2021 (12) TMI 634 - HC - Customs

Revocation of customs broker's license - Validity of SCN - time limitation - Offence Report - SCN challenged on the ground that the impugned show cause notice dated 01.06.2021 is time barred in terms of Regulation 17(1) of the the regulation - HELD THAT - As per Regulation 17(1) of the 2017 Regulation, a notice has to be issued within 90 days from the date of receipt of offence report to a custom broker. The scheme of Regulation in the year 2018, as also in the year 2013 and also in the year 2004 is similar. The proceedings have to be initiated within a period of 90 days from the date of receipt of the offence report. Delay, if any is on the part of the office of the second respondent in forwarding the Relied Upon Documents (RUDs) which has been referred to in the impugned show cause notice. The said delay is not curable. Further, show cause notice is to be issued based on the offence report which is a mere summary of investigation and prima facie framing of charges into the allegation of acts of commission or omission of a Customs Broker or a F card holder or a G card holder under the regulation which would render such a broker unfit to transact business under these regulations. The investigation report/offence report has been filed in detail and therefore, there is no excuse for delay in issuing the show cause notice. The delay in inter-departmental communications or furnishing of Relied Upon Documents (RUDs) are of no consequences as the impugned show cause notice has been admittedly issued beyond the period of 90 days. It is noticed that the office of the second respondent and the office of the first respondent is located in the same Custom House in Parrys and therefore, there is no excuse for condoning the delay. Petition allowed.

Summary

Issues:
Challenge to impugned show cause notice under Regulation 17(1) of Customs Brokers Licensing Regulations, 2018.

Analysis:
The petitioner contested the impugned show cause notice issued under Regulation 17(1) of the Customs Brokers Licensing Regulations, 2018, claiming it was time-barred as it exceeded the 90-day limit stipulated for issuing such notices. The petitioner referred to previous court decisions to support their argument, emphasizing the importance of adhering to the prescribed time limit for issuing show cause notices.

The petitioner cited a Division Bench decision from 2017 and another court decision from 2020, both related to similar regulations, to argue that the impugned notice should be quashed due to being issued beyond the statutory time limit. The petitioner's counsel highlighted that the delay in issuing the notice rendered it without jurisdiction and time-barred, thus warranting its quashing.

In response, the standing counsel for the respondents contended that the delay in issuing the show cause notice was justified, as the necessary documents were not furnished until a later date. The respondents argued that the date of receipt of the offence report should be considered as the date when all relevant documents were available, not just the initial communication of the report.

The court examined the arguments presented by both parties and reviewed relevant precedents, including a Division Bench decision from 2016 and other court orders from 2015 and 2019. The court focused on the requirement under Regulation 17(1) to issue notices within 90 days of receiving the offence report, emphasizing the need for timely initiation of proceedings based on the report.

The court ultimately ruled in favor of the petitioner, concluding that the impugned show cause notice was time-barred. The court emphasized that the delay in furnishing necessary documents did not excuse the late issuance of the notice, especially when the offices of the concerned parties were in close proximity. As a result, the court allowed the writ petition, quashed the impugned notice, and closed the related proceedings without imposing any costs.