2026-VIL-487-CAL-CU
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CUSTOMS High Court Cases

Customs - Customs Broker's Liability for Overvalued Export Goods - Failure by Customs Broker to exercise due diligence - Whether the Customs Broker is liable for penalty under Section 114(iii) of the Customs Act, 1962 for failure to exercise due diligence in accepting export documents from an unauthorized person and for not verifying the exporter's address, which resulted in the export of grossly overvalued goods - Whether the customs broker can be held liable for misdeclaration or overvaluation of export goods, and Whether the CHA is obligated to physically verify the exporter's address under the Customs Broker Licensing Regulations, 2018 – HELD – The liability for misdeclaration or overvaluation of export goods lies with the exporter, and the Customs broker cannot be held responsible for the same. The customs broker's duty is limited to verifying the authenticity of documents and information provided by the client, not the accuracy of the declared value. The adjudicating authority failed to consider the binding precedent in World Cargo Movers v. Commissioner of Customs, which held that it is not the job of the customs broker to compare the invoice price with market price - Regarding the physical verification of the exporter's address, the Customs Broker Licensing Regulations, 2018 do not mandate physical verification, and only require the customs broker to verify the client's identity and functioning at the declared address using reliable documents and information - The Customs Broker is not required to physically verify the premises of the exporter or compare the declared value with the market price. The adjudicating authority failed to consider the submissions made by the Customs Broker and the binding precedents cited by him. The impugned order is set aside and the matter is remanded back to the adjudicating authority to take a fresh reasoned decision after affording due opportunity to the Customs Broker and considering all the material on record – The petition is disposed of
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