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2016 (11) TMI 467 - MADRAS HIGH COURT

2016 (11) TMI 467 - MADRAS HIGH COURT - TMI - Revocation of licence - CHA - forfeiture of security deposit - Regulation 20(7) of the Customs Broker Licence Regulations, 2013 - plea of limitation and non-service of notice and orders on the petitioner - Held that: - Department is able to prima facie establish that the petitioner had the knowledge of the proceedings. The petitioner had been prolonging the issue which has been recorded by the respondent in the impugned order, wherein it has been sta .....

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tioner stand rejected and both contentions are answered against the petitioner. Hence, in respect of the other factual contentions that the petitioner may raise challenging the impugned order, it is appropriate that the petitioner should invoke the appellate remedy available under the provisions of the Act. The appellate remedy available to the petitioner is before the Tribunal which is the final Court of fact. The Tribunal is empowered to re-appreciate the factual contentions and come to a corr .....

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e done before this Court at the very inception and that was preciously the reason for the petitioner to restrict their contentions in the Writ Petition on the above two grounds. Likewise, the counter affidavit filed by the respondent was only restricted to those two contentions raised by the petitioner. Therefore, in respect of all other contentions, which the petitioner may raise, have to be necessarily done before the Appellate Tribunal - petition dismissed - it is left open to the petitioner .....

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, J. For the Petitioner : Dr. S. Krishnandh for M/s.B.Satish Sundar For the Respondents : Mrs.Hema Muralikrishnan ORDER Heard Dr. S.Krishnandh learned counsel appearing for Mr.B.Satish Sundar, learned counsel for the petitioner and Mrs.Hema Muralikrishnan learned Senior Panel counsel appearing for the respondent. 2. The petitioner was issued a Customs Broker licence under the Customs House Agent Licence Regulation, 2004,(CHALR), has filed this Writ Petition for issuance of a Writ of Certiorarifi .....

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ined a container at Chennai International Terminal on 20.03.2013, for detailed examination. Before opening the container, the seals affixed in the container were examined in the presence of two independent witnesses, Customs Broker, Licence Agents, Freight Forwarder and CFS Authority, however efforts taken by the department to contact the exporter was in vain, as he could not be traced and stated to be absconding at the relevant time. The DIU team found that the riverts of the seal lock of the c .....

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titioner and after completing the other formalities, the petitioner was called upon to show cause, by show cause notice dated 19.02.2014, as to why their licence should not be revoked and the security deposited by them should not be forfeited or penalty should not be imposed upon them under Regulation 18 of the CBLR, for the failure to comply with the provisions of the Regulations. An Inquiry Officer was appointed to inquire into the grounds, which were not admitted by the petitioner. The respon .....

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[in terms of Regulation 20(a)]; failed to comply with the provisions of 13(a), 13(b), 13(d) and 13(e), in terms of Regulation 20(b) of CHALR and proved professional misconduct and indulged in breach of trust reposed on them. The copy of the inquiry report was forwarded to the petitioner on 08.01.2015, with a copy marked to the counsel for the petitioner. Thereupon, the counsel for the petitioner submitted a reply dated 21.01.2015, stating that the show cause notice or inquiry report has not been .....

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artment about their change of address along with a copy of rental agreement of their new address which was duly received and acknowledged. Thus, it was their submission that despite the receipt of the intimation of change of address of the business premises, all communications were sent to the old address and there was no way that the petitioner could have received the same and responded to the said communications. Therefore, it was submitted the inquiry culminating in a report, dated 31.12.2014 .....

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ated the written submissions, dated 21.01.2015, and sought for setting aside the inquiry report requesting a fresh hearing in the matter and also informed that the proceedings are pending before the CESTAT with regard to the order extending the suspension of the petitioner's Customs Broker Licence. On these contentions, the respondent while adjudicating the show cause notice and passing the impugned order recorded that the copy of the order of suspension, dated 17.05.2013, under Regulation 2 .....

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s passed and the same was sent to the petitioner at the above referred address, which was received by them on 16.06.2013, again in person and aggrieved by such order, the petitioner has preferred an appeal to the CESTAT on 10.07.2013. In the appeal memorandum filed before the CESTAT, the address of the petitioner has been given as No.181, Linghi Chetty Street, First Floor, Chennai 600001 and the same is the address in the statement of facts, as well. While stating that it may be true that the pe .....

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ed on 10.02.2011, however, as late as 10.07.2013, the petitioner showed the address at No.181, Linghi Chetty Street, First Floor, Chennai 600001, as their address in the appeal before the CESTAT. Thus, the respondent concluded the petitioner is very well operating at the same premises and at such distant point of time, raising such contention, is not tenable, as they have received the order-in-original in person. Thus, the contention raised by the petitioner was rejected, as it appeared to be a .....

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was issued on 19.02.2014 and inquiry report was submitted on 13.02.2014 and based on which, the case was adjudicated by the respondent and impugned order was passed on 11.06.2015. 5. The learned counsel argued that in terms of Regulation 20(1) of the CBLR, the show cause notice issued was well beyond the period of 90 days from the date of receipt of the offence report, as it was issued after a lapse of nine months. By referring to Regulation 20(5), it is submitted that the inquiry report should .....

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the contention raised by the petitioner is that commencing from the issuance of the order of immediate suspension culminating in the impugned order revoking the licence, the entire proceedings are barred by limitation. In support of such contention, reliance was placed on the decision of the Hon'ble Division Bench in the case of The Commissioner of Customs (Imports), & Anr., vs. M/s.A.M.Ahmed & Co., in W.A.No.371 of 2015, dated 02.07.2015, and the decisions of the Delhi High Court i .....

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-TIOL-1135-HC-DEL-CUS. 7. The learned counsel further referring to the letter given by the petitioner intimating the change of address to the Deputy Commissioner of Customs, CHA Units, Chennai Customs House, dated 10.02.2011, submitted that the change of address was intimated on the said date enclosing copy of the rental agreement and acknowledged by concerned department. Therefore, the petitioner did not receive any such communication from the department. Further, the respondent cannot reply up .....

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for the petitioner, with liberty to file a detailed counter affidavit, if a need arises at a later point of time. 8. As only two contentions were raised by the petitioner, as mentioned, this Court examined the correctness of the impugned proceedings only on two grounds, which have been urged before the Court namely on the ground of limitation and non-service of notices and orders on the petitioner. With regard to the plea of limitation, the respondent would submit that the case of the petitione .....

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invoking the power under Regulation 20(2) of the CHALR, 2004, after which the inquiry was conducted. Referring to Regulation 22 of the CHALR, it is submitted by the respondents that the said Regulation stipulates the procedure for suspending or revoking licence under Regulation 20 and Regulation 22 of the CHALR does not specify any time limit of 90 days for issuance of show cause notice and Regulation 22(1) of the CHALR provided for granting time of not less than 45 days to the Customs House Ag .....

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er-session. Therefore, it is submitted that the 2013 CBLR will apply to all cases except in respect of things done under CHALR before super-session of CHALR and in the present case proceedings for suspension or revocation were initiated under Regulation 22 of the CHALR, 2004. Therefore, the impugned proceedings being in continuation of the proceedings initiated under CHALR is valid and not barred by limitation. 10. With regard to the plea that copies of the notices, inquiry report, orders were n .....

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Linghi Chetty Street, First Floor, Chennai 600001, i.e., the original address of the petitioner and even in the appeal filed by the petitioner before CESTAT, the same address has been given. Therefore, it is submitted that it is incorrect on the part of the petitioner to contend that the notices were sent to the old address and not received by them. Adding to the above submission, it is submitted that even though the petitioner claims that it changed the place of business in 2011, the order of .....

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to consider the two aspects, which was argued before this Court challenging the impugned order namely, limitation and non-service of notices and orders, it would be necessary to take note of the relevant regulations namely, CHALR 2004 and CBLR 2013 and the following would be relevant:- 20. Suspension or revocation of licence.- (1) The Commissioner of Customs may, subject to the provisions of regulation 22, revoke the licence of a Customs House Agent and order for forfeiture of part or whole of s .....

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Customs or any where 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 cases 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 licen .....

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ing or revoking licence under Regulation 20.- (1) The Commissioner of Customs shall issue a notice in writing to the Customs House Agent within ninety days from the date of receipt of offence report, stating the grounds on which it is proposed to suspend or revoke the licence and requiring the said Customs House Agent to submit within thirty days to the Deputy Commissioner of Customs or Assistant Commissioner of Customs nominated by him, a written statement of defense and also to specify in the .....

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ce referred to in sub-regulation (1), direct the Deputy Commissioner of Customs or Assistant Commissioner of Customs to inquire into the grounds which are not admitted by the Customs House Agent. (3) The Deputy Commissioner of Customs or Assistant Commissioner of Customs shall, in the course of inquiry, consider such documentary evidence and take such oral evidence as may be relevant or material to the inquiry in regard to the grounds forming the basis of the proceedings, and he may also put any .....

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or 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 .....

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r Assistant Commissioner of Customs, under sub-regulation (5). (8) Any Customs House Agent aggrieved by any decision or order passed under regulation 20 or sub-regulation (7) of regulation 22, may prefer an appeal under section 129A of the Act to the Customs, Central Excise and Service Tax Appellate Tribunal established under sub-section (1) of section 129 of the Act. CBLR:- In Exercise of the powers conferred by sub-section (2) of section 146 of the Customs Act, 1962 (52 of 1962), and in super .....

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Regulation 20(2) commence with an non obstante clause, confers power on the Commissioner of Customs to suspend the license with immediate effect when an inquiry against such agent is pending or contemplated. This power if invoked requires a post decisional opportunity being granted to the licensee within 15 days of such suspension giving opportunity of hearing and make such order either revoking the suspension or continuing the same. 14. Regulation 22 deals with the procedure to be followed, whi .....

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bes a time limit within which notice should be issued and the time within which inquiry has to be completed, report to be submitted and the time within which action has to be initiated. Thus, by applying the said Regulation 20 of the CBLR, it is submitted that the entire proceedings are vitiated. However, the most important aspect which has to be taken note is that while notifying CBLR vide notification dated 21.06.2013 it was stated that the same has been made in exercise of the powers conferre .....

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age and set aside the order in original without relegating the petitioner to prefer an appeal before the Tribunal does not merit consideration. The petitioner cannot dispute the fact that the CHALR does not prescribe any time limit for action being initiated and their contention is solely based upon the new Regulations CBLR, 2013, which is inapplicable. 15. Furthermore, the petitioner would place reliance on a circular issued by CBEC dated 08.04.2010 by which the Board prescribed certain time li .....

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ry relevant while examining as to whether the Department should be non-suited on the ground of delay. This finding is recorded bearing in mind that the fact CHALR, does not provide for a time limit for action being taken. What is stressed upon is circular issued by the CBEC. Even the said circular dated 08.04.2010 has been carefully worded and this is evident from the use of the expression ".... wherever it is possible to do so......". Further the circular states that the difficulties .....

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ivered. 16. With regard to the contention that the petitioner had intimated his change of address, the respondent has taken a stand that the order of suspension dated 17.05.2013 was received by the petitioner at the old address. Therefore, the Department would contend that the petitioner's plea that notices sent to the old address are not received by them is an incorrect plea, which plea by the respondent merits acceptance. Thus, on the petitioner's own showing that even though they are .....

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pear for personal hearing offered to them by the Inquiry Officer on 17.10.2014, 27.10.2014 and 28.10.2014 and did not make any oral or written submissions. Therefore, the Inquiry Officer was left with no option except to give a report based on the available records. The report concludes that the petitioner has not followed the norms prescribed by various circulars issued by CBEC and failed to comply with the provisions of CHALR, 2004 and committed professional misconduct and indulged in breach o .....

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he same address. While adjudicating the show cause notice and passing the impugned order, the respondent has specifically recorded that there is no mention about the change of address at the time of personal hearing on 27.05.2013 or in the petitioner's written submission dated 29.05.2013. The order of continuation of suspension dated 14.06.2013 was received by the petitioner in person on 16.06.2013. Aggrieved by which the petitioner preferred an appeal before the CESTAT and in the appeal, ad .....

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and non-service of notice and orders on the petitioner stand rejected and both contentions are answered against the petitioner. Hence, in respect of the other factual contentions that the petitioner may raise challenging the impugned order, it is appropriate that the petitioner should invoke the appellate remedy available under the provisions of the Act. The appellate remedy available to the petitioner is before the Tribunal which is the final Court of fact. The Tribunal is empowered to re-appr .....

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