2013 (12) TMI 987 - AT - Customs

Stay application - Suspension of CHA License - Violation of Regulation 20(2) of CHALR - Held that - formal authorisation is not essential where the importer who has imported goods does not contradict the CHA and does not say he has not authorised CHA to act on his behalf. The only difference in this case is that the CHA initially stated that he was not authorised but subsequently produced some letters. It is not known from where they came from, how they came from and why they were produced. Since the suspension has to be followed by proper enquiry, these aspects have to be looked into. Prima facie appellant have been able to make out a case that the contravention of Regulation 13(a) is arguable and requires consideration in detail and conclusion reached by the Commissioner may be sustainable or may not be sustainable. There is no admission by the CHA that he has not advised the importer and also there is no admission by the importer that he was not advised by the CHA. It is not clear on what basis the learned Commissioner has reached the conclusion that CHA has not given the advice and thereby violated the provisions. The ground taken by the learned Commissioner is that one IEC is of Jamnagar and another is of Mehsana and Shri Sachin Shah was in Bombay. Once the facts emerging from the records show that Shri Sachin Shah was importer and he has faced consequences for misuse of IEC, a view can be taken, that it was Shri Shah who should have been advised, who was dealing with CHA. In the absence of any evidence to show that Shri Shah has not been advised, prima facie the contravention of this regulation does not appear to be sustainable - Stay granted.

Summary

Issues:
1. Early hearing applications for suspension of CHA license.
2. Suspension of license under CHALR 20(2) based on a report from Deputy Commissioner.
3. Compliance with CHALR regulations and initiation of action against CHA.
4. Delay in initiating suspension action under CHALR 20(2).
5. Merits of suspension based on contravention of CHALR regulations.

Issue 1: Early Hearing Applications
The judgment addresses two early hearing applications concerning the suspension of the license of a Customs House Agent (CHA). The first order suspended the license, and the second application was filed against another order. The tribunal dismissed both applications as the suspension order was based on pending post-decisional hearings.

Issue 2: Suspension of License under CHALR 20(2)
The action to suspend the CHA license was taken under CHALR 20(2) by the Commissioner based on a report from the Deputy Commissioner. However, it was argued that the report was not from the competent initiating authority, the Directorate of Revenue Intelligence (DRI). The tribunal found that the initiation of action was not in line with the law and set aside the order.

Issue 3: Compliance with CHALR Regulations
The judgment analyzed the compliance with CHALR regulations and the initiation of action against the CHA. It was highlighted that the action was initiated by the office of the Commissioner and the Deputy Commissioner, not the investigating authority, DRI. The tribunal found discrepancies in the initiation of action and set aside the order based on these grounds.

Issue 4: Delay in Initiating Suspension Action
The tribunal considered the delay in initiating the suspension action under CHALR 20(2). Comparisons were made with previous cases where delays in suspension were not sustained. The tribunal found that the delay of over three years in this case was not justifiable, and the order was required to be set aside based on this ground.

Issue 5: Merits of Suspension based on Contravention
The judgment delved into the merits of the suspension based on alleged contraventions of CHALR regulations. It was argued that the contraventions were not adequately supported, and the tribunal found that the suspension order lacked merit. The tribunal stayed the impugned order in the interest of justice, emphasizing the need for further inquiry in accordance with the law.

In conclusion, the judgment addressed various issues related to the suspension of a CHA license under CHALR regulations, highlighting discrepancies in the initiation of action, delays in suspension, and lack of merit in the contraventions alleged. The tribunal set aside the order and stayed it pending further inquiry, emphasizing compliance with the law and the principles of justice.