2011 (4) TMI 188 - HC - Customs

CHA license suspended - The fabricated documents were (one) letter of State Bank of India Branch IBD Mumbai to the effect that no remittances have been made to the Chinese Shipper in respect of the H.R. coils in question and (two) letter from Ahwin Impex the importer to the effect that they are authorising the petitioners to re-export H.R. coils to China which were earlier shipped from China to India - Apart from the above suspension of a CHA licence under Regulation 20(2) of the 2004 Regulation can be ordered where immediate action is necessary - In the present case the customs authorities in the middle of January 2011 were aware of the fact that the documents submitted by the petitioners were fabricated however the impugned order has been passed belatedly on 28/3/2011 - Rule is made absolute in the above terms with no order as to costs

Summary

Issues:
1) Suspension of Customs House Agent (CHA) license under Regulation 20(2) of the Customs House Agents Licensing Regulations, 2004.
2) Allegations of filing re-export application based on fabricated documents.
3) Delay in passing the suspension order and subsequent impact on the petitioners' business.

Issue 1: Suspension of CHA License
The petitioners challenged the suspension of their CHA license by the Commissioner of Customs, arguing that they have been in the business for 33 years with an unblemished record. The suspension was based on the petitioners' request for re-export of H.R. coils using allegedly fabricated documents received from the Chinese Shipper. The investigation revealed discrepancies in the documents submitted by the petitioners, leading to the suspension of their license under Regulation 20(2) of the 2004 Regulations.

Issue 2: Allegations of Fabricated Documents
The customs authorities found that the petitioners had filed for re-export based on fabricated documents, including a letter from the State Bank of India and another from Ashwin Impex. Statements from the petitioners' employees confirmed that the documents were received from the Chinese counterpart via courier. However, the Chinese counterpart admitted to forwarding these documents and took responsibility for the situation, indicating that the petitioners may not have actively participated in fabricating the documents.

Issue 3: Delay in Passing Suspension Order
The High Court noted a delay in passing the suspension order, which impacted the petitioners' business for almost a month. Despite a post-decisional hearing, no further action was taken by the customs authorities. The Court considered this delay unjust, especially since the suspension was based on fabricated documents and no revenue loss occurred. Consequently, the Court quashed the suspension order, allowing the customs authorities to take appropriate action after completing the investigation.

In conclusion, the High Court revoked the suspension of the CHA license, emphasizing the need for timely and justified actions by the customs authorities. The judgment highlighted the importance of thorough investigations and adherence to regulations in cases involving the suspension of licenses, ensuring fairness and procedural integrity in such matters.