Delhi High Court Rejects Appeals By Customs House Clearing Agent Staff Penalised In ₹3.4 Crore Cigarette Smuggling Case

The Delhi High Court recently refused to show any leniency to two employees of a Customs House Clearing Agent (CHA), found involved in smuggling of cigarettes worth Rs.3,40,74,000/-.A division bench of Justices Prathiba M. Singh and Shail Jain observed that CHAs and their employees are responsible to ensure discharge of obligations under the Customs Brokers Licensing Regulations, 2018.Reliance was placed on Commissioner Of Customs (Airport And General) v. M/S Jaiswal Import Cargo Services Ltd (2025) where a coordinate bench had held that Customs Broker must diligently perform its responsibilities under the 2018 Licensing Regulations and any failure thereof must be met with a proportionate punishment.In the case at hand, an inspection of an imported mattresses consignment revealed that cigarettes of foreign origin were concealed therein. The two Appellants then came to centre stage for their alleged role in the smuggling.Whereas one Appellant had signed the consignment, despite being fully aware of the illegal imports, the other Appellant was his supervisor.As such, a penalty to the tune of Rs. 50 lakhs was imposed upon them by the Original Authority. CESTAT however reduced the penalty to Rs.10 lakhs. Aggrieved, the Appellants moved the High Court.They argued that they were mere salaried employees of the CHA and their role was quite limited in nature.The Department on the other hand opposed the appeals, stating that the Appellants' roles were discussed in detail by CESTAT which also took a sympathetic view and reduced the penalty.Agreeing, the High Court said, “This Court has already considered the role of CHAs and their employees in ensuring discharge of obligations under the Customs Brokers Licensing Regulations, 2018 (hereinafter, 'CBLR, 2018') in the decision in Commissioner of Customs (Airport and General) v. M/S Jaiswal Import Cargo Services Ltd.”It added, “The Court, having considered the factual background of this case, as also the role played by the two Appellants, which was active and supervisory in nature respectively, is of the opinion that no question of law arises in this matter. The penalty has been rightly imposed and the CESTAT has already taken a sympathetic view of the matter and reduced the penalty.”As such, the appeals were dismissed.Appearance: Mr. Bharat Bhushan, Ms. Nidhi Gupta & Mr. Anunay Mishra, Advs. for Appellants; Mr. Harpreet Singh, SSC with Ms. Suhani Mathur, Mr. Jai Ahuja, Mr. Sanidhya Sharma, Mr. Akshya Saxena & Ms. Shivali Saxena, Advs. for RespondentCase title: Sushil Sharma v. Commissioner Of Customs [Export]Citation: 2025 LiveLaw (Del) 1511Case no.: CUSAA 81/2019Click here to read order

Delhi High Court Rejects Appeals By Customs House Clearing Agent Staff Penalised In ₹3.4 Crore Cigarette Smuggling Case

Kapil Dhyani

Tags