2019 (3) TMI 1527 - AT - Customs

Suspension of CHA License - the appellant had forfeited his right of challenge by not seeking appellate remedies when the tentative order of suspension under regulation 19(1) of Customs Broker Licensing Regulation, 2013 was served on them - Held that - It would have been impossible for the appellant to challenge the prima facie order of suspension as he was yet to be granted an opportunity to be heard; it is only upon confirmation of the order of suspension that an appeal would lie. The contention of Learned Authorised Representative is not acceptable. The need for immediate action, which is a necessary pre-requisite for invocation of regulation 19 of Customs Broker Licensing Regulation, 2013, was a figment for visiting this detriment on the appellant without justifiable cause - It was patently incorrect on the part of the competent authority to consider this to be a ground for suspension, and more so, as suspension is a preliminary for revocation and revocation is a consequence of circumstances enumerated in regulation 18 of Customs Broker Licensing Regulation, 2018. There has been a perverse resort to the statutory powers without the competence to do so. Such whimsical action is deplorable. The order of suspension is revoked.

Summary

Issues:
Appeal against suspension of custom broker license under Customs Broker Regulation, 2013 (now Customs Broker Licensing Regulation, 2018) based on filing incorrect bill of entry and alleged wrongful availment of benefits under notification no. 50/2017. Challenge regarding the suspension procedure and authority's competence to invoke suspension clause.

Analysis:
The appellant, a custom broker, appealed against the suspension of their license under the Customs Broker Regulation, 2013 (now Customs Broker Licensing Regulation, 2018). The suspension was based on the filing of an incorrect bill of entry for the import of 'titanium alloy (forged and machined)' for hip prosthesis, which was found to be of a different material. Additionally, the appellant was accused of wrongfully availing benefits under notification no. 50/2017. The appellant's counsel argued that the reason for suspension did not empower the licensing authority to invoke the suspension clause. The appellant was alleged to have handled a consignment without verifying its eligibility for the benefit of the notification.

The tribunal considered the contention that the appellant forfeited the right to challenge the suspension by not seeking appellate remedies when the tentative suspension order was served. However, the tribunal held that it would have been impossible for the appellant to challenge the prima facie suspension order as they had not yet been granted an opportunity to be heard. The tribunal rejected the argument that the appellant had forfeited their right to challenge the suspension.

Upon reviewing the provisions of the Customs Broker Licensing Regulation, 2018, regarding suspension, the tribunal noted that the power to suspend is to be exercised when immediate action is warranted. The tribunal observed that despite the lapse of 90 days from the suspension order, the competent authority had not initiated further action as required by the regulations. The tribunal found that the need for immediate action, a prerequisite for invoking the suspension regulation, was not justified in this case.

The tribunal emphasized that the determination of duty rates and eligibility for exemptions is the responsibility of the proper officer designated to assess the consignment, not the customs broker. The tribunal criticized the competent authority for suspending the license based on issues related to exemption notifications, as this authority lies exclusively with the proper officer. The tribunal revoked the suspension order, stating that the competent authority had acted beyond its statutory powers. The licensing authority was permitted to proceed within the legal mandate of the regulations.