The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has observed that Customs Broker under Regulation 10(n) does not include keeping a continuous surveillance on the client to ensure that he continues to operate from that address and has not changed his operations.
The bench of Justice Dilip Gupta (President) and P. V. Subba Rao, (Technical Member) has observed that once verification of the address is complete, if the client moves to a new premises and does not inform the authorities or does not get his documents amended, such act or omission of the client cannot be held against the Customs Broker.
The appellant had a Customs Broker licence valid up to 05.06.2024 issued by the Commissioner of Customs (Airport & General), New Delhi. A communication was received by the Commissioner from the Joint Director, Directorate General of Analytics and Risk Management, New Delhi that DGARM had conducted an analysis of the data of the GST registrants and identified risky exporters who may have been involved in IGST refund frauds.
DGARM also identified the Customs Brokers who handled exports of such exporters including the appellant. DGRAM got the existence of some of these exporters verified from field formation and found that they were not existence.
Based on the analysis, DGARM wrote to the concerned commissioners including the respondent herein to take action under the Customs Broker Licensing Regulations.
A show cause notice was issued by the respondent which culminated in the order.
The customs broker contended that Regulation 10(n) mandates the Customs Broker to verify the identity of the importer by way of independent documentation and the appellant ad done so. All the documents which were collected from the exporters at the time of processing of shipping bills were submitted during the adjudication proceedings. The only thing against the appellant is a report by DGARM that the exporters were found to be non- existent which is not on the basis of any evidence.
The customs broker contended that even if the exporter was found non-existent at the address, the appellant had verified their existence on the basis of the documents issued by the Government Office and he cannot be held accused of violation Regulation 10(n).
The tribunal held that the appellant Customs Broker did not fail in discharging its responsibilities under Regulation 10(n). The order is not correct in concluding that the Customs Broker has violated Regulation 10(n) because the exporter was found to not exist during subsequent verification by the officers.
Case Details
Case Title: M/S Akanksha Global Logistics Pvt Ltd Versus Commissioner, Customs-New Delhi
Case No.: Customs Appeal No. 51269 Of 2023
Date: 07/03/2025
Counsel For Appellant: G. S. Arora
Counsel For Respondent: Girijesh Kumar
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