Sai Seair Logistics Private Limited Vs Principal Commissioner of Customs (CESTAT Ahmedabad)
Summary: The appeal was filed by M/s. Sai Seair Logistics Private Limited against the Order-in-Original dated 26.03.2026 passed by the Principal Commissioner of Customs, Ahmedabad, whereby the Customs Broker Licence bearing No. CHA/ABD/R/01/2016-17 was revoked under Regulation 14 read with Regulation 17 of the Customs Brokers Licensing Regulations, 2018 (CBLR, 2018). The security deposit was also ordered to be forfeited and a penalty of Rs. 50,000/- was imposed on Shri Shaileshkumar Karmakar, F-Card holder of the appellant.
The appellant had assisted M/s. Design Decode in filing Bills of Entry dated 06.05.2025 and 24.05.2025 at Nhava Sheva, Mumbai. Subsequently, an offence report from the DRI alleged that the importer had imported premium luxury furniture from Italy, China, France and Thailand at substantially undervalued prices and without declaring brands, resulting in alleged customs duty evasion of approximately Rs. 20,00,00,000/-. The investigation also allegedly revealed that M/s. Design Decode was a dummy IEC entity controlled from the premises of Defurn Furniture Studio Plus Sourcing.
The appellant challenged the revocation proceedings, principally contending that the mandatory timeline under Regulation 17 of the CBLR, 2018 had not been followed. According to the appellant, the offence report was received on 18.06.2025, whereas the Show Cause Notice was issued only on 28.10.2025, beyond the prescribed 90-day period. The appellant also repeatedly sought copies of statements of Shri Kailesh Jadhav, G-Card holder, and Shri Shaileshkumar Karmakar, F-Card holder, which were relied upon by the Revenue. Those copies were not supplied.
The appellant had specifically sought clarification regarding receipt of the offence report and subsequently received a copy showing an inward stamp dated 18.06.2025 at New Customs House, Mumbai. Despite repeated requests, the statements relied upon were not provided. The Enquiry Officer ultimately reported that the appellant had failed to discharge obligations under Regulations 10(d), 10(e) and 10(n) of the CBLR, 2018, and the Principal Commissioner thereafter revoked the licence, forfeited the security deposit and imposed the penalty.
Before the Tribunal, the appellant argued that the proceedings violated both the mandatory timelines under Regulation 17 and principles of natural justice. It was also submitted that there was no allegation that the appellant had knowledge of or involvement in the alleged misdeclaration by the importer.
The Revenue opposed the appeal, relying upon the alleged statements of the G-Card and F-Card holders and contending that the appellant had failed to independently verify the genuineness of the importer and had not advised the importer regarding compliance with the Customs Act and allied laws. Reliance was also placed upon the Supreme Court decision in Commissioner of Customs Vs. K.M. Ganatra & Co., concerning the serious responsibilities and obligations of Customs House Agents.
The Tribunal, after considering the record, found that the statements of Shri Shaileshkumar Karmakar and Shri Kailesh Jadhav had been heavily relied upon by the Revenue in the Show Cause Notice as well as in the offence report, but copies of those statements had not been supplied to the appellant despite several requests. Consequently, the appellant had not been given an opportunity to deal with the statements, contradict them or make submissions concerning their contents.
The Tribunal therefore held that principles of natural justice had clearly been violated. It remanded the matter to the Principal Commissioner of Customs for fresh decision after supplying copies of both statements and providing the appellant a reasonable opportunity to make submissions regarding the Show Cause Notice dated 28.10.2025 and the Enquiry Report dated 20.01.2026. The Tribunal expressly stated that it was not considering any other submission made by the appellant at that stage, leaving both sides at liberty to make their submissions before the Principal Commissioner.
The appeal was consequently allowed by way of remand.
Cases Discussed
- Commissioner of Customs Vs. K.M. Ganatra & Co. — 2016 (332) E.L.T. 15 (S.C.), relied upon by the Revenue concerning the serious obligations and responsibilities of a Customs House Agent.
FULL TEXT OF THE JUDGMENT/ORDER OF CESTAT AHMEDABAD
This appeal is directed against the impugned order dated 26.03.2026 passed by the learned Principal Commissioner of Customs, Ahmedabad through which learned Principal Commissioner ordered for revocation of the Customs Broker Licence bearing No. CHA/ABD/R/01/2016-17 (AAKCS2035G) issued to the appellant M/s. Sai Seair Logistics Private Limited under Regulation 14 read with Regulation 17 of Customs Brokers Licensing Regulations, (CBLR) 2018. Order was also passed for forfeiture of security deposit under Regulation 14 read with Regulation 17 of CBLR, 2018 and imposition of penalty of Rs. 50,000/- on Shri Saileshkumar Karmakar ‘F’ Card holder of M/s. Sai Seair Logistics Private Limited in terms of Regulation 18 of CBLR, 2018.
2. The facts of the case in brief are that the appellant M/s. Sai Seair Logistics Private Limited was issued Customs Broker Licence No. CHA/ABD/R/01/2016-17 (AAKCS2035G) by the Principal Commissioner of Customs, Ahmedabad under Regulation 7 of the CBLR, 2013. The appellant is also transacting business at Mumbai. In the normal course of business M/s. Sun Glory Agency, an intermediary firm introduced an importer Major Design Decode (IEC-AHVPJ9060B) to the appellant. The appellant collected the KYC documents of the said importer. The importer imported furniture items from Italy, China, France and Thailand. The appellant after complying with legal requirements, assisted the importer in filing Bill of Entry No. 9908522 dated 06.05.2025 and No. 2252782 dated 24.05.2025 at Nhava Sheva (Mumbai).
2.1 After more than five months from the date of filing of the aforesaid Bills of Entry, the appellant received Show Cause Notice No. 2/2025-26 dated 28.10.2025, for revokation of their Customs Broker Licence under Regulation 14 read with Regulation 17 of CBLR, 2018 alongwith forfeiture of security deposit and imposition of penalty under the said Regulations. The notice referred to an offence report received by the office of the Principal Commissioner of Customs from the DRI, MZU (Mumbai), through the Customs Broker Section, Office of the Commissioner of Customs (General), New Customs House, Mumbai. As per the said report, M/s. Design Decode had imported premium luxury furniture items from Italy, China, France and Thailand at prices undervalued by 5-10 times, without declaring the brands of the items at the time of import thereby evaded customs duty amounting to approximately Rs. 20,00,00,000/-. The DRI had recovered actual invoices pertaining to the import consignments, reflecting the true transaction value of the imported goods. The investigation also revealed that M/s. Design Decode is a dummy IEC entity, controlled and operated from the premises of Defurn Furniture Studio Plus Sourcing.
2.2 As per the appellant, the Show Cause Notice did not meet the vital requirement under the CBLR i.e. the date of receipt of the offence report from the DRI by the Customs Department had not been complied with. The Show Cause Notice relied upon the statement of Shri Kailesh Jadhav, G-Card holder of the appellant firm but neither the date of statement was mentioned nor a copy of the statement was provided. The notice also referred to the statement of Shri Shaileshkumar Karmakar, F-Card holder of M/s. Logistics Private Limited, recorded under Section 108 of the Customs Act wherein Shri Karmakar had admitted that the Appellant had not verified genuineness of the importer nor advised the importer to comply with the provisions of the Customs Act and allied laws. The copy of the statement of Shri Shaileshkumar Karmakar was also not provided. Even the date of the alleged statement of Shri Shaileshkumar Karmakar was not mentioned in the Show Cause Notice.
2.3 The Appellant sent a letter dated 07.11.2025 seeking clarification on the date of receipt of the said offence report by the office of the Commissioner also providing a copy of the offence report and copies of the statements of Shri Kailesh Jadhav and Shri Shaileshkumar Karmakar. Appellant received reply dated 17.11.2025 issued by the Assistant Commissioner, Customs House, Ahmedabad enclosing therewith a copy of the offence report dated 14.06.2025, issued by the Joint Director, DRI, MZU (Mumbai), which bore inward stamp dated 18.06.2025 of the New Customs House, Mumbai indicating clearly that the same was received in Mumbai Customs on 18.06.2025. The copies of the statements of Shri Khailesh Jadhav or Shri Shaileshkumar Karmakar were not provided despite repeated requests.
2.4 The Appellant was informed of a personal hearing on 12.12.2025 fixed by the Assistant Commissioner, acting as the Enquiry Officer, Customs, Ahmedabad vide letter dated 09.12.2025. In response, Appellant submitted letter dated 09.12.2025, requesting copies of the statements of Shri Kailesh Jadhav and Shri Shaileshkumar Karmakar. Subsequently, the Assistant Commissioner, Enquiry Officer, Customs, Ahmedabad issued a letter dated 15.12.2025, informing that a personal hearing had been scheduled at 12.30Hours on 18.12.2025. The Appellant again submitted a letter dated 18.12.2025 addressed to the Principal Commissioner, reiterating its request for providing copies of the aforesaid statements and also submitted that the Show Cause Notice was time-barred. The Assistant Commissioner/ Enquiry Officer, Customs, Ahmedabad issued another communication dated 18.12.2025, fixing the personal hearing on 22.12.2025. In response, the appellant filed detailed written submissions on 23.12.2025.
2.5 The Enquiry Officer issued his Report dated 20.01.2026 completely ignoring their submissions. The Appellant received above enquiry report vide letter dated 03.02.2026 which held that the Appellant had failed to discharge its obligations under Regulations 10(d), 10(e), and 10(n) of the CBLR, 2018. They also made further submissions at the time of personal hearing before Commissioner on 09.03.2026 and also enclosed various case laws in their support. The appellant received impugned Order-in-Original dated 26.03.2026 revoking their CB Licence, forfeiture of the security deposit and imposition of penalty of Rs. 50,000/- upon Shri Shaileshkumar Karmakar, F-Card holder of the Appellant. Being aggrieved with the impugned Order-in-Original dated 26.03.2026, the appellant is before this Tribunal.
3. Learned Counsel for the appellant Shri Devashish K. Trivedi submitted that the impugned order has been passed in violation of mandatory timelines prescribed under Regulation 17 of CBLR, 2018 and without following principles of natural justice as despite repeated requests for providing copies, the statements claimed to have been recorded during investigation and relied upon by the Principal Commissioner, were not provided till date. He submits that there is no allegation that the appellant had any knowledge or he was involved in the alleged misdeclaration of the value of imported goods made in the Bill of Entry by the importer. Therefore, revocation of Customs Broker Licence is too harsh and unfair.
3.1 The learned Counsel also submitted that Regulation 17(1) provides that the Show Cause Notice is required to be issued within a period of 90 days from the date of receipt of offence report. In this case, the offence report is received on 18.06.2025 but the Show-cause-Notice issued on 28.10.2025 is after the statutory 90 day’s time limit. He pleads for setting aside the impugned order by allowing their appeal in the light of detailed submissions made in the appeal memo alongwith annexures.
4. Per contra, the learned AR submitted that the offence report revealed that Shri Kailash Jadhav, G-Card Holder of the appellant firm, in his statement, admitted that M/s. Sun Glory Agency provided them the customer namely M/s. Design Decode and that all the documents related to filing of Bills of Entry for the said importer were provided to them by M/s. Sun Glory Agency. He also accepted that they have not done any independent verification of the authenticity and genuineness of the importer nor were they in direct contact with the importer. All the communications related to import documents and clarifications were provided to them by M/s. Sun Glory Agency. There is no formal agreement between the Customs Broker and M/s. Sun Glory Agency for handling the customs documents by M/s. Sun Glory Agency on behalf of the importer. The offence report further revealed that Shri Shaileshkumar Karmakar, F-Card holder had admitted that they have not done any verification for the genuineness of the importer nor did they advise the importer to comply with the provisions of Customs Act and other allied acts thereby they have violated the provisions of Regulation 10(d), 10(e) and 10(n) of the said regulations.
4.1 Learned AR prays that the impugned order has been passed in accordance with law and may be upheld. He supports his arguments by the law laid down in Commissioner of Customs vs. M/s. K M Ganatra & Co. – 2016 (2) TMI 478 (SC) in which Hon’ble Apex Court has held that on perusal of the order passed by the Commissioner, it is clearly perceptible that there has been number of violations by the respondent. The enquiry report which formed the plinth of the order of the Commissioner demonstrates that by virtue of the transfer of the licence in contravention of the Regulations, on many occasions, immense financial loss has been caused to the Revenue. As the factual matrix would exposit, it is a serious violation. The misconduct reflects a chain of acts. In such a situation, we are disposed to think that the discretion exercised by the Tribunal is inappropriate.
5. We have heard the arguments of the learned Counsel and the learned AR for the department and perused the record.
5.1 From perusal of the record, it emerges that despite relying upon the statements made by Shri Shaileshkumar Karmakar (F-Card holder) and Shri Kailesh Jadhav (G-Card holder) of the appellant firm, the Commissioner has not provided them the copies of these statements inspite of several requests. The statements of both the persons were heavily relied upon by the Revenue in the Show Cause Notice as well as in the offence report. The appellant was not given any opportunity to deal with said statements to contradict and to make submissions with regard to them. Therefore, principles of natural justice have clearly been violated. We therefore remand the matter back to the Principal Commissioner of Customs for deciding the matter afresh after providing copies of the said statements of Shri Shaileshkumar Karmakar F-Card holder and Shri Kailesh Jadhav G-Card holder and after providing reasonable opportunity to the appellant to make submissions regarding the Show Cause Notice dated 28.10.2025 and enquiry report dated 20.01.2026. At this stage we are not considering any other submission made by the appellant. Both sides are at liberty to make their submissions before the Principal Commissioner of Customs, Ahmedabad who will pass the order, after taking into consideration the submissions of both the sides.
6. Consequently, the appeal is allowed by way of remand in the above terms.
(Order pronounced in the open court 20.08.2026)
