2019 (12) TMI 294 - AT - Customs

Immediate action/continued action of suspension of Customs Broker Licence - Commissioner of Customs (General), in exercise of the powers conferred under provisions of Regulation 16(2) of the Customs Broker Licensing Regulations, 2018, orders that suspension of Customs Broker shall continue pending inquiry proceedings under Regulation 17 of the Customs Broker Licensing Regulations, 2018 - illegal export of contraband substance purported to be ketamine under the provisions of NDPS Act, 1985 read with the provisions of Customs Act, 1962. HELD THAT - There is enough power vested in the commissioner to suspend the license of Custom Broker, in terms of Custom Broker Licensing Regulation, 2018. However said power which impact the lively hood of the person and his employee needs o be exercised with caution and in accordance with the inbuilt safeguards, to prevent the arbitrary and reckless use of the power. One of the safeguard that has been built in the scheme, is to decide the matter after affording the post decision hearing in case of immediate suspension. This post decision hearing is not an empty formality but the responsibility cast on the Commissioner to decide the issue of continuation of suspension in reasonable and logical manner by way of speaking order, clearly recording the reasons for suspension of licence. The reason obliviously cannot be enquiry is contemplated simplicitor. In the present case Commissioner has not recorded any reason for the cause of immediate suspension or continuation of the suspension. We do not find any merits in the impugned order to sustain the same. - the appeal is allowed

Summary

Issues Involved:
1. Legality of the suspension of the Customs Broker license.
2. Compliance with the Customs Broker Licensing Regulations, 2018.
3. Adequacy of reasons provided for the suspension.

Issue-Wise Detailed Analysis:

1. Legality of the Suspension of the Customs Broker License:
The appeal challenges the Order No. 131/2018-19 dated 27.03.2019 by the Principal Commissioner of Customs (General), Mumbai-I, which continued the suspension of the Customs Broker M/s Ratnadip Shipping Private Limited. The suspension was initially ordered on 11.01.2019 under Regulation 16(1) of the Customs Broker Licensing Regulations, 2018, based on an Offence Report concerning the illegal export of contraband substances. The Tribunal examined whether the suspension was legally justified and whether due process was followed.

2. Compliance with the Customs Broker Licensing Regulations, 2018:
The Tribunal scrutinized the compliance with Regulation 16(2) and Regulation 17 of the Customs Broker Licensing Regulations, 2018. The Commissioner had cited statements from the Director and an employee of the appellant company, alleging failure to fulfill obligations under the regulations, thereby violating Regulation 10 of the Customs Broker Licensing Regulations, 2018. However, the Tribunal noted that the Commissioner did not provide sufficient immediate reasons for the suspension or its continuation, as required by the regulations.

3. Adequacy of Reasons Provided for the Suspension:
The Tribunal critically evaluated the reasons cited by the Commissioner for the suspension. The Commissioner relied on precedents, including the Punjab and Haryana High Court's decision in Naresh Sharma and the Tribunal's decisions in Maharaja Cargo and Dharamdas & Co. However, the Tribunal found that these precedents did not support the continuation of suspension without explicit and detailed reasoning. The Tribunal emphasized that the Commissioner must record specific reasons for immediate action and continuation of suspension, which were lacking in this case.

The Tribunal highlighted that the power to suspend a Customs Broker license must be exercised with caution and in accordance with inbuilt safeguards to prevent arbitrary use. The Tribunal referred to various judicial decisions, including those of the Madras High Court and the Calcutta High Court, which underscored the necessity of providing clear and categorical reasons for immediate suspension. The Tribunal concluded that the Commissioner failed to justify the immediate and continued suspension of the license.

Conclusion:
The Tribunal allowed the appeal, setting aside the impugned order due to the lack of adequate reasoning and non-compliance with the procedural safeguards mandated by the Customs Broker Licensing Regulations, 2018. The Tribunal emphasized the importance of detailed and reasoned orders to uphold the principles of justice and accountability.