TMI Blog2012 (9) TMI 679X X X X Extracts X X X X X X X X Extracts X X X X ..... and thereby actively involved in the fraudulent act in connivance with the exporter. As a name lender to the exporter it caused prejudice to Revenue, making breach of trust and failed to discharge its responsibility under Regulation 13. Affecting the interest of the country was due to reckless and irresponsible behaviour of the Appellant in the course of acting as a CHA licensee. Accordingly interim order of suspension passed by the leaned Commissioner does not appear to be improper since principles of vicarious liability is applicable to the present case in hand - Thus as the Commissioner of Customs who is well placed to understand the role of the CHA in customs area is responsible for the happenings in that area and for the discipline to be maintained thereat and if he takes a decision necessary in accordance with law as an interim measure, Tribunal would ordinarily not interfere on the basis of its own notions of the difficulties likely to be faced by the CHA or their employees. Appropriate SCN be issued levelling charges if any, against the CHA within a period of twelve weeks from the date of receipt of this order, failing which the interim order of suspension shall stand r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed an order vide exparte No. 02/CHA/2011 on 17.6.2011 suspending CHA licence of the appellant with immediate effect and also ordered for surrender for G card and H card at his office immediately. While passing that order, learned authority allowed opportunity of hearing to the appellant on 11.7.2011 under Regulation 20 ( 3) of 2004 Regulations so as to pass further order. 5. Granting opportunity of hearing, learned Commissioner passed the impugned interim order of suspension dated 26.7.2011 holding that the exparte order of suspension dated 17.6.2011 shall continue to operate till further orders. To reach to such conclusion, learned authority viewed that for the breach of law committed by the Appellant, no suspension of its CHA licence may cause further jeopardy to the State. Appellant s plea of no blemish conduct in past was discarded by that Authority for the omission and commission reported by learned Commissioner, Jamnagar and gross violation of law committed by the Appellant. 6. Learned Commissioner, Jaipur examined gravity of the statement of Shri Sanjay N. Gandhi, proprietor of the appellant recorded on 2.6.2011 under Section 108 of Customs Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Cargo Care 2012 (279) ELT 295 (Tri. Del.) 8. Per contra, submissions of the learned representative of Revenue was that granting a lee way to the appellant shall cause obstruction the process of investigation and the appellant shall cause further prejudice to the interest of Revenue. The appellant was subjected to Regulation 22 ( 2) whereby interim suspension of licence was ordered during pendency of the inquiry for good reason. Misconduct of the appellant being patent from its act covered by Regulation 20 ( 1), the administrative order of suspension passed should continue till conclusion of investigation and adjudication under Regulation 20 of 2004 Regulation as without being intervened by Tribunal . Plea of failure to follow the time limit under Regulation 22 has no basis when misconduct under Regulation 20 comes up and Revenue was gravely injured and Offence report is yet to reach to learned Commissioner, Jaipur. Interim suspension was ordered following due procedure of law granting opportunity of hearing when the appellant failed to come out with clean hands. Rather appellant has misplaced the circular without appreciating that circular is not a bar agai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sure to arrest evasion. 12.1 The very purpose of granting licence under Regulation 9 of 2004 Regulations is to authorize a person to act as CHA on behalf of importers and exporters to occasion import and export of goods at any customs station in accordance with the provisions of Customs Act, 1962. In order to discharge such responsibility, the CHA is expected to have basic knowledge of Customs provisions. Regulation 8 of 2004 Regulations requires a person to appear examination conducted by Customs Department to test his capability in the matter of preparation of various documents, determination of value, procedures of assessment, payment of duty and to assess the extent to which he is conversant with the provisions of Customs law and certain other enactments etc. 12.2 Upon qualifying the prescribed examination one becomes eligible to get CHA licence subject to fulfilment of other provisions of Customs Act, 1962. Object of this Act is that CHA should ensure that he does not act as an Agent to carry out illegal activities for any person who avails his services in the matter of import and export and he should also not be a party to the violation of the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cargo or baggage issued by the Commissioner of Customs, from a client who is entitled to such information; (g) Promptly pay over to the Government, when due, sums received for payment of any duty, tax or other debt or obligations owing to the Government and promptly account to his client for funds received for him from the Government or received from him in excess of Governmental or other charges payable in respect of the clearance of cargo or baggage on behalf of the client; (h) Not procure or attempt to procure directly or indirectly, information from the Government records or other Government sources of any kind to which access is not granted by proper officer ; (i) Not attempt to influence the conduct of any official of the Customs Station in any matter pending before such official or his subordinates by the use of threat, false accusation, duress or the offer of any special inducement or promise of advantage or by the bestowing of any gift or favour or other thing of value; (j) Not refuse access to, conceal, remove or destroy, the whole or any part of any book, paper or other record, relating to his transactions as a Custom House Agent which is sought or may be so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of a Custom House Agent and order for forfeiture of part or whole of security or only order forfeiture of part or whole of security, on any of the following grounds namely :- (a) failure of the Custom House Agent to comply with any of the conditions of the bond executed by him under Regulation 10; (b) failure of the Custom House Agent to comply with any of the provisions of these regulations, whether within the jurisdiction of the said Commissioner of Customs or anywhere else; (c) Any misconduct on his part whether within the jurisdiction of the said Commissioner of Customs or anywhere else which in the opinion of the Commissioner renders him unfit to transact any business in the Customs Station. ( 2) Notwithstanding anything contained in sub-regulation (1), the Commissioner of Customs may, in appropriate case where immediate action is necessary, [within fifteen days from the date of receipt of a report from investigating authority, suspend the licence ] of a Customs House Agent where an enquiry against such agent is pending or contemplated. (3) Where a licence is suspended under sub-regulation (2), notwithstanding the procedure specified under regulation 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dering evidence for or against the Customs House Agent, for the purpose of ascertaining the correct position. (4) The Customs House Agent shall be entitled to cross-examine the persons examined in support of the grounds forming the basis of the proceedings, and where the Deputy Commissioner of Customs or Assistant Commissioner of Customs declines to examine any person on the grounds that his evidence is not relevant or material, he shall record his reasons in writing for so doing. (5) At the conclusion of the inquiry, the Deputy Commissioner of Customs or Assistant Commissioner of Customs shall prepare a report of the inquiry recording [his findings and submit his report within ninety days from the date of issue of a notice under sub-regulation (1).]. (6) The Commissioner of Customs shall furnish to the Customs House Agent a copy of the report of the Deputy Commissioner of Customs or Assistant Commissioner of Customs, and shall require the Customs House Agent to submit, within the specified period not being less than [thirty days], any representation that he may wish to make against the findings of the Deputy Commissioner of Customs or Assistant Commissioner of Customs. (7) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing short the investigation in the guise of misconceived notion of limitation would be a mockery. 13. In the present case the offence report is yet to reach to the Commissioner of Customs under Regulation 22(1) and crucial date for counting limitation under Regulation 22 being receipt of offence report by the Commissioner of Customs under Regulation 22(1), that stage has not yet been arrived. Interim suspension order passed is purely an administrative disciplinary measure to prevent CHA to enter into Customs area. Therefore, any intervention to such order of suspension during pendency of investigation shall be detrimental to the process of investigation and shall defeat the object of fair, impartial and independent investigation. 14. The Appellant although claims to have 6 (six) years of experience as CHA, prima facie, it appears to have paved the way for its user of licence to indulge in serious malpractices which would have prejudiced country s interest but for timely detection of the fraud. Therefore, there was every justification on the part of learned Commissioner Customs to treat the action of the applicant as detrimental to the interest of the nation following the ratio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cence. In the present case offence report is yet to be reached. The offence alleged in the present case appears to be gravious in nature and investigation should not be interfered by Tribunal. 15.5 Next reliance of the appellant was in the case of Cargo Care vs. CC, New Delhi 2012 (279) ELT 295 (Tri.-Del.) to submit that when the final notice is not issued, CHA licence is to be restored. In that case Tribunal noticed that even after 28 months of suspension there was no disclosure of evidence for long time to the CHA and abnormal delay of 28 months had occurred. Licence was, therefore, restored as an interim measure without obstructing investigation. But in present case while investigation is in progress and not even one year has expired from the date of passing interim suspension order, appellant cannot get benefit of that order in view of gravity of offence alleged in the present case. 15.6 Learned Counsel for appellant argued that CBEC Circular No. 9/2010 dated 8.4.2010 stipulates the time limit to dispose CHA licence cancellation matter. But that was not followed. In the present case the limitation is yet to run from the date of offence report which is yet to be received b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gainst the order of Commissioner (Appeals), the Division Bench observed that Customs authorities while deciding on the show cause notice could not only take into consideration the reply itself but also effect of the order passed by the Commissioner (Appeals). In the meantime, the Tribunal by an interim order had disposed connected stay application of the party for whom CHA acted and also Tribunal dismissed the appeal of CHA. Against such order of dismissal the CHA went in appeal before Hon ble High Court. It has been held by Hon ble Court in that appeal that: i) CHA licence can be suspended where there is a violation of provisions of the Customs Act, 1962 or there is imposition of penalty and, the power of suspension of licence is not confined to only those situation where there is a violation of CHA LR, 2004 Regulations. ii) CHA licence can be suspended based on confession made under section 108 of the Act provided it is voluntary and the statement is truthful and is not result of such inducement, threat or promise as mentioned in Section 24 of the Indian Evidence Act, 1872. iii) CHA acting on behalf of the importer has not only his obligation to ensure that entries made in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its responsibility under Regulation 13. Affecting the interest of the country was due to reckless and irresponsible behaviour of the Appellant in the course of acting as a CHA licensee. Accordingly interim order of suspension passed by the leaned Commissioner does not appear to be improper since principles of vicarious liability is applicable to the present case in hand. 20. While interim suspension continues due to gravity of the alleged acts of misconduct and the appellant CHA has undergone suffering, it must not be lost sight of that, though it is the right of a citizen to carry on his business or profession, it is subject to reasonable restrictions and conditions which, in the present case, are stipulated under the 2004 Regulations. [ Ref:Worldwide Cargo Movers - 2010 (253) E.L.T. 190 (Bom.)]. When the appellant facilitated misdeclaration of goods and restricted goods were to be exported in the garb of different goods that was a corruption. In cases involving corruption there should not be any lighter punishment. [Ref: State of T.N. v. K. Guruswamy - (1996) 7 SCC 114]. Any sympathy shown in such cases shall be opposed to public interest and Public Policy. The consideration re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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