2016 (4) TMI 442 - HC - Customs

Revokation of suspended licence - Imported cigarettes without proper declaration through respondent - Commissioner after granting personal hearing within 15 days of the date of suspension, did not order either continuing or revoking the suspension for nearly five and half months. So, Tribunal by interpreting Regulation 19&20 of Regulations of 2013 came to conclusion of automatic revokation of suspension. Held that - proviso to Regulation 19 of the Regulations of 2013 provides that in case of Principal Commissioner of Customs or Commissioner of Customs, as the case may be, passes an order for continuing the suspension, the further procedure thereafter shall be as provided in Regulation 20. As noted, Regulation 20 prescribes procedure for revoking licence or imposing penalty. The proviso to Regulation 19 refers to the further procedure to be undertaken after the competent authority has passed an order continuing the suspension of the broker, which prima facie, in our opinion, is an emphatic way of providing that if the order of suspension of a broker is continued, the authorities would proceed to decide finally on the question of imposing penalty or for revoking the licence. This would not, however, mean that for some reason, authority under Regulation 19(2) decides to not continue the suspension or to revoke it, no further procedure under Regulation 20 can be undertaken. In a given case, the authority may decide not to continue the suspension of the licence of the broker, may nevertheless be advised to undertake proceedings for imposing penalty or some such action under Regulation 20. Likewise, mere lapsing of the order of suspension of licence for want of further continuation in terms of sub-regulation (2) of Regulation 19 may not debar the Department from further action under Regulation 20.

Summary

Issues:
1. Interpretation of Regulations 19 and 20 regarding suspension of customs broker's license.
2. Delay in passing order continuing or revoking suspension of license.
3. Authority's discretion in deciding further action under Regulation 20 after suspension lapses.

Analysis:
1. The case involved a customs broker whose license was suspended due to imported cigarettes found without proper declaration. The Commissioner of Customs suspended the license under Regulation 19(1) of the Customs Brokers Licensing Regulations, 2013. The respondent was granted a hearing within 15 days of suspension, but the order continuing or revoking the suspension was delayed for over five months after the hearing, passed only on 03.03.2015.

2. The Tribunal held that under Regulations 19 and 20, the requirement to pass an order within 15 days of the hearing was mandatory. Failing to do so would result in automatic revocation of the suspension. The High Court noted the Tribunal's interpretation but refrained from delving into the regulatory interpretation. The Commissioner provided no reasons for the delay in passing the order, and the Tribunal's order declaring automatic lapse of suspension was already in effect since May 2015.

3. The High Court decided not to interfere in the present case, keeping the question of law open. It emphasized that if the suspension is continued, further procedures under Regulation 20 for imposing penalties or revoking the license should be followed. The Court clarified that the lapse of suspension does not prevent the Department from taking further action under Regulation 20, even if the suspension is not continued or revoked. The Tax Appeal and Civil Application were dismissed without deciding the legal question, allowing the Department to pursue further action under Regulation 20.