2016 (12) TMI 1156 - AT - Customs

Revocation of CHA licence - forfeiture of security deposit - Regulation 19 (1) of CBLR, 2013 - Time limitation - The Ld. Counsel emphatically argued the case on limitation i.e. right from initiation of the proceedings till the passing of order of revocation of CB Licence of the Appellant, the department has not complied with the condition of the time limit prescribed not only for stage wise time limitation but also for over all time limit of 9 months for revocation of CB License. Therefore, the impugned order is not sustainable only on time limit without going into the merit of the case. Therefore we take up the case for decision on limitation. Held that - it can be seen that the offence report was received by the office of the Commissioner on 05.07.2013 - The inquiry officer filed his report on 23.04.2015 i.e almost after 200 days from the date of Notice date 04.10.2013.It is observed that the inquiry officer not only defied the time line prescribed in the regulation but also disobeyed the direction given by the Commissioner to the inquiry officer. The Ld. Commissioner passed the order for revocation of the CB licence on 02.07.2015. The overall period prescribed for the entire proceeding is 9 months or 270 days from the date of receipt of offence report. As the facts discussed above the total period taken for entire proceeding till the date of passing of order is 728 days. The order for revocation was passed beyond the prescribed time limit of 270 days. Therefore the order is not maintainable on limitation itself. As regard the debate that whether the time line prescribed under the regulation is directory or mandatory, we are of the view that in the circumstances that the specific time limit prescribed under the regulation and no power for condoning the delay was provided, the time line prescribe in mandatory. It is a strite law that in a particular act if specific time limit is prescribed for any action to be taken under such law that will prevail even over the provision of limitation Act. The CHALR/CBLR, 2013 have been enacted under the Custom Act 1962. Under no circumstances time limit prescribed under any statutory provision can be relaxed. Therefore the commissioner was bound to insure that the entire preceding should have been completed within overall stipulated 270 days, which the adjudication authority failed to comply. Therefore the order of revocation passed after stipulated period of 270 days from the date of receipt of offence report cannot sustain. Since we decide this appeal on the ground of limitation itself, it is not necessary to address other issues such as merit of the case, quantum of punishment etc. - we are of the view that the impugned order is not sustainable on the ground of limitation. The impugned order is set aside - appeal allowed - decided in favor of appellant-assessee

Summary

Issues Involved:
1. Violation of Customs Broker Licensing Regulations (CBLR) 2013.
2. Adherence to statutory timelines for proceedings.
3. Reliance on retracted statements as evidence.
4. Legality of revocation of Customs Broker (CB) license and forfeiture of security deposit.

Detailed Analysis:

1. Violation of Customs Broker Licensing Regulations (CBLR) 2013:
The Directorate of Revenue Intelligence (DRI) reported that the Appellant violated CBLR 2013 by collaborating with a syndicate led by an individual to import consumer goods using bogus Importer Exporter Codes (IECs). The Appellant allegedly failed to obtain authorization from importers, did not advise compliance with customs provisions, and allowed employees to engage in illegal activities, thus violating Regulations 11(a), 11(d), 11(m), and 11(n) of CBLR 2013. The Inquiry Officer confirmed these violations in his report dated 13.04.2015.

2. Adherence to statutory timelines for proceedings:
The Appellant's counsel argued that the revocation of the license was illegal due to non-adherence to the statutory timelines prescribed under CBLR 2013. The timeline for issuing the Show Cause Notice, preparation of the inquiry report, and passing the final order were not followed, making the proceedings unsustainable. The Tribunal analyzed the timeline and found significant delays at various stages, including a delay of 728 days from the receipt of the offense report to the passing of the revocation order, which exceeded the prescribed 270 days. The Tribunal cited several judgments, including "Impexnet Logistic Vs. Commissioner of Customs (General)" and "M/s. Shiva Khurana Vs. Commissioner of Customs, New Delhi," which emphasized the mandatory nature of these time limits.

3. Reliance on retracted statements as evidence:
The Appellant's counsel contended that the case was based on statements from various individuals, which were later retracted. The counsel argued that retracted statements alone could not constitute the sole basis for a finding of guilt. The Tribunal acknowledged this argument but primarily focused on the issue of adherence to statutory timelines.

4. Legality of revocation of Customs Broker (CB) license and forfeiture of security deposit:
The Tribunal found that the revocation of the CB license and forfeiture of the security deposit were not maintainable due to the failure to adhere to the prescribed timelines. The Tribunal held that the statutory time limits under CBLR 2013 are mandatory and must be strictly followed. The Tribunal set aside the impugned order on the ground of limitation without addressing the merits of the case or the quantum of punishment.

Conclusion:
The Tribunal concluded that the impugned order revoking the CB license and forfeiting the security deposit was not sustainable due to the failure to adhere to the statutory timelines prescribed under CBLR 2013. The appeal was allowed, and the impugned order was set aside.