By TIOL News Service

MUMBAI, JULY 16, 2014: THIS is a Revenue appeal.

The Commissioner of Customs (General), Mumbai had dropped the proceedings initiated against the CHAby rejecting the findings of the inquiry officer.

The brief facts are - An inquiry was initiated against the CHA with regard to their involvement in evasion of Customs duty on the import of electrical and electronic goods of foreign origin. The investigation revealed that the said CHA had filed Bill of Entry and had failed to give factual description, brand and country of origin. Further, the value of goods were declared as Rs.10,03,690/- whereas on physical verification, the value was found to be Rs.77,10,000/-. The CHA had admitted to attending the clearance work in respect of the said consignment and also admitted to introducing the importer to the overseas suppliers and bankers for financial assistance. They had also admitted to misdeclaring the value.

Accordingly, a charge sheet was issued to the appellant CHA under CHALR, 1984.The adjudicating authority observed that the proceedings against CHA had been initiated solely on account of alleged involvement in the clearance of one container in 2001 and except for the initial statement of the importer against the CHA, no other evidence is available. He, therefore, dropped the proceedings initiated against the CHA for revocation of the CHA licence.

Revenue is in appeal before the CESTAT.

It is urged that the Commissioner had overlooked the statement of Shri Vijay Thakkar , Proprietor of the CHA firm wherein he had admitted to misdeclaration of the goods under import in connivance with the importer; that although the said statement was retracted subsequently, since there is corroboration in the physical examination of the goods which showed that there was misdeclaration of value, the initial confessional statement ought to have been considered and the CHA should have been held guilty of the charges of contravention of Regulations 14(d), 14(f) and 14(i) of the CHALR, 1984.

The respondent submitted that the Revenue appeal is not maintainable for the reason that -

+ Under Regulation 23 of the CHALR, 1984, there is no provision enabling the department to file an appeal against the order of the Commissioner dropping charges against the CHA.

+ Under Regulation 23 (8), only a CHA aggrieved by any decision or order passed under Regulation 21 or sub-regulation (7) of Regulation 23, may appeal under Section 129A of the Customs Act, 1962, to the CESTAT.

+ There is no provision for filing of an appeal by the Revenue under CHALR.

+ Moreover, the Revenue appeal is filed under Section 129D of the Customs Act, 1962 and in terms of which the Committee of Chief Commissioners can direct the Commissioner to file an appeal only against an order passed by the Commissioner “under the Act”.

+ Inasmuch as since the order dropping the charges against the CHA is not an order made under the Customs Act but under the CHALR, the appeal of the Revenue is not maintainable.

The Bench agreed with the submissions made by the respondent and dismissed the Revenue appeal as being not maintainable.