2021 (9) TMI 204 - HC - Customs

Suspension of Customs Broker Licence - initial order of suspension itself was issued belatedly - order of suspension was issued after lapse of 7 months from the date of inspection conducted - Rule 19(1) of the Customs Brokers Licensing Regulations 2013 - grant of interim stay, allowing to continue the license by respondent - HELD THAT - After passing an order of interim suspension under Rule 19(1) of the Customs Brokers Licensing Regulations 2013, the Commissioner shall, within 15 days from the date of suspension, give an opportunity of hearing to the Customs Broker, whose licence is suspended and will pass such orders as he deems fit either revoking the suspension or continuing it, as the case may be, within 15 days from the date of hearing granted to the Customs Broker. Thus, even in cases where suspension order is issued on contemplation of charges or during the pending enquiry, the Commissioner has to follow the procedures contemplated under Sub-Rule (2) to Rule 19 of the Customs Broker Licensing Regulations 2013. In the present case, such an opportunity was provided and the suspension was continued in the impugned proceedings dated 15.06.2016. However, the proceedings initiated based on the allegations are yet to be concluded. The petitioner filed the present writ petition and by virtue of the interim order granted, the licence is allowed to be continued by the respondent. This Court is of the considered opinion that interim suspension cannot be allowed to continue for a longer period nor the authority on initiation of proceedings are expected to conclude the proceedings by following the procedures as contemplated under Regulation 20 as expeditiously as possible, both in the interest of the Department as well as in the interest of the Customs Broker concerned. Undoubtedly, prolonged suspension of license is also bad in law. Such prolonged suspension would not serve the purpose for which the power of interim suspension is contemplated under the Regulations - As far as the present writ petition is concerned, the impugned order was passed on 15.06.2016 and five years have lapsed and further the petitioner is enjoying the broker licence during the pendency of the writ petition. Petition allowed.

Summary

Issues:
Challenge to order of suspension of Customs Broker License under Rule 19 (1) of Customs Brokers Licensing Regulations 2013.

Analysis:
The petitioner, a Private Limited Company, challenged the order of suspension of its Customs Broker License issued by the respondent. The respondent contended that the suspension order was not belatedly issued, while the petitioner argued that suspension is only an interim measure under Rule 19(1) and cannot be prolonged. The respondent, represented by the Senior Standing Counsel, maintained that the suspension was valid and justified under the Regulations.

Rule 19 of the Customs Brokers Licensing Regulations 2013 empowers the Commissioner of Customs to suspend a license where immediate action is necessary pending an enquiry. The Commissioner must provide a hearing within 15 days of suspension to decide on revoking or continuing the suspension. The purpose of suspension is to protect the Customs area's interests and is not a punishment. The Court emphasized that suspension should not be unduly prolonged and must be based on the circumstances of each case.

In this case, the suspension order was issued in 2016, and the proceedings are yet to be concluded. The Court directed the respondent to complete the enquiry within six months while keeping the suspension order in abeyance until then. The Court highlighted the importance of expeditious proceedings and emphasized that the purpose of suspension is to halt the broker's operations promptly upon receiving allegations or materials.

The Court allowed the writ petition, directing the respondent to conclude the enquiry promptly and follow the procedures outlined in the Customs Brokers Licensing Regulations 2013. The suspension order remains in abeyance until the conclusion of the enquiry. No costs were awarded, and the connected miscellaneous petitions were closed.