E. Joseph John Vs Commissioner of Customs (CESTAT Chennai)
Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) Chennai has set aside penalties of Rs. 10,00,000/- under Section 114(i) and Rs. 3,00,000/- under Section 117 of the Customs Act, 1962 (CA 1962), imposed on E. Joseph John, an employee of a Custom House Agent (CHA). The penalties were levied in connection with an attempted illegal export of red sanders, a prohibited item. The Tribunal’s decision hinges on the principle that violations related to the duties of a CHA should be addressed under the specific Custom House Agent Licensing Regulations (CHALR) and not directly under the Customs Act unless a clear case of abetment or involvement in rendering goods liable to confiscation is established.
The case originated from specific intelligence that red sanders were being illegally exported through Tuticorin Sea Port. Officers intercepted a truck carrying a container declared to contain dehusked coconut under a shipping bill filed by S.K. Enterprises. Upon examination, it was discovered that the container, despite appearing sealed and certified, actually contained red sanders hidden behind bags of coconut. The red sanders, valued at Rs. 79.50 lakhs, were seized.
E.Joseph John, as an employee of a CHA, had filed the impugned shipping bill based on instructions from individuals associated with S.K. Enterprises. A show cause notice (SCN) was issued, alleging that by filing the shipping bill for a prohibited item, he was liable for penalties under Sections 114 and 117 of the CA 1962. The Adjudicating Authority subsequently imposed the aforementioned penalties.
