M/S R. K. Logistics vs. Commissioner Of Customs

This appeal is filed under Section 130 of the Customs Act, 1962 (for short ‘the Act’) against the final order no. 59920/2024 dated 23.12.2024 passed by the Customs, Excise & Service Tax Appellate Tribunal (for brevity ‘the tribunal’) in customs appeal no. 51092/2020. 2. The brief facts are that the appellant is a proprietorship concern. On 13.11.2014, the proprietor applied for Customs Broker licence (hereinafter ‘the licence’) under the Customs Brokers Licensing Regulations, 2013 (for brevity ‘2013 Regulations’). The application form was annexed as Annexure P-5 to the appeal before the tribunal, qualifications mentioned in form are the CUSAA 120/2025 MBA degree from Sikkim Manipal University (for short ‘SMU’) and the graduation degree from Chaudhary Charan Singh University, Meerut (for short ‘CCSU’). While applying for licence graduation degree was not enclosed with the application, instead a notarized affidavit was filed stating that the appellant was a graduate from CCSU. The appellant cleared the written and oral examination and was granted the licence on 02.11.2016. A complaint was received on 08.08.2019 in the office of the Commissioner of Customs, ACC (Import) alleging irregularities in the BA degree of the appellant from CCSU. On 09.08.2019, the appellant was directed to furnish an attested copy of the graduation certificate and it was forwarded to CCSU for verification. On 05.10.2019, a verification report was submitted by CCSU stating that the details of BA degree and marksheet of the appellant were not as per the university enrolment and confidential records and that “it seems otherwise”.

1 On 11.10.2019, the licence of the appellant was suspended. Pursuant to the show cause notice (for short ‘SCN’) issued, the appellant availed the opportunity for personal hearing and in the representation filed requested for re-verification of the degree. The suspension was confirmed on 25.10.2019. The BA degree and marksheet were sent by the respondent to CCSU for re- verification. The Vigilance Officer of CCSU in response to the second verification reiterated the earlier verification report dated 05.10.2019. The respondent issued SCN dated 27.12.2019 proposing revocation of the licence, forfeiture of security and levy of penalty. The Assistant Commissioner of the department was appointed as the Inquiry Officer (for short ‘IO’). The appellant responded to the SCN on 21.01.2020, personally appeared before CUSAA 120/2025 the IO and sought time to produce a duplicate copy of the degree from CCSU. The written submissions dated 22.02.2020 were filed before the IO. The report by IO was submitted on 27.03.2020. It was observed that despite being given an opportunity the appellant failed to prove the genuineness of the graduate degree and there was infringement of regulations 5(h)(i) & (ii) of the 2018 Regulations.

2 The respondent issued notices dated 12.05.2020 and 06.06.2020, the appellant attended the personal hearing on 17.06.2020 and filed written submissions rebutting the inquiry report.

3 On 01.07.2020, an order under regulations 14 and 17(7) of the 2018 Regulations was passed revoking the licence and forfeiting the security. A penalty of Rs.50,000/- was also imposed under regulation 18(1) of the 2018 Regulations. The tribunal dismissed the appeal on 23.12.2024 and upheld the order dated 01.07.2020. Hence, the present appeal.

The following substantial questions of law have been proposed by the appellant: “I. Whether the Hon’ble Tribunal failed to appreciate that the Customs Broker Licensing Regulations, 2013/2018 contain no provision authorising re-verification of academic qualifications after grant of licence, and that the Respondent’s reliance on post-licence “reverification” is without juri iction and contrary to the scheme of the Regulations? II. Whether the Hon’ble Tribunal erred in law by upholding the revocation of the appellant’s Customs Broker Licence despite the undisputed fact that the Respondent had, at the time of grant of licence in 2016, already verified and satisfied itself regarding the appellant’s academic qualifications as mandated under Regulation5 of the Customs Broker CUSAA 120/2025 Licensing Regulations, 2013? III. Whether the Respondent could invoke the provisions of the CBLR, 2013/2018 against the Appellant for alleged discrepancies at the stage when he was merely an applicant and not yet a Customs Broker, despite the fact that the Respondent themselves had verified and accepted his qualifications before issuing the licence? IV. Whether the Hon’ble Tribunal failed to appreciate that once the statutory authority had conclusively verified and accepted the appellant’s eligibility and academic qualifications before granting the Customs Broker Licence, it was impermissible in law to re-open or re-verify the same at a subsequent stage on the basis of an anonymous and unverified complaint? V. Whether the reliance placed by the Respondent and upheld by the Tribunal on an ambiguous, incomplete and inconclusive report of CCS University dated 05.10.2019, which neither declared the appellant’s degree fake nor fabricated, amounts to a perverse finding unsupported by cogent evidence in the eyes of law? VI. Whether the Hon’ble Tribunal erred in law in not considering that the appellant’s Graduation Degree had already been independently verified and accepted by multiple reputed institutions, including Sikkim Manipal University (for MBA), IMT Ghaziabad (for PG Diploma), and NMIMS (for HR Diploma), thereby conclusively establishing the validity of the said qualification? VII. Whether the Hon’ble Tribunal committed an error of law in not appreciating that the proceedings initiated on the basis of an anonymous e-mail complaint, which was neither diarised, nor authenticated, nor traceable to any complainant, are wholly vitiated and non est in the eyes of law? VIII. Whether the Respondent, in exercise of powers under Regulation18 of the Customs Broker Licensing Regulations, 2013/2018, can legally impose penalty more than once where the maximum penalty prescribed under the Regulations is CUSAA 120/2025 ₹50,000/-, and whether they can pass repeated order of forfeiture of the security deposit when the statutory framework permits forfeiture of security only up to a maximum of ₹5,00,000/-? IX. Whether Section 132 of the Customs Act, 1962, which is confined to false declarations and documents in respect of import/export shipments and clearance of goods, can be legally invoked in proceedings relating to verification of educational qualifications submitted by an applicant for grant of Customs Broker Licence, when no shipment, goods, or customs clearance process is involved? X. Whether the Hon’ble Tribunal erred in law in upholding the imposition of penalty and forfeiture of security deposit under Regulation 18 of CBLR, 2018, despite there being no finding of fraud, suppression, or deliberate misrepresentation on the part of the appellant? XI. Whether the impugned order of revocation, forfeiture and penalty are liable to be set aside as being arbitrary, disproportionate, and violative of the principles of natural justice under Articles 14 and19(1)(g) of the Constitution of India? XII. Whether the impugned order is sustainable in absence of proper cross-examination of university authorities or any opportunity to rebut the adverse material? XIII. Whether principles of natural justice were violated in the inquiry and revocation proceedings? XIV. Whether the Tribunal could have applied 2018 Regulations retrospectively when the application and grant of license were governed by the 2013 Regulations?”

Learned counsel for the appellant submits that the appellant in 2010 was granted a BBA degree from Chhatrapati Shahu Ji Maharaj University, Kanpur (for short ‘CSJMU’) and this was not considered by the tribunal and the respondent. The contention is that the appellant was not granted an CUSAA 120/2025 opportunity to cross-examine the officials of CCSU. The grievance is that the penalty could not have been invoked after revocation of the licence.

Learned counsel for the respondent defends the impugned order and contends that the appellant by submitting a forged affidavit with regard to his graduation obtained the licence in violation of Regulation 5(h) of the 2018 Regulations.

1 The submission is that under regulation 5(h) of the 2018 Regulations, the appellant should be a graduate from a recognised University and has to possess the qualification specified in clause 5(h)(ii). The levy of penalty is defended to be in accordance with regulation 18 of the 2018 Regulations and was independent of the revocation of the licence.

Heard learned counsel for the parties at length and perused the record with their able assistance.

Before proceeding further, it would be apposite to quote the relevant portions of regulations 5, 14, 17 and 18 of the 2018 Regulations:

It is an admitted fact that the appellant while applying for the licence had not attached the graduation degree but filed an affidavit to the effect that he was a graduate from CCSU. The MBA degree from SMU was annexed with the application. After receipt of the complaint the graduation degree was sent for verification and on the request of the appellant was again sent for re- verification. The verification report of the University stated that the details of the BA degree and the marksheet were not as per the University enrolment and confidential records and that “it seems otherwise”.

Under regulation 5(h) of the 2018 Regulations, the appellant to be eligible to apply for the licence had to possess a graduation degree from a recognized university and also a professional degree as specified in clause 5(h)(ii). The graduation degree was furnished pursuant to the direction of the CUSAA 120/2025 respondent and on verification was found not to be issued by CCSU. The order dated 01.07.2020 and the order of the tribunal record a concurrent factual finding that the graduation degree furnished by the appellant was forged. The contention regarding the BBA degree granted in 2010 from CSJMU was not raised before the IO, in the revocation proceedings or before the tribunal. The appeal before this court is on substantial questions of law and questions of fact cannot be gone into.

The opportunity to cross-examine the officials of CCSU was neither raised before the IO nor in the revocation proceedings before the Commissioner of Customs (Airport & General), New Delhi and was not pressed before the tribunal as is evident from the impugned order. It is not the pleaded case in the appeal that this issue was pressed before the tribunal but was not dealt with. Be that as it may, cross-examination is not an unfettered and absolute right. Reference in this regard be made to the following judgments:

1 The Supreme Court in Kanungo and Co. v. Collector of Customs, (1973) 2 SCC 438 held as under:

2 The Division Bench of this court in Vallabh Textiles v. Additional Commissioner Central Tax GST, Delhi East & Ors., 2025 SCC OnLine Del 2435 held as under: