Arup Mukherjee Vs Commissioner of Customs (Port) (CESTAT Kolkata)
CESTAT Kolkata held that penalty u/s. 114 of the Customs Act imposable on customs broker and intermediary with regard to non-compliance of their duty of fulfilling KYC requirement. Accordingly, penalty reduced to INR 4 Lakhs.
Facts- The present proceedings are in pursuance of Order-in-Original dated 08.04.2016 passed with reference to Show Cause Notice issued u/s. 124 of the Customs Act, 1962 concerned with a case of attempted export of Red Sanders detected in Customs Transit Declaration (CTD) consignment (Nepal Export). The said order imposes a penalty of Rs.50.00 Lakh each on the two appellants in the present appeal.
Conclusion- Both the appellants herein completely failed in ascertaining the whereabouts by way of KYC of the persons associated from whom they had sourced the business nor were they in possession of any letters of authorization or profile assessment and verification report etc. of their ultimate client M/s. Bhadrakali Export Pvt. Ltd., Nepal for whom they undertook the said transit clearance of Nepal based cargo meant for export to Korea.
Held that the present attempted export of Red Sanders was attempted through a chain of intermediaries with at no stage of any mention of KYC documents coming through is a pointer to the grave omissions at different stages facilitating the said export of banned goods. Shri Arup Mukherjee who used to make payments to the appellant M/s. Bose Enterprises with reference to services rendered by them thus cannot absolve himself of his role as an intermediary in the sordid saga of the said attempted export. The fact that he was an important link and sourcing the business for the customs broker without either knowing his clients nor having obtained necessary documents to ascertain and fulfill the KYC requirements is certainly an omission of serious proportions and having admittedly been in the trade sourcing business for several years it indeed is an omission of multitude ramifications and no less casual and deliberate in nature. Penalty reduced from INR 50,00,000 to 4,00,000.
