2020 (3) TMI 1219 - HC - Customs

Suspension of CHA License - mis-description of the goods or the erroneous classification of the goods - By the judgment and order impugned dated December 15, 2017, the writ petition was allowed since the very basis of the order of suspension had been destroyed upon the order of adjudication of September 12, 2017 being set aside qua the first respondent by the appellate order of October 26, 2017 - HELD THAT - As of date, the prejudice caused by the original order of adjudication of September 12, 2017 has been wiped clean as against the agent. In such scenario, no reasonable authority could have suspended the licence of the agent or instituted proceedings therefor without the order dated October 26, 2017 being challenged or without first having such order annulled. At any rate, the entire issue has now been resolved and at the level of the tribunal, it has been decided that the relevant goods in this case answered the description that was applied by the agent in this case and not as suggested by the department. In such circumstances, nothing remains of the matter except the compensation that can be claimed by the agent for its licence effectively remaining suspended for more than two years while the appeal was pending. The judgment and order impugned dated December 15, 2017 do not call for any interference. The agent will be entitled to function as such, subject to obtaining renewal or extension of its tenure in accordance with law - Application disposed off.

Summary

Issues:
Appeal against suspension of Customs House agent's license due to misclassification of goods.

Analysis:
The appeal before the Calcutta High Court involved challenging the suspension of a Customs House agent's license based on the misclassification of goods. The first respondent, a Customs House agent, had handled a consignment of music systems at Kolkata Port, classifying them as multimedia speakers instead of radio receivers. This misclassification resulted in a lower rate of import duty being applied. An order of adjudication was issued, naming the importer and the first respondent, which was later appealed against. Subsequently, proceedings were initiated to suspend the first respondent's license based on the initial order of adjudication, which had been set aside in the appeal process. The High Court, in its judgment dated December 15, 2017, allowed the writ petition challenging the suspension, as the basis for suspension had been invalidated by the appellate order. The Court noted that the matter of goods classification had been settled at the tribunal level, affirming the agent's classification as appropriate.

The Court emphasized that the prejudice caused by the original order of adjudication had been rectified, and no reasonable authority could have suspended the license without challenging or annulling the subsequent appellate order. The judgment clarified that the agent was entitled to resume operations, subject to renewal or extension of its tenure as per the law. Additionally, any pending renewal application for the agent's license was directed to be disposed of promptly to avoid unnecessary delays in the agent's work resumption. Two applications were dismissed with costs awarded to the first respondent agent, and another application was disposed of. The Court instructed the provision of urgent certified copies of the order to the parties upon compliance with formalities.