2018 (7) TMI 189 - AT - Customs

Revocation of CHA License - forfeiture of security deposit - violation of the statutory time limits prescribed in the CBLR, 2013 - on merits, the case of Revenue against appellant is that the appellant has allowed the license to be misused in Mumbai. In Mumbai, the Authorised Representative of the appellant has sub-contracted the CHA license to unauthorised persons who were found to have indulged in evasion of Customs duty by filing the bills of entry in the name of non existent importers. Held that - The CBLR, 2013 have prescribed time limits for completing the disciplinary action against the Customs Brokers. Proceedings are required to be initiated by the Licensing authority after receipt of Offence Report and in time bound manner - however, the time limit contained in Regulations cannot be construed to be mandatory and has held to be directory - the proceedings in the present case cannot be held to be vitiated for non-completion of the proceedings within the time limit specified in the CBLR,2013. In the present proceedings the Licensing Authority has given elaborate findings to the effect that the appellant has contravened CHA Regulations. By the act of sub-letting of the CHA license in Mumbai, the contravention of Regulation 12 is established. The appellant has been found to have failed in carrying out proper verification of the antecedents of the importers thereby facilitating smuggling of goods by filing documents in the name of fictitious firms - there are no reason to interfere with the findings of the lower authority that the appellant has contravened several Regulations under the CBLR,2013. Revocation of CHA License upheld - appeal dismissed - decided against appellant.

Summary

Issues:
- Violation of statutory time limits under CBLR, 2013.
- Revocation of Customs Broker License based on merits.

Violation of Statutory Time Limits:
The appeal challenged the Order-in-Original revoking the Customs Broker License and forfeiting the security deposit due to non-compliance with the statutory time limits under the Customs Broking License Regulation, 2013 (CBLR). The appellant argued that the time limits in the CBLR are mandatory, citing decisions of the Tribunal and the Madras High Court emphasizing strict adherence to these limits. However, the Revenue contended that the time limits were directory, referring to judgments of the Kolkata High Court and the Bombay High Court supporting this view. The Tribunal acknowledged that the proceedings did not meet the specified time limits but ultimately relied on the Kolkata High Court's interpretation that the time limits under CBLR, 2013 are directory, not mandatory, thus ruling that the proceedings were not invalidated solely due to the delay.

Revocation of Customs Broker License Based on Merits:
Regarding the merits of the case, it was found that the appellant's Customs Broker License was revoked due to serious violations. The appellant allowed the license to be misused in Mumbai, where unauthorized individuals were found to have engaged in customs duty evasion by filing documents in the name of non-existent importers. The authorized signatory of the appellant was involved in repeated cases of smuggling gold ornaments, leading to his arrest under COFEPOSA. The Licensing Authority concluded that the appellant contravened CHA Regulations by subletting the CHA license and failing to verify the antecedents of importers properly, facilitating smuggling activities. Consequently, the Tribunal upheld the lower authority's decision to revoke the appellant's Customs Broker License and forfeit the security deposit, finding no grounds to interfere with the findings that the appellant breached several Regulations under the CBLR, 2013.

In conclusion, the appeal was dismissed, and the impugned order revoking the Customs Broker License was upheld, along with the forfeiture of the full security deposit. The Tribunal's decision was pronounced on 11/05/2018.