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2018 (4) TMI 6 - AT - CustomsRevocation of CHA License - time limitation - proceedings initiated by the Customs Authorities for revocation of the Customs Broker License, has been assailed by the appellants, mainly on the basis of the failure in observance of the time limit - Held that - Regulation 20 of the Customs Brokers Licensing Regulations, stipulates that after issuance of SCN, an Inquiry Authority has to be appointed to look into the allegation, who is required to submit inquiry report within 90 days of this appointment as per Regulations 20 (5) - In the present case, it is seen from the records that the Inquiry Officer has submitted his report on 23.05.2016, after a delay of 360 days. The time taken by the Inquiry Officer is very much beyond the limit of 90 days prescribed in Regulations 20 (5). It was held in the case of M/s. Saro International Freight System Versus The Commissioner of Customs 2015 (12) TMI 1432 - MADRAS HIGH COURT that when time limit is prescribed in Regulations, which empowers action under Regulation 18 by following the procedure in Regulation 20 (1), the use of the term shall cannot be termed as directory. Under such circumstances, the rule can only be termed as Mandatory. Appeal allowed - decided in favor of appellant.
Issues:
1. Failure to follow prescribed time limits in disciplinary proceedings under Customs Broker Licensing Regulation. 2. Justification of revocation of Customs House License based on serious nature of offences. 3. Challenge to revocation of Customs Broker License. 4. Delay in submission of inquiry report beyond prescribed time limit. 5. Interpretation of time limits as mandatory in Customs Brokers Licensing Regulations. Analysis: 1. The appeal was filed against the Order-in-Original passed by the Commissioner of Customs for revoking the Customs House License of the appellant. The appellant, a licensed Customs Broker, challenged the disciplinary proceedings initiated by Customs, alleging non-compliance with the time limits prescribed under the Customs Broker Licensing Regulation. The appellant contended that failure to adhere to the time limits would vitiate the entire proceedings, citing relevant case laws to support the argument. 2. The Department justified the revocation of the Customs House License based on the serious nature of the offences observed during the investigation by the Special Investigation Branch (SIB). However, the appellant raised concerns regarding the procedural aspects of the disciplinary proceedings, particularly focusing on the alleged non-compliance with the prescribed time limits. 3. The Customs Authorities initiated proceedings to revoke the Customs Broker License, which the appellant challenged primarily on the grounds of the failure to adhere to the specified time limits. Regulation 20 of the Customs Brokers Licensing Regulations mandates the appointment of an Inquiry Authority post the issuance of a show-cause notice, with a requirement to submit the inquiry report within 90 days as per Regulation 20(5). In this case, the Inquiry Officer submitted the report after a significant delay of 360 days, well beyond the prescribed limit, as highlighted by the appellant. 4. The Tribunal considered the argument put forth by the appellant regarding the mandatory nature of the time limits prescribed in the Customs Brokers Licensing Regulations. Citing a judgment of the Hon'ble Madras High Court in a similar matter, the Tribunal emphasized that when time limits are explicitly specified in the Regulations, they are to be considered mandatory rather than directory. Therefore, the delay in the submission of the inquiry report beyond the prescribed time limit was deemed a violation of the regulatory framework, leading to the setting aside of the impugned order revoking the Customs House License. 5. Consequently, the Tribunal allowed the appeal filed by the appellant, overturning the decision to revoke the Customs House License. The judgment highlighted the importance of adhering to the prescribed time limits in disciplinary proceedings under the Customs Brokers Licensing Regulations, underscoring the mandatory nature of such timelines in ensuring procedural fairness and compliance with the regulatory framework.
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