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2014 (7) TMI 671 - HC - CustomsSuspension of CHA licence - procedure - acts of violation and misconduct - Regulation 20(2) of the Customs House Agents Licensing Regulations, 2004 - Held that - The initial order of suspension under Regulation 20(2) and final order under Regulation 20(3) to continue the order of suspension are to be followed by an enquiry under Section 22 and admittedly, it has not been done so within the time limit prescribed. The orders of suspension passed against the second respondent in these appeals cannot continue and the concerned authority, namely the appellant herein has to take a decision whether to suspend or revoke the licence in terms of Regulation 22 and if he fails to do so, the only result is to set aside the impugned orders of initial suspension and its continuance and in the considered opinion of the Court, the Tribunal has rightly done that exercise by correct appreciation of facts and application of Regulations 20 and 22 of CHALR, 2004. The Hon'ble Supreme Court of India in the decision in Ranadey Micronutrients v. Collector of Central Excise 1996 (9) TMI 124 - SUPREME COURT OF INDIA has held that the Board circular issued by the Central Board of Excise and Customs is binding on the Revenue and they cannot be challenged on the ground of inconsistency with any statutory provisions. In the light of the legal position, it is not open to the appellant/Revenue to take a contra stand in respect of the time limit prescribed under Regulation 22 of CHALR, 2004. The compliance of procedure under Regulation 20 would not tantamount the compliance of Regulation under 22 and therefore, the substantial questions of law raised in these appeals are answered in negative against the appellant in these appeals. - Decided against the revenue.
Issues Involved:
1. Legality of the suspension and continuation of the Customs House Agent (CHA) licenses under Regulation 20(2) and 20(3) of the Customs House Agents Licensing Regulations, 2004 (CHALR). 2. Compliance with the procedural requirements under Regulation 22 of CHALR. 3. Validity of the orders passed by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) setting aside the suspension orders. Detailed Analysis: 1. Legality of the Suspension and Continuation of CHA Licenses: The Commissioner of Customs (Port-Import), Chennai, suspended the CHA licenses of the respondents under Regulation 20(2) of CHALR, 2004, citing misuse of the Advance Authorization Scheme and non-compliance with CHALR obligations. The suspension orders were passed as immediate actions deemed necessary to protect revenue interests. Subsequently, the Commissioner continued the suspension after granting an opportunity for personal hearing, as mandated by Regulation 20(3). 2. Compliance with Procedural Requirements under Regulation 22: Regulation 22 outlines the procedure for suspending or revoking a CHA license, including issuing a notice within 90 days from the date of the offense report and conducting an inquiry. The Tribunal found that no such notice was issued within the prescribed time frame, and no inquiry was conducted as required. The Tribunal emphasized that the suspension under Regulation 20(2) is an interim measure and must be followed by a formal inquiry under Regulation 22 to decide on permanent suspension or revocation. 3. Validity of CESTAT Orders: The CESTAT set aside the suspension orders, stating that the continuation of suspension without issuing a notice under Regulation 22(1) and without conducting an inquiry was against the provisions of CHALR, 2004. The Tribunal noted that the suspension orders had been in effect for an extended period without following the due process for revocation or permanent suspension, thus violating the respondents' right to carry on their profession. Conclusion: The High Court upheld the CESTAT's decision, confirming that the procedural requirements under Regulation 22 were not met. The Court ruled that the suspension orders could not continue indefinitely without following the proper procedure for revocation or permanent suspension. The compliance with Regulation 20 does not substitute the need for compliance with Regulation 22, and the substantial questions of law raised by the appellant were answered in the negative. Consequently, the appeals were dismissed, and the CESTAT's orders setting aside the suspension were confirmed.
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