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2013 (10) TMI 1002 - AT - CustomsSuspension of license of CHA - Contravention of Regulation 13 (a), (d) and (m) for CHALR - License suspended without any notice to Assessee - Held that - Regulation 22(1) is applicable for issuing both suspension order and revocation order. However Regulation 20(2) authorizes the Commissioner of Customs to suspend the licence of a CHA in emergent situations without following the procedure under Regulation 22(1). It is very obvious that immediate suspension of license is permitted only when an enquiry is pending is contemplated. The non obstante clause Regulation 20(2) makes an exception only in the matter of suspension and not in the matter of revocation. So, it is implied that such inquiry has to be completed, within the time frame prescribed in various sub-regulations of Regulation 22 and a final view in the matter of revocation of license is to be taken. After two years from the date of suspension not even the show cause notice, is issued for initiation of enquiry which should have been followed in the case of an inquiry pending or contemplated on passing of the suspension order dated 02.09.2011, as required under Regulation 22 (1). At this stage, we cannot accept that such a step is still being contemplated. No person s right to carry on his profession can be stopped for a prolonged period through the means of a suspension order. Such an approach is against provisions in Regulations 20 and 22 of CHLAR. So we are of the view that the impugned order suspending the license of the appellant is no longer sustainable in view of the decision of Hon. Madras High Court in the case of CC Vs. Ganesh Shipping Agency 2008 (7) TMI 437 - HIGH COURT OF JUDICATURE AT MADRAS - Decided in favour of appellant.
Issues Involved:
1. Suspension of Customs House Agent (CHA) license under Regulation 20(2) of CHALR. 2. Compliance with Regulation 22(1) of CHALR for issuing show cause notice and conducting an enquiry. 3. Delay in issuing show cause notice and conducting an enquiry. 4. Validity of the suspension order without explicit mention of pending or contemplated enquiry. Detailed Analysis: 1. Suspension of Customs House Agent (CHA) License under Regulation 20(2) of CHALR: The appellant, a licensed Customs House Agent (CHA) under the Custom House Agents Licensing Regulations, 2004 (CHALR), was involved in filing Bills of Entry for importing goods under the Advance License Scheme. Investigations by the Directorate of Revenue Intelligence revealed that the importer obtained Advance Licenses through false declarations and did not comply with the actual user condition. Consequently, the Commissioner of Customs suspended the appellant's CHA license without notice, citing the need for immediate action under Regulation 20(2) of CHALR, which allows suspension where an enquiry is pending or contemplated. 2. Compliance with Regulation 22(1) of CHALR for Issuing Show Cause Notice and Conducting an Enquiry: The appellant contended that the suspension under Regulation 20(2) is only valid if an enquiry is pending or contemplated, and that no show cause notice as required under Regulation 22(1) had been issued. Regulation 22(1) mandates that the Commissioner of Customs must issue a written notice to the CHA within ninety days from the date of receipt of the offence report, stating the grounds for suspension or revocation and requiring a written statement of defense. The appellant argued that the absence of a show cause notice and the prolonged suspension without an opportunity to prove innocence were unjust. 3. Delay in Issuing Show Cause Notice and Conducting an Enquiry: The appellant highlighted that the suspension was ordered in June 2011, but even after two years, no show cause notice had been issued, and no enquiry had commenced. This delay was argued to be in violation of CBEC Circular 9/2010-Cus, which prescribes a time limit of nine months from the date of the offence report to the passing of the final order. The appellant emphasized that the prolonged suspension without initiating the enquiry process was causing significant harm to their livelihood. 4. Validity of the Suspension Order without Explicit Mention of Pending or Contemplated Enquiry: The Revenue argued that although the impugned order did not explicitly state that an enquiry was pending or contemplated, such an enquiry was indeed contemplated and pending, with an enquiry officer already appointed. The Revenue maintained that the suspension under Regulation 20(2) did not require following the procedure under Regulation 22(1). However, the Tribunal noted that the immediate suspension under Regulation 20(2) is only justified when an enquiry is pending or contemplated and must be followed by the procedure under Regulation 22(1), starting with the issuance of a show cause notice. Conclusion: The Tribunal concluded that the suspension order was no longer sustainable due to the failure to issue a show cause notice and initiate an enquiry within a reasonable time frame. The Tribunal set aside the impugned suspension order, emphasizing that no person's right to carry on their profession should be hindered for a prolonged period through suspension. The Tribunal also clarified that this decision should not prejudice the ongoing enquiry or bar the revocation of the license in accordance with the law. Pronouncement: The appeal was allowed, and the impugned suspension order was set aside. The Tribunal's decision was pronounced in open court on 10-10-2013.
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