Date of order: 17 October 2022

Facts:

• The Appellant, M/S PURUSHOTTAM KUMAR JAIN, is the Customs House Agent who was engaged in importing rough precious stones.
• On 16.10.2018 at the office of the appellant being the Customs Broker for M/s. Rishipushp Trading LLP for the import of the impugned consignment. Premises of the partners (Shri Hemant Kumar Bhambi and Shri Rajendra Byawat) of the importers were also searched on 17.10.2018. Their statements also got recorded.
• Revenue submitted that M/s. Rishipushp Trading LLP for the impugned import by declaring the overvalue of Rs.1,93,68,833.75 instead of its actual value of Rs.9,47,510/-. As such, he was alleged to have abetted the act which has rendered the seized rough precious stones ‘Sapphire’ liable to confiscation and himself liable for penalties under the Customs Act.
• The department observed that he as Customs Broker of the importing firm has failed to fulfill its obligation and had deliberately / knowingly ignored the fact that the importer is not the actual importer and the importer is the one who is not the IEC holder. 
• With these observations, show cause notice No. 02/2019 dated 23.08.2019 was served not only upon the importing firm and its partners but also upon the appellant proposing the imposition of penalty under section 112 (a) &(b) (iii) and under section 114A of the Customs Act, 1962. The said proposal was initially confirmed vide the Order-in Original.

Issue:

• Whether the appellant is entitled for the penalty?

Order

• The Tribunal observed that there is no dispute that the importer in the present case is M/s.Rishipushp Trading LLP and that the firm is an importer exporter code (IEC) holder. The copy of IEC code is very much on record.
• It was observed that penalty upon the appellant has been confirmed on the sole ground that the importer on record i.e. M/s.Rishipushp  Trading LLP is not the actual importer.   The actual importer is presumed to be Shri Pukhraj Ramdevji Padiyar and since Shri Pukhraj Ramdevji Padiyar  is not IEC code holder and since this fact was known to the appellant, he deliberately ignored the same, thereby committing violation of his obligation as Customs Broker. The above observed and un-disputed facts are opined sufficient to falsify the findings that the importer is someone else other than M/s.Rishipushp Trading LLP. The firm is holder of valid IEC. There is no dispute about their valid KYC documents. There is nothing on record that Shri Pukhraj R Padiyar was the actual importer. He rather the authorized by the firm (LLP) to deal with the Customs Broker for facilitating the importing firm to get the imported consignment.   
• Thus it was held that findings are held as  nothing but the outcome of Department’s own presumptions and assumptions, as far as the obligations of Customs Broker on part of appellant are concerned. Hence, it stands apparently clear that the appellant has deliberately and intentionally has not provided any such information which was false or incorrect.   As such, in my opinion that penalty under section 114AA  of the Customs Act, 1962 has wrongly been imposed upon him.