Decided on October 07,2015

Dakor Clearing And Shipping P. Ltd. Appellant
Commr. Of Cus. (General), Mumbai Respondents


ANIL CHOUDHARY,MEMBER (J) - (1.)This is an appeal filed by the appellant, M/s. Dakor Clearing & Shipping Pvt. Ltd., against Order -in -Original No. 114/CAC/CC(G)/SRP/CBS (Admn.), dated 19 -11 -2014 passed by the Commissioner of Customs (General), Mumbai whereby the CHA licence of the appellant has been revoked. The brief facts of the case are that the appellant is holder of the CHA Licence No. 11/954. They have been granted CHA License under Regulation 10(1) of the CHALR, 1984 read with Regulation 9(1) of CHALR, 2004 read with Regulation 7(1) of CBLR, 2013 in Mumbai Customs.
1.1 A specific intelligence was received in the Directorate of Revenue Intelligence (DRI), that one Salim Lalani operating in the name of M/s. Mahek Consultancy Services was engaged in the large scale import clearances of miscellaneous goods by using various CHA licenses. Accordingly, the office premises of M/s. Mahek Consultancy Services were searched under panchanama dated 20 -11 -2008 and certain files, register, documents and Indian currency of Rs. 1,30,000/ - were recovered. The documents showed that the clearances were also effected using the CHA license of M/s. Dakor Clearing & Shipping Pvt. Ltd. (appellant).

1.2 The premises of the present appellant were inspected on 21 -11 -2008 and the dockets pertaining to M/s. Mahek Consultancy Services were taken over under summons and the live consignments of the CHA were put on hold for further investigation. In the meantime, the Bills of Entry filed for the import consignments by the appellant CHA - M/s. Dakor Clearing & Shipping Pvt. Ltd. were kept on hold to avoid the unauthorized sub -agents from clearing the goods, under these Bills of Entry.

1.3 Statement of Shri Salim S Lalani, the proprietor of M/s. Mahek Consultancy Services was recorded on 24 -11 -2008 under Sec. 108 of the Customs Act, wherein he stated that he did not have the CHA license; that he met Shri Nimesh Joshi, Managing Director of M/s. Dakor Clearing & Shipping Pvt. Ltd. and requested him to allow him to clear the import consignments of his clients by using his name and CHA license; that Shri Nimesh Joshi agreed to lend him the name and license of his CHA company and it was agreed that M/s. Dakor Clearing & Shipping Pvt. Ltd. would raise a bill directly in the name of his clients; that the CHA firm issued Customs Pass and BPT pass in the name of his brother Shiraz Lalani and Vinod Manjrekar showing them as their employees; that the role of the CHA was restricted to signing documents and all the work relating to the clearance of consignment was looked after by employees of M/s. Mahek Consultancy Services; that he had filed around 25 Bills of Entry using the name and license of appellant -CHA firm.

1.4 Further, statement of Shri Nimesh J. Joshi, Managing Director of the CHA firm was also recorded on 21 -11 -2008 under Sec. 108 of the Customs Act, wherein he stated that Salim Lalani had visited his office with the proposal of handling clearances of import of consumer goods from China; that Shri Salim asked him to clear the consignments through the CHA firm and agreed to pay Rs. 10,000/ - to Rs. 12,000/ - per job; that he allowed Salim Lalani to clear the goods for their clients under his CHA firm; that Salim brought 24 jobs of clearance of import consignments of various importers during the period 28 -9 -2008 to 4 -10 -2008; that since they filed the documents with the Customs online, Salim Lalani had given him documents like authorization, invoice, packing list, Bill of Lading, IEC code and GATT declaration of the respective importer; that the follow up and clearance related work like group passing, examination and delivery were handled by Salim Lalani through his persons namely, Vinod Manjrekar, Siraj Lalani and Feroz Lalani; that he did not interact with the individual importer/party whose jobs for clearance was brought by Salim Lalani; that he was aware that 9 of the IEC holders namely M/s. Carol Enterprises, M/s. Catelite Enterprises, M/s. Fedex Traders, M/s. Atlas Impex, M/s. ASR Enterprises, M/s. Mansoor Arts, M/s. Flex Overseas, M/s. Shivam Traders and M/s. Manj International in whose name the above goods were imported, were fake.

1.5 In view of the above, it appeared to the Revenue that appellant/CHA firm has contravened the provisions of Regulations of the CHALR, 2004. Therefore, the CHA License No. 11/954 was placed under suspension vide Order No. 141/2009, dated 6 -3 -2009 under the provisions of Regulation 20(2) of CHALR, 2004 for suspected violation of Regulations of CHALR, 2004 and inquiry proceedings were initiated under Regulations 22 of CHALR, 2004 vide notice dated 8 -6 -2009. On the basis of the relied upon documents, the following Articles of Charges were framed against the CHA vide Notice dated 8 -6 -2009: -

Article of Charge - I: As per Regulation 12 of the CHALR, 2004 'every license granted or renewed under these regulations shall be deemed to have been granted or renewed in favour of the licensee and no license shall be sold or otherwise transferred'.

Article of Charge - II: As per the provisions of Regulation 13(a) - 'A CHA shall obtain an authorization from each of the companies, firms or individuals by whom he is for the time being employed as CHA and produce such authorization whenever required by the Dy. Commissioner of Customs or the Assistant Commissioner of Customs.'

Article of Charge - III: As per Regulation 13(b) of the CHALR, 2004 - 'A CHA shall transact business in the Customs Station either personally or through an employee duly approved by the Dy. Commissioner of Customs or the Assistant Commissioner of Customs.'

Article Charge - IV: As per Regulation 13(d) of the CHALR, 2004 - 'A CHA shall advise his client to comply with the provisions of the Act and in case of non -compliance, shall bring the matter to the notice of the Dy. Commissioner of Customs or the Assistant Commissioner of Customs.'

Article Charge - V: As per Regulation 13(n) of the CHALR, 2004 - 'A CHA shall ensure that he discharge his duties as CHA with utmost speed and efficiency and without avoidable delay'.

Article Charge - VI: As per Regulation 19(8) of the CHALR, 2004 - 'A CHA shall exercise such supervisions as may be necessary to ensure the proper conduct of any such employees in the transaction of business as agents and be held responsible for all acts or omissions of his employees in regard to their employment.'

1.6 The Inquiry Officer submitted his inquiry report vide letter dated 8 -7 -2014 wherein he held all the six charges as 'not proved' against the CHA. The findings of the Inquiry Officer are as under: -

(i) The Inquiry Officer has stated that prima facie the Presenting Officer while making his submission that all the charges has been proved had squarely relied upon the confessional statement made by Shri Nimesh Jayantilal Joshi, MD of M/s. Dakor Clearing & Shipping Pvt. Ltd., Shri Salim Lalani, Shri Javed Lalani and Shri Vinod Manjerekar recorded under Sec. 108 of Customs Act, 1962 during the course of preliminary investigation conducted at the time of registering cases against certain importers by the officers of DRI, by taking the support of some case laws. The case laws referred to, no doubt speak that the confessional statements given voluntarily shall have evidential value. Against this version of the Presenting Officer, the charged CHA has contested that the persons concerned were neither examined nor cross -examined in the Enquiry proceedings, hence their statements shall not be taken into consideration. The inquiry officer has stated that he accepts the proposition made by the Presenting Officer regarding the validity and evidential value of confessional statement given voluntarily, at the same time, some weightage needs to be given to the version of the charged CHA that he was deprived of cross examining those persons whose statements were declared to be confessional. In this regard Inquiry Officer is of the opinion that it is required to be noticed that unless the persons concerned are examined and cross examined, it cannot be conclusively held whether the statements are voluntary or otherwise. Keeping aside this particular aspect of legal and technical nature, Inquiry Officer has further attempted to analyze the defense submission of the charged CHA with reference to the Article of Charges framed against them.

(ii) The Inquiry Officer has stated that the salient points that are urged by the charged CHA are as under: -

(a) It was stated that in his statement Shri Nimesh Joshi has deposed that he was aware that 9 IECs of 9 different firms were fake, which formed the basis for levelling charges against him. However there was no evidence established against the fake nature of the IECs. In as much as 2 persons have signed on authorization given to the CHA, one in the capacity of Proprietor and another in the capacity of partner, it was alleged the IECs were fake. However, their individual statements were not recorded nor relied upon, neither made available.

(b) The charge of transferring of licence is based on term used "lending of licence" as available in the relied upon statements of Shri Nimesh Joshi and Shri Salim Saddrudin Lalani. However the statements categorically speak out that the charged CHA has taken the assistance of Shri Lalani in developing business which does not amount to lending or transferring licence.

(c) While the Presenting Officer has squarely relied upon the statements of persons such as Shri Salim Saddrudin Lalani, Shri Javed Lalani and Shri Manjrekar and concluded that the statements are of confessional nature. However, it is to be noted from the status of the persons concerned, their educational qualifications etc., the language available in the statement is not in tune with the qualifications and status and gives an impression that the statements are not voluntary.

1.7 The Commissioner of Customs (General), vide the impugned order, held that the Inquiry Officer has miserably failed in bringing out the correct facts to the notice of the disciplinary authority, as the CHA has failed in performing their duties and committed various acts which display their lack of adherence to the CHALR, 2004 and are found to be culpable for violation of the impugned regulations of CHALR, 2004. He also held that the CHA deserves punishment proportionate to violations of various provisions of CHALR, 2004. Accordingly, in exercise of the powers conferred under Regulations 22(7) and 20(1) of the CHALR, 2004, the Commissioner ordered for revocation of the CHA License of the appellant, M/s. Dakor Clearing & Shipping Pvt. Ltd., with immediate effect and also ordered for the forfeiture of entire amount of Security Deposit.

1.8 Being aggrieved, the appellant -CHA is in appeal before this Tribunal.

(2.)The learned Counsel for the appellant submitted that on 4 -3 -2009, the CHA licence was suspended by an ex parte order by the respondent. The licence continued to remain under suspension and the charge -sheet under the Regulations came to be issued on 8 -6 -2009. Pursuant to the completion of the Inquiry, the Presenting Officer submitted a Brief Report dated 5 -2 -2013, copy received by the CHA on 24 -2 -2013. A reply was filed before the Inquiry Officer by written submission dated 16 -5 -2013. All the articles of charges were denied by the appellant CHA. By report dated 8 -7 -2014, the Inquiry Officer filed his report and held that none of the Articles of Charges have been proved. The Commissioner issued a "Disagreement Memo on 4 -8 -2014" and thereafter by Written Submissions dated 1 -9 -2014 and 29 -9 -2014, the appellant CHA filed a detailed rebuttal/reply to the Disagreement Memo. The respondent Commissioner by Final Order dated 19 -11 -2014 held that all the articles of charges stood proved against the CHA and permanently revoked the CHA licence and also ordered for forfeiture of the entire amount of Security Deposit.
2.1 The learned Counsel further submitted that the Commissioner has not brought on record any fresh evidence to factually disprove/upset the findings of the Inquiry Officer, who had dropped the Articles of charges, being the initial fact finding authority.

2.2 The Commissioner also did not appreciate that the appellant/CHA has suffered enough punishment, as an alternative submission, as the CHA licence has remained inoperative/suspended for approximately 6 years, from the date of suspension i.e. 4 -3 -2009. Reliance is placed on the judgments of the Hon'ble Madras High Court reported in : 2014 (309) E.L.T. 433 in the case of A.M. Ahmed & Company and Ashiana Cargo Services, reported in : 2014 (302) E.L.T. 161. This Tribunal in the case of Adarsh Clearing Agency has set aside the revocation of the CHA license following the earlier precedents on the same principle of law of "enough and sufficient punishment". Reliance is also placed on the Order No. A/1750/2014/CSTB/C -I, dated 19 -11 -2014 [2015 (327) E.L.T. 730 (Tribunal)] of this Tribunal passed in the case of Jai Ambe Logistics, following the same principle and in the case of Manilal Patel Clearing Forwarding Pvt. Ltd. reported in : 2013 (294) E.L.T. 472, wherein this Tribunal followed its earlier decisions and withdrew the revocation order on the ground of sufficient punishment already undergone. In Manilal Patel's case the enquiry officer had dropped the articles of charges and the notice was not issued under the CHALR within 90 days from receipt of the offence report. Recently the Commissioner in the case of Daroowala Brothers and Company has passed an adjudication order dated 18 -7 -2014, following the same principle of law.

2.3 The appellant also relied on the ruling of Hon'ble Madras High Court in the case of Commissioner of Customs, Chennai v/s. CESTAT, Chennai reported in : 2014 (310) E.L.T. 673 (Mad.), the Division Bench of the Hon'ble Madras High Court has inter alia held that there has to be strict compliance of time -limit to complete the inquiry under the CHALR, which is to be completed within the stipulated period of 9 months from the date of Offence Report. The CHA inquiry has not been completed within the stipulated time -limit and on this ground also the impugned order requires to be set aside. The appellant therefore, prays that since the impugned order is passed after almost 6 years from the date of suspension order i.e. on 19 -11 -2014, whereas the suspension order was passed on 4 -3 -2009, the fundamental right to do business has been restricted for this entire period, and the case is not falling under the category of the rarest of the rare cases or serious moral turpitude, which would entail revocation of the CHA licence, this Tribunal may extend it's mercy on the appellant CHA.

(3.)The learned AR appearing for the Revenue relies on the impugned order.

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