2015 (11) TMI 1082 - AT - Customs

Suspension of CHA license - Evasion of CVD - Undervaluation - Held that - there is no allegation made out against the appellant CHA firm of the active involvement in the alleged undervaluation by the said importers. Further no documents appeared to have been executed and handled by the said Faiyaz Merchant, on behalf of the appellant firm. It is further admitted fact that the suspension have been made by way of interim measure for alleged misgivings and/or action or inaction on the part of the appellant for imports prior to March, 2012, almost after 2 years and as such interim suspension, pending inquiry is bad and not called for. - there is no allegation made out against the appellant CHA firm of the active involvement in the alleged undervaluation by the said importers. Further no documents appeared to have been executed and handled by the said Faiyaz Merchant, on behalf of the appellant firm. It is further admitted fact that the suspension have been made by way of interim measure for alleged misgivings and/or action or inaction on the part of the appellant for imports prior to March, 2012, almost after 2 years and as such interim suspension, pending inquiry is bad and not called for. Interim suspension of the appellant CHA firm vide the impugned order is set aside. The Commissioner of Customs is directed to complete the inquiry proceedings expeditiously preferably within a period of 12 months from receipt of a copy of this order. The appellant CHA firm is entitled to carry on its business as CHA with immediate effect. - Decided in favour of assessee.

Summary

Issues involved:
Appeal against Order-in-Original, Allegations of under-valuation of imported goods, Suspension of license, Violation of CBLR regulations, Interim suspension order, Compliance with inquiry proceedings, Relief sought by the appellant, Rival contentions by the parties, Legal arguments presented, Judicial interpretation of suspension power.

Detailed Analysis:

1. Appeal against Order-in-Original:
The appellant, a Customs broker, appealed against Order-in-Original No. 09/2014-15 passed by the Commissioner of Customs (General) Mumbai, challenging the interim suspension ordered to continue based on allegations of under-valuation of imported goods.

2. Allegations of under-valuation of imported goods:
The case involved importers engaging in under-valuation of goods to evade Customs duty, with evidence pointing to deliberate suppression of retail sale prices and undervaluation in bill of entry declarations, leading to evasion of duty. Statements from involved parties admitted to undervaluation practices.

3. Suspension of license and Violation of CBLR regulations:
The appellant's license was suspended based on allegations of subletting, failure to comply with regulatory provisions, lack of due diligence, involvement in under-valuation leading to revenue loss, failure to pay duties promptly, and inefficiency in cargo clearance operations.

4. Interim suspension order and Compliance with inquiry proceedings:
The appellant's license was suspended as an interim measure pending inquiry proceedings, with the appellant contesting the timing and necessity of the suspension, arguing that no further imports were made after the alleged violations in 2012, and questioning the delay in initiating the inquiry.

5. Relief sought by the appellant and Rival contentions by the parties:
The appellant sought relief from the suspension, arguing that there was no active involvement in the alleged violations and that the suspension was unjustified. The Revenue, represented by the Dy. Commissioner, relied on the impugned orders to support the suspension.

6. Legal arguments presented and Judicial interpretation of suspension power:
The appellant contended that the suspension was not warranted given the timing of the alleged violations and the lack of progress in inquiry proceedings. The Tribunal, considering the arguments, found no basis for the suspension and referred to a Bombay High Court ruling emphasizing the need for immediate suspension only in urgent cases.

7. Judgment and Order:
The Tribunal set aside the interim suspension of the appellant's license, directing the completion of inquiry proceedings within 12 months. The appellant was allowed to resume business as a Customs broker immediately, with the appeal being allowed in favor of the appellant.

This comprehensive analysis highlights the key issues, arguments, and the Tribunal's decision in the legal judgment, covering the nuances of the case and the reasoning behind the final order.