 Thus, it appears from the above that Shri M Vinoth, partner of M/s. V Unit, Chennai (CB) knowingly and intentionally caused M/S SURYA OIL EXPORTERS to file bills of entry with wrong description and classification of imported goods, abetted and facilitated M/S SURYA OIL EXPORTERS to fraudulently avail the benefit of Notification No.50/2017-Cus dated 30.06.2017 ( Sl.No.103) and to evade payment of appropriate customs duty and also to circumvent the prohibition imposed by the Government of India on the import of Areca Nuts below the specific value, as per the Directorate of Foreign Trade (DGFT) Notification No.20/2015-2020 dated 25.07.2018. Thereby it appears that the CB i.e M/s V-Unit, Chennai being in the business of Customs Broker, have not caused any verification of the actual description of imported goods and its correct classification under Customs Tariff Act, 1975 and not exercised due diligence in ascertaining the classification details while representing M/S SURYA OI