The Chennai Bench of Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai, has upheld a Rs. 50,000 penalty imposed under Regulation 18 of the Customs Brokers Licensing Regulations, 2013 (CBLR), for failing to report significant discrepancies between declared and actual weights in import consignments.
The bench of P. Dinesha (Judicial Member) and M. Ajit Kumar (Technical Member) has observed that CBLR 2013 requires the Customs Broker to discharge its functions with diligence and efficiency and display the prudence expected of a common man. Merely stating that he was not aware of the mis-declaration would not suffice. Regulation 11(d) requires the CB to advise his client to comply with the provisions of the Act and in case of non-compliance, shall bring the matter to the notice of the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be.
The Tribunal took exception to the disrespectful tone used in the Custom Broker’s appeal memorandum, reminding Custom Broker that professional decorum must be maintained in legal pleadings. “Just because the appellant feels that an authority has erred should not be an excuse to show disrespect,” the bench remarked.
The Customs Broker (CB) had appealed against a 2018 order by the Commissioner of Customs (Import), Chennai-VIII, which found the CB negligent in clearing consignments on behalf of an importer who had repeatedly under-declared container weights. The discrepancies came to light after SIIB (Special Intelligence and Investigation Branch) officers found actual container weights nearly double the declared figures.
Investigations showed a pattern of misdeclaration in 10 previous consignments, involving over 65 metric tons of undeclared cargo. The Tribunal ruled that the Customs Broker, while not directly responsible for weighment, failed in their duty to exercise due diligence and report the discrepancies when weighment slips were collected at the Container Freight Station (CFS).
The Tribunal also noted signs of forged weighment slips and emphasized that under Regulation 11(d), it was the CB’s obligation to alert authorities in the event of any suspected non-compliance. Merely pleading ignorance was not a valid defense.
The tribunal, while rejecting the argument that the Customs Broker could not be penalized after their license was revoked in an earlier proceeding, the Tribunal clarified that while a revoked license cannot be cancelled again, the CB remains liable for misconduct committed while the license was active. As such, imposition of penalty remains valid.
Case Details
Case Title: M/s. Raj Brothers Shipping Pvt. Ltd. Versus Commissioner of Customs (Import)
Case No.: Customs Appeal No.42090 of 2018
Date: 20/06/2025
Counsel For Appellant: N. Viswanathan
Counsel For Respondent: Anoop Singh
Read More: Vedanta Denied Interest on Rs. 7.12 Crore Customs Refund: CESTAT
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