2021 (4) TMI 24 - HC - Customs

Revocation of Customs Broker License - forfeiture of security deposit - time limitation for issuance of SCN under Regulation 20 read with Regulation 18 of the Customs Broker Licensing Regulation, 2013 - HELD THAT - Regulation 20 of the Customs Broker Regulation, 2013 makes it clear that the Commissioner of Customs shall issue a notice in writing to a customs broker within a period of 90 days from the date of receipt of an offence report stating that the grounds on which it is proposed to revoke the license or impose penalty requiring a customs broker to submit within a period of 30 days to the Deputy Commissioner of Customs or Assistant Commissioner of Customs nominated by him, a written statement of defence and also to specify in the said statement whether the customs broker desires to be heard in person before the Deputy commissioner of the Customs or the Assistant Commissioner of Customs. Admittedly in this case, the 90th day from the date of offence report dated 7.9.2016 would have expired on 06.12.2016 whereas the impugned show cause notice dated 31.11.2017. It was thus beyond the limitation prescribed under Regulation 20 of the Customs Broker Licensing Regulation, 2013. Petition allowed.

Summary

Issues:
1. Challenge to show cause notice issued by the first respondent regarding revocation of license and penalty imposition.
2. Grounds for challenging the show cause notice based on limitation period.
3. Interpretation of Regulation 20 of the Customs Broker Licensing Regulation, 2013.
4. Defending the impugned order by the respondents.
5. Suspension of license and subsequent proceedings.
6. Analysis of relevant case laws.

Issue 1: Challenge to Show Cause Notice
The petitioner challenged the show cause notice issued by the first respondent, calling for justification on license revocation, security forfeiture, and penalty imposition under Regulation 20(1) of the Customs Broker Licensing Regulation, 2013.

Issue 2: Grounds for Challenge
The challenge was primarily based on the notice being issued beyond the prescribed limitation period of 90 days from the offense report, as the petitioner's license was suspended earlier under Regulation 19. The impugned notice was issued on 31.01.2017, exceeding the time limit.

Issue 3: Interpretation of Regulation 20
Regulation 20 mandates the Commissioner of Customs to issue a written notice to a customs broker within 90 days from the offense report, detailing the grounds for license revocation or penalty imposition. The broker must submit a defense statement within 30 days and can request a personal hearing.

Issue 4: Defending the Order
The respondents defended the order citing an offense case against the petitioner for facilitating clearance without proper KYC verification, leading to misuse of import licenses. The suspension of the license was based on Section 19(1) of CBLR, 2013.

Issue 5: Suspension and Subsequent Proceedings
The suspension of the license was revoked on the same day the impugned notice was issued, with the prohibition order to continue in various customs zones. The subsequent proceedings were in line with the regulations.

Issue 6: Analysis of Case Laws
Several court decisions were referenced to support both sides of the argument, highlighting the importance of the limitation period in issuing show cause notices and subsequent orders. The judgment ultimately quashed the order due to the notice being issued beyond the 90-day limit, following precedents set by previous court decisions.

This detailed analysis of the judgment provides a comprehensive understanding of the legal issues involved and the court's decision based on the interpretation of relevant regulations and case laws.