Narendra Forwarders Pvt. Ltd Vs Commissioner of Customs (Import) (CESTAT Mumbai)
The appeal before the Tribunal concerned the sustainability of a penalty imposed on a licensed Customs House Agent (CHA) after a classification dispute between the importer and the customs department had already been settled in favour of the importer. The penalty had been confirmed by the Commissioner (Appeals) despite the classification issue no longer surviving against the importer.
The facts showed that during November–December 2007, the importer engaged the appellant CHA for clearance of “fabricated Aluminium products including glass/accessories” under three Bills of Entry. Based on the invoices and shipping documents, the goods were classified under CTH 73.08, which allowed exemption from additional duty of customs under Notification No. 3/2005. The Bills of Entry were initially assessed under this heading with exemption. In September 2010, the Directorate of Revenue Intelligence questioned the classification, proposing classification under CTH 76.10, which did not allow such exemption. Upon being pointed out, the importer paid the differential duty of Rs. 27,87,692 along with interest on 14.09.2010.
Despite this payment, a show cause notice was issued to the CHA proposing penalty under Section 112(a) of the Customs Act. The penalty of Rs. 1,00,000 was confirmed, and the CHA’s first appeal was dismissed for non-compliance with a pre-deposit order. The Tribunal later remanded the matter for de novo consideration without pre-deposit. Meanwhile, in the importer’s own case, the Tribunal held that the goods were correctly classified and entitled to the claimed benefit. However, even after this order was produced, the Commissioner (Appeals) again confirmed the penalty against the CHA, leading to the present appeal.
