Penalty under Section 112(a) of the Customs Act, 1962, cannot be imposed on a Customs House Agent (CHA) without evidence of their knowledge of the concealment of goods or the initiation of proceedings under the Customs Broker Licensing Regulations, 2013.

S. S. GARG

The Present appeal is directed against the impugned order dated 25.07.2012 passed by the Commissioner of Customs, Kandla whereby the Learned Commissioner has imposed the penalty of Rs. 1 Lakh on the appellant under Section 112(a) of the Customs Act, 1962.

Briefly the facts of the present case are that M/s. Rodex International having importer-Exporter code Number 3710001358 was a partnership concern engaged in trading activities of various types of items for which Development Commissioner, Kandla Special Economic Zone, had issued Letter of approval No KASEZ.IA/1880/2002-03/1907, dated 08.05.2002. Intelligence was gathered by the officers of Directorate of Revenue Intelligence, Zonal Unit, Ahmedabad (DRI) that certain goods were to be smuggled in a container bearing number GLDU-0279344 surreptitiously by concealing them in the goods imported in the name of Rodex. Hence, the officers of DRI kept surveillance and found that Rodex had filed bill of Entry No.0001296 dated 02.02.2011 before the Customs authorities KASEZ, Gandhidham, for the import of 73 packages of Refrigerators, LCD/Plasma TVs in container number GLDU-0279344.

On reasonable belief that the consignment covered under the said earlier Bill of Entry might be containing smuggled/mis-declared goods, the same were subject to examination and the Officers of DRI carried out examination and found that the said container was stacked with packages of Panasonic Refrigerators, Sony LCD TVs & Panasonic Plasma Tvs. The Officers recovered four black coloured polyethylene bags which were concealed in the back side of four refrigerators and opened and found 28580 pieces of ‘Micro’ Brand SD Memory Cards of 2 GB. The said Memory Cards were not declared in the Bill of Entry filed by Rodex.

After the thorough investigation, a show cause notice dated 07.07.2011 was issued by the Commissioner of Customs, Kandla and after following the due process, the same was adjudicated and penalties on different persons as mentioned in the impugned order was imposed including a penalty of Rs. 1 Lakh on the present appellant which he has challenged by filing the present appeal.

Heard both sides and perused the material on record.

Learned Counsel appearing on behalf of the appellant submits that the impugned order is not sustainable in law as the same has been passed without properly appreciating the facts and the law and binding judicial precedents. He further submits that in the impugned order passed by the Commissioner, it has been specifically mentioned by the Learned Commissioner that the appellant who is acting as a CHA has only assisted M/s. Rodex International in preparation of the document but the Bill of Entry was filed on SELF basis by Rodex. He further submits that it has also been recorded in the impugned order that the main person behind the import was Lilaram Arjandas Asudani who was in touch with the present appellant and the present appellant was getting some consideration from him. He further submits that the Customs has failed to prove any material evidence on record to show that appellant had the knowledge above the concealment of Memory Chip Cards in the imported items. He further submits that the penalty has been imposed without establishing any proof of knowledge of concealment of Memory Cards. Learned Counsel has relied upon the following judgments to show that without the corroborative evidence pinpointing the involvement of the CHA, Penalty under Section 112 (a) cannot be imposed. Reliance is placed on following judgments:-

 2021 (378) ELT 528 (Tri-Bang.)

 2008 (222) ELT 137 (Tr9-Ahd.)

 2004 (171) ELT 72 (Tri-chennai)

 2004 (165) ELT 97 (Tri-Chennai)

 2003 (159) ELT 260 (Tri-Kolkata)

 2002 (145) ELT 83 (Tri-Kolkata)

He further submits that the penalties imposed on the main culprit i.e. Lilaram Arjandas Asudani has already been set aside by this Tribunal vide its Final Order No. 12974-12975/2024 dated 03.12.2024. He also submits relied upo