Daga Shipping Agents Private Limited Vs Commissioner of Customs (CESTAT Kolkata)
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata, has set aside a penalty of ₹3 lakh imposed on Daga Shipping Agents Pvt. Ltd., a customs broker, for alleged failures in verifying an exporter’s details. The tribunal ruled that the penalty was unjustified as the appellant had acted in a “bona fide belief” after verifying all the required documents.
The case stemmed from a shipping bill filed by the appellant on behalf of an exporter for the consignment of capacitors. The goods were detained by the Special Investigation Branch (SIB) on the grounds of overvaluation. Subsequently, a show cause notice was issued, which not only proposed the re-determination of the goods’ value and their confiscation but also initiated penal action against the customs broker. The Customs Broker’s penalty was based on the allegation that it had failed to verify the identity and address of the exporter, which purportedly led to a loss of revenue.
The investigation revealed that summons issued to the exporter had been returned by postal authorities with remarks such as “insufficient address” and “no such firm exists.” However, the appellant, in its defense, contended that it had diligently obtained all necessary documents from the exporter, including Know Your Customer (KYC) forms, an authorization letter, an Aadhar card, a PAN card, an income tax return, a bank letter, and a GST certificate. The tribunal noted that the revenue department had not disputed the fact that these documents were obtained by the appellant. The appellant also argued that its role was limited to facilitating the export and that it had no knowledge of the consignment’s contents.
