KUNAL TRAVELS Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) This application arises in an appeal preferred against an order of the Commissioner of Customs, whereby a penalty of Rs. 1 lakh was imposed on the applicant under Section 114 of the Customs Act. The prayer is for waiver of pre -deposit and stay of recovery in respect of the penalty amount.

(2.) I have examined the records and heard both sides.

(3.) It appears from the records and the submissions that the applicants had functioned as CHA for an exporter, M/s. Zenith International in respect of export of brass articles under a few shipping bills. They had discharged their function through their employee, one Shri Ambrish Chauhan, holder of 'H' card. After scrutiny of the shipping bills (claiming drawback), relevant invoices and packing lists, officers of Customs cleared the consignment for stuffing. However, the stuffed goods were destuffed and subjected to re -examination, whereupon a shortage of quantity was found. Statement of the exporter, CHA, etc., were recorded and, on completion of the investigation, show -cause notices were issued to the exporter, CHA (present applicants) and the employee of the latter, for confiscating the goods, imposing penalty, etc. As against the exporter, the Commissioner by order dated 15 -3 -2002 found them guilty of misdeclaration of the goods and imposed a penalty on them, apart from confiscating the goods with option for redemption. As against the CHA and their employee, the Commissioner passed a separate order, which is presently under challenge. Ld. Counsel for the applicants submits that there is neither any charge of collusion against the CHA in the show cause notice nor any finding to that effect in the Commissioner's order. It is further submitted that there is, so far, no departmental action against the CHA under the CHA Regulations 1984. Ld. counsel argues that Section 114 of the Customs Act, whereunder the penalty in question has been imposed on the CHA, was not the provision to have been pressed into service, in the first instance, against the CHA on a ground that they had failed to discharge some obligation under the Regulations. According to ld. Counsel, the CHA Regulations were a self -contained code laying down the procedure for bringing a CHA to book for violation of any of the Regulations. It is submitted that nothing other than violation of Regulation No. 14(e) of the CHA Regulations has been alleged against the appellants in this case, for which the appropriate action is under the Regulations and not under Section 114. On this basis, Counsel pleads a strong prima facie case. Ld. DR refers to the show cause notice and submits that there is a clear allegation of abetment/omission against the CHA and the same has been upheld in the order of the Commissioner. According to ld. DR, this finding is enough to impose a penalty on the CHA under Section 114 of the Customs Act.