2023 (7) TMI 725 - AT - Customs

Revocation of Customs Broker License - forfeiture of security deposit - penalty under regulation 18 of Customs Brokers Licensing Regulations, 2018 - claim for drawback that were found to mis-match in description - denial of cross-examination of some of the key persons connected with the export - violation of principles of natural justice - HELD THAT - Considering the criticality of observance of principles of natural justice in proceedings that may have the effect of extinguishment of livelihood of appellant and its employees, denial of cross-examination of persons taints the entire proceedings. It would appear as the enquiry has relied substantially upon the statements of the said individuals, it was improper on the part of the inquiry officer to deny cross-examination. Furthermore, in his capacity as licensing authority it was incumbent upon the Commissioner of Customs to ensure that, in matters jeopardizing the livelihood of customs brokers, no deviation from the principles of natural justice is to be tolerated. A tainted enquiry is no enquiry. However, an incomplete enquiry is no ground, as sought by Learned Counsel, for exoneration of a customs broker charged with breach of obligations prescribed in regulation 10 of Customs Brokers Licensing Regulations, 2018. Matter remanded back to the original authority, directing that fresh enquiry be carried out not only in accordance with the regulations but in compliance with principle of natural justice and decide afresh on the charges framed against the appellant - appeal allowed by way of remand.

Summary

Issues involved: Challenge to revocation of customs broker license, forfeiture of security deposit, and imposition of penalty based on violation of principles of natural justice.

Summary:

Revocation of License and Forfeiture of Security Deposit:
The appeal by M/s Perfect Shipping Services challenged the revocation of their customs broker license and forfeiture of security deposit, along with a penalty imposition of Rs. 50,000. The proceedings were initiated due to mismatches in export claims against multiple shipping bills. The appellant contended that the inquiry found breaches of obligations under Customs Brokers Licensing Regulations, 2018, but they were denied the opportunity to cross-examine key individuals connected to the exports.

Principles of Natural Justice:
The appellant argued that denial of cross-examination tainted the proceedings, as reliance on statements without the opportunity for cross-examination was improper. The Tribunal emphasized the criticality of adhering to natural justice principles in proceedings affecting livelihoods, stating that a tainted enquiry is unacceptable. However, the Tribunal also noted that an incomplete enquiry does not automatically exonerate a customs broker from charges of breaching licensing regulations.

Decision and Remand:
The Tribunal set aside the impugned order and remanded the matter back to the original authority. They directed a fresh enquiry to be conducted in compliance with both regulations and principles of natural justice. It was emphasized that in matters impacting customs brokers' livelihoods, deviation from natural justice principles cannot be tolerated. The appeal was disposed of accordingly, with the order pronounced in open court on 13/07/2023.