Customs Tribunal Vindicates Silver Line Global Freight: License Restored

CESTAT New Delhi Principal Bench Overturns Revocation of Customs Broker License for Alleged Mis-declaration

In a significant ruling, the Customs Excise and Service Tax Appellate Tribunal (CESTAT) in New Delhi has overturned the decision to revoke the Customs Broker License of M/s Silver Line Global Freight Pvt Ltd. The tribunal’s decision, dated December 8, 2025, reinstates the license, setting aside the Commissioner of Customs’ earlier order that had also imposed a penalty and forfeited the security deposit.

The controversy began when the Customs Broker was accused of failing to comply with several obligations under the Customs Brokers Licensing Regulations, 2018, particularly Regulations 10(a), 10(d), 10(e), and 10(n). These allegations arose after discrepancies were found in the shipping bills filed on behalf of M/s Felicity International, an exporter. The goods, declared as "Mens knitted hoody with zip made of blended cotton and MMF," were found to be "100% polyester," and the declared value was significantly higher than market estimates.

Despite these allegations, the tribunal found that the Customs Broker had acted on authentic government-issued documents and that there was no evidence of collusion or negligence. The Tribunal observed that the Customs Broker is not responsible for physically verifying the premises of the exporter and is entitled to rely on documents such as the Importer Exporter Code (IEC), GSTIN, and PAN, which were found to be authentic.

The tribunal's judgment emphasized that the Customs Broker had indeed obtained authorization from the exporter prior to filing the shipping bills, as evidenced by the presented documents. The tribunal also noted that the inability of the SIIB officers to find the authorization did not prove its non-existence at the relevant time.

Furthermore, the tribunal dismissed the allegations of negligence and non-compliance with Regulations 10(d) and 10(e), asserting that the Customs Broker had no authority to examine goods or determine their value, thus could not be held accountable for the mis-declaration by the exporter. The tribunal criticized the logic of the allegations, emphasizing that the mere occurrence of mis-declaration does not automatically imply the Customs Broker's failure to advise compliance.

The tribunal's decision to restore the Customs Broker's license and negate the imposed penalty and forfeiture of the security deposit underscores the importance of evidence-based judgments and adherence to procedural norms in licensing matters.

Bottom Line:

Customs Broker cannot be held liable for mis-declaration by the exporter when due diligence has been exercised as per the documents provided by the Government authorities.

Statutory provision(s): Customs Brokers Licensing Regulations, 2018, Regulations 10(a), 10(d), 10(e), 10(n)

M/s Silver Line Global Freight Pvt Ltd v. Commissioner of Customs (Airport & General), (CESTAT)(New Delhi Principal Bench) : Law Finder Doc Id # 2819763