Case Details: P.T. Varghese & Company vs. Commissioner of Customs, Ernakulam (2026) 40 Centax 21 (Tri.-Bang)
Judiciary and Counsel Details
- S/Shri P.A. Augustian, Member (J) & Pullela Nageswara Rao, Member (T)
- Shri Baby. M.A, Adv., for the Appellant.
- Shri M. Sreekanth, Asst. Commr. (AR), for the Respondent.
Facts of the Case
The appellant, a customs broker, handled the clearance of baggage declared to belong to an Indian passenger returning from abroad, who had entrusted his personal effects and household goods to an overseas cargo company and authorised the broker’s employee to file the declaration. At the time of clearance, the passenger was personally present before the customs officer, who verified the background and, upon examination, accepted the declared value and cleared the goods on payment of duty. Subsequently, the Special Investigation and Intelligence Branch conducted a re-examination and raised allegations of mis-declaration and undervaluation, on the ground that the consignment was not limited to the said passenger alone. In this context, reliance was placed on an email recovered during investigation, which indicated that the consignment also included baggage belonging to other passengers, thereby forming the basis for alleging misuse of the baggage provisions. The adjudicating authority thereafter revoked the license of the customs broker, forfeited the security deposit, and imposed a penalty for alleged violations of the Customs Brokers Licensing Regulations, 2018, which was contested by the appellant, and the matter was accordingly placed before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT).
CESTAT Held
The CESTAT held that the customs broker could not be held to have violated the relevant provisions relating to authorisation and verification, as the passenger was personally present before the customs officer and the documents furnished were accepted during initial clearance. It was observed that the broker had no knowledge of undervaluation until the subsequent examination by the investigating branch and had no authority in relation to the valuation of goods. The tribunal further held that no contraband, prohibited, or restricted goods were imported and, therefore, the extreme action of license revocation and forfeiture of the security deposit was not justified. However, considering the unrebutted email indicating failure to advise the passenger not to proceed with such clearance where baggage of other persons was also included, the penalty for violation of the relevant regulation was justified. Accordingly, the revocation of the license and forfeiture of the security deposit were set aside, while the penalty was upheld.
List of Cases Cited
- Advent Shipping Agency v. Principal Commissioner — 2023 (2) Centax 157 (Tri. – Cal.) — Referred [Para 10]
- Ajay Oerseas shipping v. Commissioner — Final Order No. 20326/2024 dated 30.04.2024 by CESTAT, Bangalore — Referred [Para 10]
- Commissioner v. K.M. Ganatra and Co. — 2016 (332) E.L.T. 15 (S.C.) — Referred [Para 11]
- Commissioner v. MNS Exports (P) Ltd. – 2012 (281) ELT 524 (Kar.) — Referred [Para 10]
- EXIM Cargo Services v. Commissioner —2019 (366) E.L.T. 883 (Tri. – Del.) — Referred [Para 11]
- H20 Logistics v. Principal Commissioner — 2024 (17) Centax 3 (Tri. – Bom.) — Referred [Para 10]
- Kunal Travels (Cargo) v. Commissioner — 2017 (354) E.L.T. 447 (Del.) — Referred [Para 7]
- MNS Exports Pvt. Ltd v. Commissioner — 2007 (219) E.L.T. 649 (Tri.-Bang) — Relied on [Paras 9, 13]
- Nitco Logistics Pvt. Ltd v. Commissioner — (2026) 38 Centax 277 (Del.) — Referred [Para 11]
- Prabhu Shipping Systems v. Commissioner — 2021 (11) TMI 666 – CESTAT CHENNAI — Referred [Para 11]
- S.C. Ghose & Co (India) Pvt. Ltd v. Commissioner — 2015 (317) E.L.T. 85 (Tri. – Cal.) — Referred [Para 11]
- Sri Kamakshi Agency v. Commissioner — 2001 (129) E.L.T. 29 (MAD) — Referred [Para 11]
- Sriaanshu Logistics v. Commissioner — (2024) 17 Centax 162 (Del.) = 2024 (388) E.L.T. 682 (Del.) — Referred [Para 11]
