M/s. Kwick handling Service Pvt. Ltd. v. The Joint Secretary, Department of Revenue, Ministry of Finance, Government of India

IN THE HIGH COURT OF JUDICATURE AT MADRASDated: 14::11::2008Coram:The Honourable Mr.A.K.GANGULY, CHIEF JUSTICEandThe Honourable Mr.Justice F.M.IBRAHIM KALIFULLAWrit Appeal No. 1246 of 2008M/s.Kwick handling Service Pvt. Ltd.,Presently known asM/s.Sikkas Kwick Handling Service (P) Ltd.,Plot No.23, Ground Floor,24, Wellington Estates,Ethiraj Salai, Chennai – 600 008.Rep. by its Branch Manager,Mr.R.Ramachandran… AppellantVs.The Joint Secretary,Department of Revenue,Ministry of Finance,Government of India,No.14, Hudco Vishala Building, “B” Wing,6th Floor, Bhikaji Cama Place,New Delhi – 110 066.… RespondentAppeal filed under Clause 15 of the Letters Patent against theorder passed in W.P.No. 40311 of 2006 dated 8.7.2008.WP.No.40311 of 2006 is filed under Article 226 of the Constitutionof India to issue a Writ of Certiorari to call for the records of theimpugned order bearing No.524/06 dated 29.09.2006 passed by therespondent so far as confirming penalty to an extent of Rs.10,000/- andquash the same as arbitrary.For Appellant:::: Mr.M.BalagopalFor Respondent:::: Mr.P.Chandrasekaran, SCGSC https://hcservices.ecourts.gov.in/hcservices/ J U D G M E N TTHE HON’BLE THE CHIEF JUSTICEThis writ appeal has been filed by the writ petitioner M/s.KwickHandling Service Pvt. Ltd. presently known as M/s.Sikkas Kwick HandlingService (P) Ltd. functioning as a licensed Custom House Agent (CHA). 2. The relevant facts of the case appear from the judgment of thewrit Court. It appears that the CHA admitted two cardboard boxescontaining the personal effects as unaccompanied baggage of oneMs.Birgitte Arnak Pedersen at Chennai Port for export to Denmark. Thesaid passenger has a Danish Passport and the said consignment along withthe Shipping Bill No.0625691 dated 03.02.2004 were examined in thepresence of one Mr. G.Ramasamy representing the CHA and during suchexamination it was found that there were six objects, namely threenumbers of metal ornaments, two numbers of metal belts and one idol in aglass case, apart from the personal effects of the passenger. Since someof the objects looked very old they were sent for examination by theDepartment of Archeological Survey of India (ASI) to find out whetherthey are antiques or not. On examination the ASI opined that it is clearthat the statue of Buddha was antique in nature and as per the Importand Export Policy of 2000-2001 export of any antique item is prohibited.The Commissioner of Museum, Egmore was thereafter requested to depute aperson to value the antique. Accordingly, the Commissioner visited thewarehouse of the Customs House and valued the antique to the tune of sixlakhs in the international market. 3. The passenger wrote a letter dated 03.04.2004 wherein sherequested for release of her personal goods which were detained apartfrom the antique and also stated that she visited India as tourist andpurchased the articles on good faith from a roadside shop at Gaya. Themanager of the CHA in his statement dated 23.09.2004 also stated that hedid not know about the metal object concealed in the baggage of thepassenger. Thereafter, a show cause notice dated 19.11.2004 was issuedcalling upon the passenger to show cause. 4. The CHA was also called upon to show cause, why penalty shouldnot be imposed on it for having filed the shipping bill by misdeclaringthe antique as Plastic Buddha idol in the shipping bill concealed amongthe personal effects and why penal action under Section 114 of theCustoms Act, 1962 should not be initiated against the CHA. 5.Thereafter, an order in Original Petition was passed by the JointCommissioner of Customs (Adjudication Unit -Sea) over the aforesaid showcause proceedings, and in the said order, the relevant facts were noted.It was held that a personal hearing was given to one Mr.R.Ramachandran, https://hcservices.ecourts.gov.in/hcservices/ Branch Manager and authorized signatory of CHA, who appeared forpersonal hearing on 30.12.2004 and submitted his written submissions. Inthe said written submissions, it was stated that the CHA was having lackof technical knowledge of antique and as such, there is no wilfulmisdeclaration or misstatement. On those facts, the finding by theAdjudicating Authority is that the passenger has stated in her replythat CHA was aware of the contents of the unaccompanied baggage.Therefore, the Adjudicating Authority found that before preparing thecustom documents, the CHA should have ascertained the antique nature ofTeracotta Buddha idol by referring the same to some experts of ASI. Itwas also held by the Adjudicating Authority, on facts, that all thosesix objects, which were suspected by the customs officers as antique,were not declared in the shipping bill, even though documentation forcustomer clearance was done by CHA. On those facts, the AdjudicatingAuthority held that the various decisions, which were cited by the CHA,are not applicable to the facts of the case and ultimately, the JointCommissioner of Customs (Adjudication – Sea) imposed a fine of Rs.3lakhs on the CHA under Section 114(i) of the Customs Act, 1962.6. Against the said order of the Adjudicating Authority rendered inOriginal No.3351/05 dated 08.02.2005, an appeal was preferred by theCHA. Before the Appellate Authority also personal hearing was granted toone P.K.S.Ramakrishnan, Consultant, K.L.Sikka, Managing Director andR.Ramachandran, Branch Manager of CHA. The Appellate Authority foundthat from the records that it is evident that the CHA inspected thegoods before preparing the documents for export and proper packing. So,it cannot be denied that persons doing packing on behalf of CHA were notaware of the contents in the package and presented the goods to thecustoms as was given by the passenger. It was also found that this isnot a case of normal trade export, but is an export against theunaccompanied baggage of a passenger, and entire documentation was madeby the CHA and then signed by the passenger. Therefore, while preparingthe documents, the appellant must have noticed the items and should haveguided the passenger as well as the department. Instead of doing so, theappellant declared the Buddha idol as plastic goods and did not mentionthe other items, namely, metal bells and metal ornaments, in the exportdocuments. The Appellate Authority also did not accept the contention ofthe appellant whereby the certification by ASI and its valuation wasdisputed, since such questions, which were factual in nature, were notraised before the Adjudicating Authority. The Appellate Authorityrefused to accept the contention of the appellant that they were totallyignorant about the nature of the case. However, considering the overallsituation and circumstances of the case, the Appellate Authoritysubstantially reduced the penalty from Rs.3 lakhs to Rs.25,000/-.7. Against the said order of the Appellate Authority dated16.05.2006, a revision was also filed. The Revisional Authority by hisorder dated 29.06.2006 also virtually affirmed the order. But thequantum of penalty was further reduced to Rs.10,000/-. https://hcservices.ecourts.gov.in/hcservices/

8. The learned Judge of the writ court, against such consistentfindings of fact, did not interfere with the order and found that thepenalty, which has been imposed, is very reasonable. Sitting in appealover the said judgment of the learned Judge, this Court cannot take adifferent view from the one taken by the learned Judge, since theinvolvement of the CHA cannot be ruled out in the facts andcircumstances of this case and especially when there is a concurrentfindings against the appellant by all the fact finding authorities.9. Learned counsel for the appellant relied on the Customs HouseAgents Licensing Regulations, 2004 and submitted that under none of theObligations cast under the said Regulations, the appellant is liable. Weare of the view that under 13(d) of the said Regulation, the appellantis liable to advise his client properly to comply with the provisions ofthe Act and in case of non-compliance, bring the matter to the notice ofthe Deputy Commissioner of Customs or Assistant Commissioner of Customsas the case may be. The relevant clause 13(d) is set out below: -“advise his client to comply with the provisions ofthe Act and in case of non-compliance, shall bringthe matter to the notice of the Deputy Commissionerof Customs or Assistant Commissioner of Customs” 10. In our considered view, the appellant has failed to dischargehis duty in terms of clause 13(d) of the Regulations. Learned counselfor the appellant also relied on a judgment in the case of Commissionerof Customs, Tuticorin v. Moriks Shipping and Trading Pvt. Ltd. reportedin 2008 (227) E.L.T 577(Tri-Chennai). The said judgment was rendered ontotally different facts, inasmuch as in that case the goods declared bythe exporter in the relevant shipping bill was Organic dye intermediateG-salt, whereas on detail examination of the case by the officer of thecustoms followed by chemical examination of the case in the departmentallaboratory, the goods were found to be common salt. In such a situation,it was difficult for the CHA to find out distinction between Organic dyeintermediate G-salt and common salt. Whether the goods are Organic dyeintermediate G-salt or common salt can only be ascertained on detailexamination by the customs officer followed by chemical examination inthe laboratory. But, in the instant case, whether it was a Buddha idolmade of plastic or whether the Teracotta Buddha idol made of metal orstone has any antique value can be found on prima facie examination ofthe item itself. Therefore, the decision in the case of Commissioner ofCustoms, Tuticorin v. Moriks Shipping and Trading Pvt. Ltd.(supra) isquite distinguishable on facts and has no application to the facts ofinstant case. 11. For the reasons aforesaid, we, sitting in writ jurisdiction,cannot interfere with the concurrent findings of fact by thedepartmental authorities, and those findings, which are reasoned andbased on relevant materials, cannot be called perverse either. https://hcservices.ecourts.gov.in/hcservices/

12. Therefore, the appeal fails and the order of the RevisionalAuthority is confirmed. No costs. Consequently, miscellaneous petitionis closed. Sd/Asst.Registrar/true copy/Sub Asst.RegistrarSm./pvCopy to:The Joint Secretary,Department of Revenue,Ministry of Finance,Government of India,No.14, Hudco Vishala Building, “B” Wing,6th Floor, Bhikaji Cama Place,New Delhi – 110 066.1 cc To Mr.M.Rajagopal, Advocate, SR.63459.W.A.No.1246 of 2008 KA(CO)RVL 18.11.2008