Order Date – 28 February 2023

Parties: M/s. Svarad Logistics (India) Pvt. Ltd. VS Principal Commissioner of Customs.

Facts –

• The Appellant, M/s. Svarad Logistics (India) Pvt. Ltd., engaged in the business of ladies synthetic footwear and ladies footwear. The Appellant filed 6 shipping bills all dated 19.3.2019 on behalf of three exporters. On examination of goods at the time of export by customs, it was alleged that the exporter had overvalued the goods in order to claim excess export benefits.
• A penalty was imposed on the appellant under Regulation 17(7) of the custom broker Licensing Regulations, 2018 as the adjudicating authority was of the view that KYC verification was not done in a proper manner and hence they had erred in their duty. 
• The appeal is filed against order dated 26.2.2021 passed by the respondent imposing a penalty of Rs 20,000/- on the appellant.

Issue –

• Whether the appellant is liable for the penalty?

Order –

• The Tribunal in the light of the APS Freight & Travels Pvt. Ltd. Vs. Commissioner of Customs (General), New Delhi and Thawerdas Wadhoomal Vs. Commissioner of Customs (General), Mumbai, held that once the importer’s details as available in the IEC, PAN card, GST documents etc. have been checked by the appellant, no physical verification of importer’s premises is mandated in the Regulation nor is it a general requirement as per the business practice.
• Since the appellant had verified the relevant documents possessed by the exporter. There is no failure in this regard on their part and the penalty imposed on them under the CBLR and is not sustainable.
• For the reasons stated above, the appellant has not violated the provisions of Regulations 11(n) of custom broker Licensing Regulations, 2018 and there was no justifiable reason to impose a penalty on the appellant.
• Hence the appeal is allowed.