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2015 (8) TMI 627 - GUJARAT HIGH COURT

2015 (8) TMI 627 - GUJARAT HIGH COURT - 2016 (331) E.L.T. 519 (Guj.) - Prohibition to work as CHA – Non-payment of Duty – Non-compliance of Regulation, 2004 – Goods were cleared, however, importer had not paid duty and therefore, respondent No. 2 issued show cause notice to importer as well as Custom House Agent-petitioner – By impugned order of respondent No.2, petitioner was prohibited to work as Customs House Agent under regulation 21 of Regulations, 2004 – Held that:- admittedly applicabilit .....

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n if there were no specific provisions under Regulations – Citizen cannot be denied his rights to carry out his business for indefinite period on those grounds and on same set of facts when proceedings were going on before same authority – Hence, petition was required to be allowed –Impugned order prohibiting work hereby quash – Decided in favour of Petitioner. - SPECIAL CIVIL APPLICATION NO. 7072 of 2015 - Dated:- 23-7-2015 - MR. A.J.DESAI AND MR. A.G.URAIZEE, JJ. FOR THE PETITIONER : MR PARESH .....

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titioner No.1 have prayed as under: [A] That Your Lordships may be pleased to issue a writ of certiorari or any other appropriate writ order or direction quashing and setting aside order F.No.VIII/1308/ CusT/ CB/201415 dated 28.02.2015 9read with Corrigendum dated 11.03.2015) (Annexure - 'F') with consequential reliefs and benefits to the petitioner company; [B] That Your Lordships may be pleased to issue a writ of mandamus or any other appropriate writ, direction or order thereby direct .....

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as a CHA at Customs House, Pipavav thereby staying implementation and execution of order F.No.VIII/1308/ CusT/ CB/201415 dated 28.02.2015 9read with Corrigendum dated 11.03.2015) (Annexure - 'F') [D] An exparte adinterim relief in terms of Para 17(C) above may kindly be granted. 4. Pursuant to notice issued by this Court, respondent No. 2 has filed two affidavits in reply dated 06.05.2015 and 14.07.2015 opposing grant of any relief prayed by the petitioner. 5. Brief facts arise from the .....

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the respondent authority i.e. Assistant Commissioner of Customs, Pipavav for clearance of the containers on payment of duty since the said importer wanted the containers to be sold in domestic market instead of reexporting as per his undertaking (bond). It was requested that the company be permitted to allow to sell those containers in domestic market on payment of duty and the clearance be made against the payment of custom duty. It was further clarified that petitioner No. 1, who is Customs H .....

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Customs Act, 1962 (herein after referred to as 'the Customs Act' for short) and under the provisions of Customs House Agents Licensing Regulations, 2004 (herein after referred to as 'the Regulations, 2004' for short) and particularly, for the violation of Regulation 13(e) of the Regulations, 2004. Noticee were called upon to file their reply within a period of 30 days from the date of receipt of the said notice. As far as the petitioner is concerned, the corrigendum dated 19.02. .....

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se, Pipavav under regulation 21 of the Regulations, 2004. Hence, this petition. 6. Mr. Paresh M. Dave, learned advocate for the petitioner would submit that the petitioner has acted, as far as the import of the containers in the present case is concerned, only when the importer had requested the authority and shown his willingness to pay the duty since he wanted to sell the goods in the domestic market. He would submit that he has worked as the agent for filing of bill of entry with regard to th .....

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re, the order impugned is bad in law. He would further submit that the respondent authority has not given an opportunity of hearing to the petitioner before passing of the order and the petitioner had no option to plead his case before the authority. He would further submit that the petitioner has been issued licence under the Regulations 3 and 4 of the Regulations, 2004 by Customs Office situated at Mumbai and therefore, the authority only has power to take action against the present petitioner .....

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nly by the Mumbai authority. He would further submit that the order impugned is passed under regulation 21 of the Regulations, 2004 prohibiting the petitioner to work as Customs Agent. However, before passing the order impugned, the petitioner has not been called for or heard and there was no occasion for the petitioner to put forward his case before the authority. He would further submit that the order dated 28.02.2015 has been passed under Regulation 21 of the Regulations, 2004 on ground of br .....

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g an opportunity of hearing to the petitioner. He would further submit that even the order is passed in the month of February, 2015 neither Jamnagar authority, who has issued notice in the month of January, 2015 to the petitioner, has proceeded with the case nor the Mumbai authority has initiated any proceedings under Regulation 20 of the Regulations, 2004 therefore, the petitioner is facing serious difficulties and the order impugned, which is of a permanent nature, comes in the way of the peti .....

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s, 2004 empowers the Commissioner to suspend / revoke the licence prescribed under the provision of Regulation 22 of the Regulations, 2004. However, prohibiting from carrying out any activities as the Custom House Agent, there is no procedure prescribed and therefore, the order, which has been passed with a view to take immediate steps against the Agent, who has not followed the obligations referred in Regulations, 2013, the order has been passed. He would further submit that by the impugned ord .....

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and perused the documents produced by the petitioner and notice as well as order impugned. 10. It is an undisputed fact that the containers, which were to be reexported by the importer, were exempted from the payment of duty under the notification dated 16.03.1994. Since the petitioner did not reexport the same within a period of six months, he requested the respondent authority to permit him to sell the same in the domestic market on payment of duty. A letter dated 16.05.2013 makes it very clea .....

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how cause notice reads as under: 16. Now, therefore, M/s. Fourcee Infrastructure Equipment Pvt. Ltd., having their office at Laxmi Mall, Laxmi Indstrial Estate, New Link Road, Andheri (W), Mumbai, Shri Rajesh Vihalka, Chairman of the said party and CHA M/s. SSS Sai Shipping Pvt. Ltd., are hereby called upon to show cause notice to the Commissioner of Customs (Preventive), Jamnagar having her office at Sharda House, Opp. Panchavati, Bedi Bunder Road, Jamnagar, within 30 days from the date of rece .....

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provisional assessment, read with proviso to Section 28(4) of the Customs Act, 1962 read with Section 12 ibid in respect of 100 containers seized as CWC, Kalamboli, from M/s. Fourcee Infrastructure Equipment Pvt. Ltd., for the goods imported under Notification No. 104/1994, and for misusing the said Notification; [iii] the interest of the aforesaid Customs Duty should not be demanded under Section 28AA of the Customs Act, 1962; [iv] penalty should not be imposed on M/s. Fourcee Infrastructure Eq .....

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not be initiated. 11. So far as Para - 16 of the notice is concerned, the present petitioner was called upon to reply for alleged breach of regulation 13(e) of the Regulations, 2004. The petitioner was also asked to reply for not imposing penalty under the provision of Section 114 of the Customs Act. 12. The corrigendum dated 09.02.2015 reads as under : CORRIGENDUM Sub : Show Cause Notice No.VIII/10240/ Commnr/O&A/2014 dated 29.01.2015 issued to M/s Fourcee Infrastructure Equipments Pvt. Lt .....

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ss upon the party to pay the Customs duty due on them within the stipulated time along with interest. As per the Regulation 13(2) of Customs House Agents Licensing Regulations, 2004, a Custom House Agent shall exercise due deligence to ascertain the correctness of any information which he imparts to a client with reference to any work related to clearance of cargo or baggage. As mentioned above, the CHA failed to guide the party to pay up the Customs duty within the stipulated time period of fil .....

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the customs work failed to advice M/s. Fourcee Infrastructure Equipments Ltd., about the provisions of the Notification No. 104/94. Later on when the party filed the Bills of entry, CHA, failed to impress upon the party to pay the Customs duty due on them within the stipulated time along with interest. Also CHA failed to advise noticeeto comply with the provisions of the Act. In case of noncompliance, the CHA shall bring the matter to the notice of the department. As per the Regulation 13(d) and .....

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A failed not only to guide the party to pay up the Customs duty within the stipulated time period of filing the Bills of entry but also failed to bring the matter to the notice of the department, which resulted in loss of revenue to the extent of ₹ 4,14,07,451/. For the Acts ommission and commissioner on the part of CHA, they rendered themselves liable for penalty under Section 114A of the Customs Act, 1962. Also separate action against the CHA, M/s. SSS Sai Shipping Lines, should be initi .....

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n for violating Regulation 13(e) of the Customs House Agents Licensing Regulations, 2004 should not be initiated; The following shall be substituted (vi) penalty should not be imposed on the Customs House Agent, M/s. SSS Sai Shipping Lines under Section 114A of the Customs Act, 1962 and separate action for violating Regulation 13 (d) and 13(e) of the Customs House Agents Licensing Regulations, 2004 (now Regulation 11(d) and 11(e) of the Customs Brokers Licensing Regulations, 2013), should not be .....

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(e) of the Regulations, 2004, which are in Paras - 13 and 14 of the order impugned, which read as under: 13. Further, M/s. SSS Sai Shipping Lines, CHA engaged in the customs work failed to advice M/s. Fourcee Infrastructure Equipments Ltd., about the provisions of the Notification No. 104/94. Later on when the party filed the Bills of entry, CHA failed to impress upon the party to pay the Customs duty due on them within the stipulated time along with interest. As per the Regulation 13(d) and 13( .....

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he CHA failed not only to guide the party to pay up the Customs duty within the stipulated time period of filing the Bills of entry but also failed to bring the matter to the notice of the department, which resulted in loss of revenue to the extent of ₹ 4,14,07,451/. In view of the above, the said CHA has failed to fulfill the obligation under Regulation 13(d) and 13(e) of the CHALR, 2004 and thereby rendered themselves liable for action under the provisions of CHALR, 2004. 14. In view of .....

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rk at the Customs House Pipavav in terms of Regulation 21 of the CHALR, 2004. 14. If the regulation 13(d) and 13(e) of the Regulations, 2004 are perused, the question with regard to the alleged breach of obligations by the petitioner is pending before the authority pursuant to show cause notice dated 29.01.2015 and relying the same ground, which is yet not been finalized, the impugned order has been passed and the petitioner has been prohibited to work as Customs House Agent. The operative part .....

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