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M/s. D.V.R. Freight Forwarders Pvt. Ltd., Shri R. Saravana Kumar Versus The Commissioner of Customs (Seaport-Import) , The Inquiry Officer/ Deputy Commissioner of Customs

2015 (8) TMI 729 - MADRAS HIGH COURT

Suspension of CHA License Non-Compliance of Regulation, 2013 Respondent-1 suspended licence of petitioners by invoking Regulation 19(1) of Regulations, 2013 on alleged involvement of petitioner in evasion of duty by various importers Thereafter, show cause notice was issued proposing to revoke licence of petitioner under provisions of Regulation 18 Vide impugned order licence of petitioner was revoked and forfeiture of amount of security deposit was ordered Held that:- Admittedly petit .....

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rder to interfere with impugned order

Therefore, in view of existence of the aforesaid alternative remedy, this Court is not inclined to exercise its extraordinary power under Article 226 of the Constitution of India. Accordingly, this writ application fails and is dismissed. Decided against the petitioner. - Writ Petition No. 28921 of 2014 And M.P.No.1 of 2014 - Dated:- 15-7-2015 - The Honourable Mr. Justice S. Vaidyanathan,J. For the Petitioner : Mr. Hari Radhakrishnan For the Res .....

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s M/s.Lucky International, Chennai, M/s.Kannan Printing Solutions, Melmaravauthur, who had imported PVC flex banners from Malaysia. The officers of the Directorate of Revenue Intelligence, Chennai had commenced investigation into these imports on the intelligence that these importers were misdeclaring the country of origin of the imported PVC Flex banners as Malaysia instead of China for evading anti-dumping duty. The Government had imposed anti-dumping duty on PVC flex banners imported from Chi .....

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irst respondent passed order, dated 12.12.2013, ordering continuation of suspension of the licence of the petitioner under Regulation 19(2) of CBLR, 2013 and also issued a show cause notice dated 12.12.2013 proposing to revoke the licence of the petitioner under the provisions of Regulation 18 of CBLR, 2013. 2. Challenging the order of suspension of the licence was continued, dated 12.12.2013, the petitioner has filed a writ petition before this Court in W.P.No.35318 of 2013, which was disposed .....

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g that the allegation of violation of Regulation 11(d) and 18(c) stood proved. The petitioner submitted a reply to the enquiry report on 26.08.2014. On consideration of the said report as well as the reply of the petitioner, the first respondent passed the impugned order, dated 21.10.2014 revoking the licence of the petitioner and also ordered forfeiture of the amount of security deposit made by the petitioner. Aggrieved by the same, the petitioner has come forward with the present writ petition .....

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ities were found, viz., that the Director of the petitioner being the holder of the customs brokers license, encouraged his relatives and friends and obtained IECs in their names and provided those IECs to one Kamalesh Jain of M/s.J.K.Enterprises to import PVC flex banners for monetary consideration for the IEC holders with an intention to get more business for himself; that the customs broker facilitated clearance of PVC flex banner consignments imported by Sailesh Jain using the IECs of M/s.An .....

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ods to godowns indicated by Shri Sailesh Jain, thereby facilitated the perpetrators in the said customs fraud; that the customs broker received the charges towards customs clearance of the said consignments from Shri Sailesh Jain in cash and not from the IEC holders; and that the customs broker never brought this illegal activity to the knowledge of customs and actively colluded with Shri Sailesh Jain in the conspiracy. 4. Hence, it was found that there had been lapses on the part of the Customs .....

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issioner of Customs of Assistant Commissioner of Customs and also paved way for mis-declaration of value, weight and Country of Origin to avoid payment of legitimate customs duty including anti-dumping duty, which led to huge duty evasion. Hence, the Customs Broker filed to comply with the provisions of Regulation11(d) of the CBLR, 2013; c. As per Regulation 11(a) of the CBLR, 2013, the customs Broker should verify antecedent, correctness of Importer Exporter Code (ICE)number, identity of his cl .....

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al misconduct and indulged in breach of trust reposed upon him in good faith. (Reference Regulation 18 (c) of the CBLR, 2013) In view of the above, it was found that a clear prima facie case exists against the Customs Broker M/s. DVR Freight Forwarders Pvt. Ltd., the petitioner herein and if the Customs Broker is allowed to continue to operate it would be detrimental to the interest of revenue and, therefore, it was necessary to take immediate action against the said Customs Broker, to prevent t .....

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written submissions, it is found that Customs Broker has made general arguments against the suspension order and not submitted any evidence to show that they had acted in a bonafide manner as a Customs Broker. Hence, it was found that the Customs Broker had failed to fulfill the condition of the Bond executed by him under Regulation 10 of the CHALR, 2013 (now Regulation 8 of the CBLR, 2013), and failed fulfill the obligations cast upon him under Regulation 11(a), 11(d) and 11(n) of the CBLR, 201 .....

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e revoked and security deposited by them should not be forfeited or penalty should not be imposed upon them under Regulation 18 of the CBLR, 2013, for their failure to comply with the provisions of CBLR, 2013. An inquiry officer in the rank of Deputy Commissioner, has also been appointed to conduct inquiry into the case under Regulation 20 of the CBLR, 2013. The Customs Broker M/s. DVR Freight Forwarders Pvt Ltd., Chennai approached the Hon ble High Court and filed writ petition praying for issu .....

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ry report stating that all the ingredient of natural justice are thoroughly followed starting from issue of Show Cause Notice, waiting for reply for the notice, allowing examination of the witnesses, granting Personal hearing and then allowing them to file their final reply. Inquiry Officer vide his report has reported that the charges of violation of Regulation 11(a) & 11(n) of CBLR, 2013 stands not proved and however holds the charges of violation of Regulation 11(d) and 18(c) of the CBLR, .....

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R, 2013, by proceedings, dated 20.10.2014 has revoked the licence and also ordered for forfeiture of the security deposit. Therefore, it is stated that after conducting a full-fledged enquiry by following the principles of natural justice in providing personal hearing and since the charges were found proved against the petitioner, the impugned order has been rightly passed by the first respondent, which needs no interference. With these averments, the respondents sought for dismissal of the writ .....

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oms authorities and had he informed, the illegal imports of Flex sheets of Chinese origin through Malaysia made by said Sailesh Jain of M/s.J.K.Enterprises evading legitimate customs duty including anti-dumping duty would have been detected earlier. Hence the charge of not informing the department of the issue of hiring of IEC stands proved and thereby, the petitioner violated the provisions of Regulation 11(d) of the Act and that Shri R.Saravana Kumar has admitted to have received an amount of .....

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oker has not produced before the DRI the authorization said to have been obtained from all the imports at the time of investigation and therefore, as evidence in the investigation report and from the statement of R.Saravana Kumar under Section 108 of the Act, the violation of Regulation 11(a) stands proved. Therefore, for the proven charges, the first respondent, while exercising the powers conferred under the provisions of Regulation 20(7) of the CBLR, 2013, ordered revocation of license of the .....

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by misdeclaring the country origin and the allegation that the misuse of the IEC has facilitated illegal imports is premature as no order has been passed holding the importers liable for mis-declaration of country of original to evade anti-dumping duty and hence the show cause notice to the customs broker is premature and it did not give an impression that the customs broker would get an effective opportunity to rebut the allegation contained in the show cause notice and prove innocence. In thi .....

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show cause notice has been issued to the importer alleging that they had mis-declared the country origin to evade anti-dumping duty. The learned counsel also contended that lending/misusing the IE Code is not an offence under the Customs Act and therefore, even assuming that the petitioner facilitated the misuse of the IE Code, the first respondent has no jurisdiction to suspend the petitioner s licence. He relied upon a decision in Hamid Fahim Ansari versus C.C.(I) reported in 2009 (241) ELT 16 .....

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and on completion of the enquiry, the Enquiry Officer filed his report on 24.7.2014, for which, the petitioner was given opportunity to file their reply and on 26.8.2014, the petitioner has filed the report. After considering the reply, the first respondent has passed the impugned order revoking the license of the petitioner. Therefore, having made replies to the show cause notice and to the report of the Enquiry Officer and having participated in the enquiry, it is not appropriate for the petit .....

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oms law is a complete code by itself.The Customs Actand the Rules and bye-laws framed thereunder constitute a comprehensive and exhaustive code. The impugned order in the instant case has been passed by the Commissioner of Customs (Imports) in exercise of his power under the Customs Brokers Licensing Regulations, 2013 which are framed under Article 146(2) of the Customs Act, 1962. Regulation 21 provides that a Customs Broker who is aggrieved by any order passed by the Commissioner of Customs und .....

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e statutory authority. The task of the writ Court to examine the decision-making process was found in the decision reported in State of UP versus Maharaja Dharmedar Prasad Singh reported in AIR 1989 SC 997. The writ Court is averse to interfere with the acts and actions of the statutory authorities unless those are beyond jurisdiction or in excess of jurisdiction. The Writ Court will certainly interfere if the impugned orders are contrary to the principles of natural justice causing effect manif .....

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e with the provisions of the enactment in question, or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed, or when an order has been passed in total violation of the principles of natural justice causing prejudice to the aggrieved party. 15. In Titaghur Paper Mills Co.Ltd. versus Stae of Orissa reported in (1983) 2 SCC 433, a three Judges Bench of the Hon'ble Supreme Court held that where an Act provides for a complete .....

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