Tribunal Upholds Revocation of Customs Broker Licence for Breach of Regulations

Anax Air Services Pvt. Limited penalized for unauthorized sub-letting and failure to verify exporter details

In a significant judgment delivered by the Customs Excise and Service Tax Appellate Tribunal, Principal Bench, New Delhi, the appeal of M/s Anax Air Services Pvt. Limited was dismissed, thereby upholding the revocation of its Customs Broker Licence, forfeiture of security deposit, and imposition of a penalty of Rs. 50,000. The tribunal, presided over by Mr. Justice Dilip Gupta and Mr. P.V. Subba Rao, found the appellant guilty of violating multiple provisions under the Customs Brokers Licensing Regulations (CBLR), 2018.

The case arose when M/s Anax Air Services Pvt. Limited filed shipping bills for exporting goods purportedly on behalf of Shivam Enterprises. However, upon inspection, it was discovered that prohibited goods, onions, were being exported under the guise of mangoes and pomegranates. The tribunal noted that the appellant had acted upon the instructions of a third party, Shri Raviraj Sinh Jadeja, without obtaining authorization from the declared exporter, Shivam Enterprises.

The inquiry revealed that the appellant had contravened several regulations, including sub-letting its licence for monetary gains, failing to verify the identity and functioning of the exporter, and filing benami shipping bills. These actions were deemed a serious threat to national security and revenue, leading to the upholding of the revocation and penalties as proportionate to the offences committed.

The tribunal, referencing previous judgments, emphasized the critical role of customs brokers in ensuring compliance with national security and revenue protection. It stated that sub-letting of a customs broker licence poses a grave risk, as it could facilitate the export or import of contraband, including arms and ammunition, under false pretenses.

The judgment underscores the importance of strict adherence to the Customs Brokers Licensing Regulations, highlighting the responsibilities of customs brokers to verify client identities and obtain proper authorizations to prevent misuse of their licences.

Bottom Line:

Customs Brokers Licensing Regulations (CBLR) - Revocation of Customs Broker Licence due to violation of CBLR, 2018 provisions, including unauthorized sub-letting of licence, failure to obtain authorization from exporter, lack of due diligence, and non-verification of client details, upheld as proportionate to the offences committed.

Statutory provision(s): Customs Brokers Licensing Regulations, 2018 Regulations 1(4), 10(a), 10(d), 10(e), 10(n), Regulation 14, Regulation 17(7), Regulation 18

M/s Anax Air Services Pvt. Limited v. Commissioner of Customs, New Delhi, (CESTAT)(New Delhi)(Principal Bench) : Law Finder Doc Id # 2822332