2018 (11) TMI 855 - AT - Customs

Revocation of CHA License - Forfeiture of security deposit - it was alleged that appellant has failed to sensitise the importer regarding the obligations under the Customs Law and Foreign Trade Policy - violation of Regulation 11(d) of the CBLR, 2013 - time limitation to issue enquiry report - Held that - The Regulation 20(5) of the CBLR, 2013 specifies that the enquiry report on alleged offence is required to be made available to the Customs Broker within a period of 90 days from the date of show cause notice proposing action under CBLR, 2013 - In the present case the show cause notice has been issued on 22.06.2017, but after conclusion of the enquiry the report has been made available to the appellant only on 24.11.2017, even though the same has been signed on 09.10.2017. This is clearly after the period of 90 days specified in the Regulation 20(5). Non-observance of this time limit itself will render the proceedings liable to be quashed. There is no specific evidence produced by the Revenue to the effect that appellant have failed to comply with the Regulation 11 (d). The Jurisdictional Commissioner, while adjudicating the customs offence has also absolved the appellant from imposition of any penalty under the Customs Act. He has further observed in passing in the Order that the appellant cannot be held under Regulation 11(d). There is no justification for the extreme steps taken by the lower authority in ordering for forfeiture of the security deposit and revoking the customs broker license - appeal allowed - decided in favor of appellant-CHA.

Summary

Issues:
Revocation of Customs Broker License and forfeiture of security deposit based on alleged violations of Customs Act and Customs Broker Licensing Regulation, 2013.

Analysis:
The appellant, a licensed Customs Broker, filed bills of entry for import at Navasheva Customs House, Mumbai, on behalf of a client. The Customs Authority found discrepancies in the attached licenses and ordered confiscation of the imported goods under Section 111 of the Customs Act, 1962. Subsequently, show cause notices were issued to both the importer and the appellant for alleged violations. The appellant was accused of failing to sensitize the importer about Customs Law and Foreign Trade Policy, leading to the revocation of their Customs Broker License and forfeiture of the security deposit.

The appellant challenged the order on two main grounds. Firstly, they argued that the proceedings violated the time limits specified in the Customs Broker Licensing Regulation, 2013, as the enquiry report was provided after 90 days from the issuance of the show cause notice. Secondly, on merit, the appellant contended that they had not failed to sensitize the importer, as observed in a previous order related to the same customs offence where no penalty was imposed on them.

The Tribunal noted that the delay in providing the enquiry report beyond the stipulated 90 days rendered the proceedings liable to be quashed under Regulation 20(5) of the CBLR, 2013. Additionally, regarding the alleged violation of Regulation 11(d) of the CBLR, 2013, the Tribunal found no specific evidence presented by the Revenue that the appellant had failed to comply with the regulation. The Tribunal also highlighted that the Jurisdictional Commissioner had absolved the appellant from any penalty under the Customs Act and observed that the appellant could not be held liable under Regulation 11(d).

Consequently, the Tribunal set aside the impugned order, ruling that there was no justification for revoking the Customs Broker License and forfeiting the security deposit. The appeal was allowed, and the appellant's license was reinstated.