2001 (3) TMI 127 - AT - Customs

Summary

Issues Involved:
1. Whether the suspension of the appellant's Customs House Agent (CHA) license under Regulation 21(2) of the CHA Regulations was in breach of the principles of natural justice.
2. Whether the Commissioner was required to follow the procedure under Regulation 23 for suspension under Regulation 21(2).
3. Whether the Commissioner's order was issued in colorable exercise of power.

Summary:

1. Breach of Principles of Natural Justice:
The appellant-Company contended that the suspension of their CHA license was made in breach of the principles of natural justice, as no show-cause notice was served, nor was any personal hearing given before the order was issued. The Tribunal noted that the principles of natural justice require at least a minimal opportunity to be heard, either pre-decisional or post-decisional, as laid down by the Hon'ble Supreme Court in cases like *Mohinder Singh Gill v. Chief Election Commissioner* and *Maneka Gandhi v. Union of India*. The Commissioner failed to provide even a post-decisional hearing, thus failing the test of natural justice.

2. Applicability of Regulation 23 Procedure:
The Tribunal examined the provisions of Regulations 21 and 23 of the CHA Regulations. It concluded that the procedure laid down under Regulation 23, which includes issuing a show-cause notice and providing a personal hearing, is not applicable to the immediate suspension of a license under Regulation 21(2). The action under Regulation 21(2) is of an interim nature and is warranted by the exigencies of the situation. The non-obstante clause in Regulation 21(2) indicates that the Commissioner's function under this sub-regulation is not subject to the provisions of Regulation 23.

3. Colorable Exercise of Power:
The Tribunal found that the impugned order did not show the existence of any pre-requisites for suspension under Regulation 21(2), such as a pending or contemplated enquiry or a finding of genuine necessity for immediate action. The order was thus deemed to be issued in colorable exercise of jurisdiction. The Tribunal directed the Commissioner to give a personal hearing to the appellants and pass a speaking order within four weeks on whether the suspension should continue. If the Commissioner fails to pass such an order within the stipulated period, the impugned order will stand set aside.

Conclusion:
The Tribunal held that the suspension order did not comply with the principles of natural justice and was issued in colorable exercise of power. The Commissioner was directed to provide a personal hearing and pass a speaking order within four weeks, failing which the suspension order would be set aside. The Tribunal clarified that this order does not prevent the Commissioner from proceeding against the appellants under Regulation 21(1).