2019 (12) TMI 22 - HC - Customs

Revocation of Customs Brokers (CB) License - forfeiture of security deposit - time limit for issuance of offence/enquiry report - main contention of the petitioners in all these cases is that the time prescribed under the Regulations for doing each act is mandatory and therefore, if no such act is done within the time prescribed, the same cannot be sustained.

HELD THAT:- The Authority, who suspends the license/revokes the license/imposes penalty, should act/issue certain proceedings within the time stipulated therein. Under 19(1) of 2013 Regulations, the Commissioner of Customs is empowered to suspend the license in an appropriate case, where immediate action is necessary and where an enquiry against such agent is pending or contemplated. It is further seen that if a license is suspended under Sub Regulation (1) of Regulation 19, the Commissioner shall give an opportunity of hearing to the customs broker within 15 days from the date of suspension of license and pass such order, as he deems it fit, either revoking the suspension or continuing it within15 days from the date of hearing granted to such customs broker. In case, the Commissioner passes an order for continuing the suspension, further procedure thereafter shall have to be followed as provided under Regulation 20.

This Court, after considering the scope of the relevant regulation and the time frame fixed therein and also after following the Division Bench decision of the Delhi High Court in IMPEXNET LOGISTIC VERSUS COMMISSIONER OF CUSTOMS (GENERAL) [2016 (6) TMI 348 - DELHI HIGH COURT] found that the time limit fixed is mandatory and that the Enquiry Report filed beyond the period of 90 days cannot be considered as a valid report and consequently, further proceedings cannot be allowed to go as a follow up action.

No doubt, under the Regulations, it is not specifically stated as to what would follow as a consequence if each and every act contemplated under the Regulations is not done or completed within the prescribed time limit. Merely because the Regulation does not prescribe or spell out expressly or specifically as to what would be the consequence, there could be no presumption that there is no consequence at all in these cases - a broker, whose license is suspended and is not visited with any further order within the time limit prescribed, is undoubtedly deprived of his business endlessly and thus, such hardship detrimental to the interest of the licensee is to be treated and viewed as consequence. Likewise, the revocation of the license or imposing penalty should also be done within the time prescribed so that the customs house agent will be in a position to know where does he stand.

In this case, non compliance of the time limit would certainly affect the interest of the customs house broker and therefore, the above said decisions relied on by the respondents are not applicable to the present facts and circumstances. In other words, it is obvious that by not adhering to the time limit, the substantial right of the licensee to continue the business is affected and therefore, it is evident that only to protect such substantial right, the time limit is prescribed under the regulations and thus, the compliance of the same is mandatory and not directory.

Petition allowed.