2014 (8) TMI 173 - AT - Customs

Suspension of CHA license - After suspension that no proceedings were initiated under Regulation 22 of CHALR, 2004 - Held that - As per Board s circular dated 8.4.2010 proceedings against CHA is required to be completed within 9 months of the date of receipt of offence report. Admittedly, in this case time has been passed for more than 2 years after receipt of offence report. Therefore, relying on the decision in the case of Vinod Tomar (2011 (6) TMI 645 - CESTAT, NEW DELHI) the appellants are entitled for relief. In these circumstances we revoke the suspension of CHA license No. 01/CHALR/2011 ordered vide impugned order dated 29.9.2011 - Decided in favour of Appellants.

Summary

Issues:
Suspension of CHA license based on gross undervaluation with connivance, additional ground application, delay in completion of proceedings under Regulation 22 of CHALR, 2004.

Analysis:
The appellant, a Customs House Agent (CHA), appealed against the suspension of their license due to involvement in gross undervaluation activities with importers. The Directorate of Revenue Intelligence (DRI) conducted searches at the CHA's office premises and recovered incriminating documents, including tampered import invoices. The CHA admitted to tampering with invoices to facilitate customs duty evasion by importers. The CHA license was suspended on 5.9.2011 under Regulation 20(2) of CHALR, 2004. A personal hearing was granted, but no further action was taken under Regulation 22 of CHALR, 2004. The appellant sought revocation of the suspension order dated 29.9.2011.

The appellant argued that proceedings under Regulation 22 should have been completed within 9 months of receiving the offence report, citing a Tribunal decision in the case of Vinod Tomar. However, over 2 years had passed without completion of Regulation 22 proceedings. The appellant requested setting aside the impugned order based on this delay.

The learned A.R. contended that due to the seriousness of the alleged offence and ongoing DRI investigation, the suspension should continue until the investigation concludes. After hearing both parties, the Tribunal considered the submissions and referred to a Board circular requiring completion of proceedings against CHAs within 9 months of receiving the offence report. Since more than 2 years had elapsed without completion, the Tribunal, following the Vinod Tomar case precedent, revoked the suspension of the CHA license.

The Tribunal granted relief to the appellants by revoking the suspension order but allowed the Revenue to proceed against the appellant under Regulation 22 of CHALR, 2004. The appeal was disposed of accordingly, along with the miscellaneous application.