The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata has upheld the revocation of a Customs Broker Licence and forfeiture of the security deposit of a Kolkata-based customs brokerage firm over serious lapses involving the unauthorized sharing of G-Card Holder’s login credentials that facilitated misdeclaration in import consignments.
The bench of Ashok Jindal (Judicial Member) and K. Anpazhakan (Technical Member) observed that the Customs Broker engaged a G-card Holder, namely, Shri Nitesh Patel by executing a Power of Attorney in his favour, to function on their behalf as a Customs Broker at Mumbai Customs. The allegation against the customs broker is that their G-Card Holder, i.e., Shri Nitesh Patel has given his ID and password to one Shri Pragnesh Gandhi to allow him access to the Licence. In the general business of a Customs Broker, such providing of ID and password is common which can be misused.
The bench noted that the access given by the G-Card holder led the misuse of the facility and on that basis misdeclaration of import consignments were detected. If the G-Card holder would not give his ID and password in that circumstances the misdeclaration, by the importer would have been avoided.
The proceedings were triggered by an offence report from the Directorate of Revenue Intelligence (DRI), Mumbai Zonal Unit, dated September 8, 2017. It detailed alleged irregularities by a G-card holder employed by the customs broker, who was authorized to act on their behalf at Mumbai Customs through a Power of Attorney.
The DRI cited two show cause notices one involving Bright Traders, with mobile phones and electronic goods allegedly misdeclared and in violation of MRP valuation and BIS standards. Another against Bright Ways, related to undervaluation of PVC sheets and vacuum flasks.
In both cases, the respective importers admitted to the misdeclaration and undervaluation when questioned by authorities. A key element in the investigation was the role of the G-card holder, who had reportedly allowed a third party — a former customs broker employee — to access sensitive login credentials.
The tribunal noted that while engagement of the G-card holder was not improper per se, the misuse of the broker’s digital credentials by an unauthorized third party had directly enabled the misdeclaration of goods.
The appellant’s argument that there was no commercial sale or one-time transfer of the licence was deemed insufficient to override the gravity of the misconduct.
“Providing ID and password is common, but it can be misused,” the bench remarked, adding that such lapses in credential control facilitated the violations observed during the import process.
The tribunal emphasized that even indirect facilitation of fraudulent activity by way of negligence or lax supervision is a serious breach under the Customs Broker Licensing Regulations.
The tribunal while upholding the Commissioner’s order, the bench concluded that the revocation of the licence was legally sustainable. The forfeiture of the security deposit was justified. The appeal was without merit and thus dismissed.
Case Details
Case Title: M/s. GMC & Co. Versus Commissioner of Customs (Airport & Administration)
Case No.: Customs Appeal No. 75370 of 2019
Date: 10.07.2025
Counsel For Appellant: H. K. Pandey, Advocate
Counsel For Respondent: T. Sulaiman, Authorized Representative
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