TMI Blog2018 (1) TMI 1185X X X X Extracts X X X X X X X X Extracts X X X X ..... fied under Regulation 20(2) of the CBLR. A Custom Broker cannot carry on its business without a License and, therefore, revocation or suspension of such License has serious adverse consequences as it results in preventing the Customs Broker from carrying on its vocation. Given the serious nature of such action, strict timelines have been specified under Regulations 19 and 20 of the CBLR and the same must be adhered to. Petition allowed - decided in favor of petitioner. - W.P.(C) 9083/2015 - - - Dated:- 15-1-2018 - MR VIBHU BAKHRU J. Advocates who appeared in this case: For the Petitioner: Mr Manish Kaushik. For the Respondent: Mr Amit Bansal and Mr Akhil Kulshrestha. JUDGMENT VIBHU BAKHRU, J 1. The petitioner has filed the present petition, inter alia, assailing an order dated 18.03.2015 (hereafter the impugned order ) passed by the Commissioner of Customs (hereafter the respondent ) confirming the suspension of the petitioner s Custom House Agents License (hereafter the License ) under Regulation 19(2) of the Customs Brokers Licensing Regulations, 2013 (hereafter the CBLR ). 2. The petitioner claims that although its License has been su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... front to perpetuate the fraud. The respondent was informed that the role of Custom Brokers had also been examined and it was, inter alia, found that the petitioner had also filed SBs for M/s. Vee Dee Textiles and M/s S.S. Exports, which were suspected to be highly overvalued. 3.6 The office of the petitioner was searched by the officers of DRI on 21.01.2015, whereby records pertaining to the export of certain clients were seized. 3.7 Sh. Rajiv Sharma, Director of the petitioner was summoned vide Summons dated 13.02.2015, to appear before the Senior Intelligence Officer (hereafter SIO ), DRI on 16.02.2015. He appeared before the SIO in compliance with the aforesaid summons. He was again served with the summons on 16.02.2015 to appear before the SIO, DRI on 18.02.2015 and his request that the hearing be deferred to some other date as his mother was to be operated on 19.02.2015, was rejected. 3.8 On the basis of the information received, the respondent passed an order dated 25.02.2015 under Regulation 19(1) of the CBLR suspending the petitioner s License as according to the respondent, it appeared that the petitioner had contravened various provisions of the CBLR including R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tigation by the DRI and neither any offence report has been received nor any show cause notice has been issued pursuant to the said investigations. He submitted that since the investigations are still underway, no offence report has been generated as yet. He submitted that since the respondent has not received an offence report as yet, the time period as prescribed under Regulation 20 of the CBLR has not yet commenced. He further submitted that the time limit specified under the Regulations can only be taken to be directory and not mandatory. 7. Before proceeding further, it would be necessary to refer to Regulation 19 and 20 of the CBLR, which are set out below:- 19. Suspension of license: (1) Notwithstanding anything contained in regulation 18, the Commissioner of Customs may, in appropriate cases where immediate action is necessary, suspend the licence of a Customs Broker where an enquiry against such agent is pending or contemplated. (2) Where a licence, is suspended under sub-regulation (1), the Commissioner of Customs shall, within fifteen days from the date of such suspension, give an opportunity of hearing to the Customs Broker whose licence is suspended ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Customs Broker or imposing penalty not exceeding the amount mentioned in regulation 22 within ninety days from the date of submission of the report by the Deputy Commissioner of Customs or Assistant Commissioner of Customs, under sub-regulation (5): Provided that no order for revoking the license shall be passed unless an opportunity is given to the Customs Broker to be heard in person by the Commissioner of Customs. 8. A plain reading of Regulation 19(1) of the CBLR indicates that the Commissioner of Customs may in appropriate cases where immediate action is necessary, suspend the License of Customs Broker. It is apparent that such action can be taken only where: (i) immediate action is necessary; and (ii) an inquiry against the agent is pending or contemplated. Regulation 19(2) of the CBLR further specifies that where the License of Customs Broker is suspended under Regulation 19(1) of the CBLR, the Commissioner of Customs is required to afford an opportunity of being heard to the Customs Broker within a period of fifteen days thereof and is further required to pass an order either revoking the suspension or continuing it within fifteen days from the date of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imposing a penalty. Thus, the proceedings once commenced must inevitably conclude with either revocation of a Customs License or the License issued to the Customs Broker and/or imposing a penalty, or the proceedings being dropped against the Customs Broker. Clearly, the order of suspension cannot be permitted to be continued indefinitely. 13. In Commissioner of Customs (Sea Port, Import), Chennai v. CESTAT (supra), the Division Bench of the Madras High Court had also observed as under:- 33. The compliance of procedure under Regulation 20 would not tantamount the compliance of Regulation under 22 and therefore, the substantial questions of law raised in these appeals are answered in negative against the appellant in these appeals. In the result, all these Civil Miscellaneous Appeals are dismissed, confirming the orders dated 10.10.2013 in Final Order No. 40461/2013 and the orders dated 12.11.2013 in Final Order No. 40566 to 40569 of 2013 respectively on the file of the Customs, Excise and Service Tax Appellate Tribunal, Chennai Bench, Chennai. No costs. Consequently, the connected miscellaneous petition is closed. 14. The order of suspension by its very nature is an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fteen days of the receipt of the report of the investigating authority. A post-decisional hearing shall be granted to the party within fifteen days from the date of his suspension. The Commissioner of Customs concerned shall issue an Adjudication Order, where it is possible to do so, within fifteen days from the date of personal hearing so granted by him. 16. A plain reading of the aforesaid passage indicates that the expression offence report as used in Regulation 20(2) of CHALR, 2004 was understood as a report regarding detection of an offence. 17. In the present case, the respondent had received a letter dated 16.02.2015 from ADG(HQ), DRI, New Delhi indicating that an investigation had been undertaken with regard to certain exporters, which had indicated that the goods exported had been overvalued by more than fifteen times in order to claim Duty Drawback and Focus Product Scheme Benefits. The premises of various exports and Customs Brokers (had also been including that of the petitioner) were also searched. The statement of Shri Rajiv Sharma, Director of the petitioner had also been recorded under Section 108 of the Customs Act, 1962. The said facts have been noticed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it a report. The Deputy Commissioner of Customs/Assistant Commissioner of Customs is further required to submit the report within a period of ninety days from the date of issue of the notice under Regulation 20(1) of the CBLR. 20. In terms of Regulation 20(6) of the CBLR, the report of the Deputy Commissioner of Customs/Assistant Commissioner of Customs is required to be furnished to the Customs Broker requiring him to make a representation within a period of thirty days, thereafter. 21. In terms of Regulation 20(7), the Commissioner of Customs is required to pass a final order within the period of ninety days of the receipt of the report of the Deputy Commissioner of Customs/Assistant Commissioner of Customs under Regulation 20(5) of CBLR. Thus, within a period of 270 (two hundered and seventy) days from the receipt of the offence report, the Commissioner of Customs has to pass an order either revoking the order of suspension or to revoke the License of the Customs Broker and/or impose a penalty as specified under Regulation 20(2) of the CBLR. 22. A Custom Broker cannot carry on its business without a License and, therefore, revocation or suspension of such License has se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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