The Delhi High Court has ended the Customs Broker’s Licence Suspension After 13 months subject to Rs. 4 lakh contribution for public causes.
The bench of Justice Prathiba M. Singh and Justice Shail Jain has observed that there is no doubt that Customs Brokers do have significant responsibility under the CBLR 2018 which ought to be performed with diligence and commitment. The fact that the Customs Broker did not oversee the clearance and the warehousing of the goods leading to diversion of the goods in the domestic market is a clear infraction.
However, the bench noted that the customs broker has already suffered in its business for 13 months. Applying the principle of proportionality, this Court is of the opinion that the suspension/ revocation for a period of 13 months is a sufficient period considering the nature of violation.
The respondent, M/s Jaiswal Import Cargo Services Ltd. is a customs brokers whose license was suspended due to non-compliance of the Customs Brokers Licensing Regulations, 2018 (CBLR 2018).
The Order has been set aside by CESTAT. In effect, therefore, the revocation of the license of the Respondent has been set aside. The allegation against the Respondent was that one M/s Tanu Trading vide Bills of Entry No. 3673416 dated 09th December, 2022 had imported certain cosmetic items with the intention to re-export the same. However, the goods instead of being deposited in a bonded warehouse, were in fact, diverted to the local market for home consumption.
Pursuant to the intelligence received by the Department in respect of the allegations, efforts were made to locate the premises of the importer, however its address was found to be fake and bogus. Further, the office premises of the Respondent were also searched.
An offence report was then filed for action against the Respondent for having enabled the diversion. A Show Cause Notice was then issued and after the inquiry report the Order was passed on 23rd February 2024. The Order-in-Original held that the Respondent violated the CBLR 2018.
The allegations were considered by the CESTAT in the impugned order which held that the KYC documents pertaining to the importer were duly verified by the Respondent. These documents were not fraudulent or fake. It was held by CESTAT that the only obligation of the Customs broker is to physically verify the premises and the verification of the Government issued documents. This has been done by the Respondent.
The CESTAT held in favour of the customs broker.
The Department contended that the Customs Broker has a duty and obligation to ensure that there is no violation of the CBLR 2018. The various statements which were recorded during the investigation by the Department revealed the complicity of the Respondent. The role played by the customs broker was more active and it had failed to oversee clearance of the goods from Customs which led to the illegal divergence. Proper authorisation was also not obtained from the importer by the Respondent as per the Appellant.
After the issuance of the SCN, the Respondent’s licence was suspended at all Customs Stations/ Ports of India with immediate effect vide order dated 16th June 2023.
The suspension was thereafter revoked on 17th August, 2023 which is recorded in para no. 9 of the Order-in-Original. However, when the Order-in-Original was passed on 23rd February 2024, the license was again revoked. This order continued till the final order of the CESTAT on 2nd January 2025. Therefore, for a total period of 13 months, the Respondent’s business had come to a standstill. The primary responsibility here was of the importer and at best the allegation against the Customs Broker was that it was complicit with the importer.
The appeal filed by the Department now seeks to reinstate the revocation against the Customs broker which this Court is not inclined to do.
There is no doubt that Customs Brokers do have significant responsibility under the CBLR 2018 which ought to be performed with diligence and commitment. The fact that the Respondent did not oversee the clearance and the warehousing of the goods leading to diversion of the goods in the domestic market is a clear infraction.
The customs broker submitted that as a matter of retribution, the Respondent is willing to contribute a sum of Rs. 4 lakh towards some good cause. Taking this statement on record, this Court is of the opinion that the suspension of 13 months and with the payment of Rs. 4 lakh, the SCN proceedings can come to an end.
The court has directed that the customs broker shall deposit Rs. 2 lakh to be deposited with the Customs Department; Rs. 1 lakh to the Delhi High Court Legal Service Committee and Rs. 1 lakh to the Delhi High Court Bar Association. The revocation/suspension of the Respondent’s Customs Broker License is restricted to the 13 months which has already been undergone.
Case Details
Case Title: Commissioner Of Customs Versus M/S Jaiswal Import Cargo Services Ltd
Case No.: CUSAA 111/2025 & CM APPL. 53964/2025
Date: 28th August, 2025
Counsel For Appellant: Aakarsh Srivastava
Counsel For Respondent: Piyush Kumar
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