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TMI Blog2019 (10) TMI 504X X X X Extracts X X X X X X X X Extracts X X X X ..... s defeated by holding it to be directory and whether the object would be achieved by construing it to be mandatory has to be considered. For the object of time limit in Regulation 20 of CBLR, 2019/2018 we opine that said time limit is evolved so that the inquiry and proceedings are not delayed indefinitely as it hampers the brokerages of the customs broker. At the same time, the time limit should not be so strictly adhered to, even in cases of serious lapse on the part of the customs broker and where the inquiry involves certain complicated facts. Merely because the inquiry was not completed within a stipulated period, the customs broker may not be allowed to walk free, as his suspension cannot be continued beyond the period prescribed in the Regulation and his licences need not be restored. The judgments on which reliance had been placed by the appellant taking a view that the revocation of a CHA license is bad in law since the time limit for completion of inquiry in terms of Regulation 20(5)/22(5) of CBLR, 2013/2018 has not been adhered to, are not applicable to the facts of the present case as most of these cases have dealt with the extraordinary delay caused at the instance of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs for his clandestine operations. The input categorically stated that said Shri Ramesh Wadhera was the financer and Shri Sanjeev Maggu was the master mind behind the said activity of diverting the warehoused goods from public bonded warehouses M/s. Rider India & M/s. Prime Time Exports into the domestic markets without payment of Customs duty and creating forged/fabricated documents evidencing the re-export of warehoused goods. Based on the said information, searches were conducted by the DRI officers on 14.07.2017 in the residential premises of both the above named people and also in their various official premises as well as in the premises of associated importing firms and the cargo agencies. Statements of all concerned were also recorded. It is thereafter that the show cause notice No. 16729 dated 10.08.2013 was served upon the appellants proposing that the appellant has contravened Regulations 10 (d) (g) and (q) of CBLR, 2013. The revocation of CB Licence, forfeiture of the amount of security (₹ 75,000/-), submitted at the time of issue of the licence, was proposed alongwith the imposition of penalty. The said show cause notice for the sake of preparing the offence rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... artment that after receiving the information from Additional Directorate, DRI Headquarters, vide letter dated 10.05.2018, that a meticulous investigation in the form of conducting searches at various premises, in the form of recording of the statements of various people who were found the IEC Holders of the fictitious Companies as allegedly created by Shri Ramesh Wadhera and Shri Sanjeev Maggu, the Director of the appellant Company was called. It is impressed upon that the Director of the appellant was the master mind of diverting the warehoused goods to the domestic market. The statements being given to the Customs officers under Section 108 of the Customs Act are well admissible into evidence. Thus, there is sufficient evidence on record as a proof for the alleged illegal act on the part of the appellant. Hence, there is no infirmity in the Order under challenge. It is impressed upon that the impugned show cause notice cannot even be held to be barred by time as alleged. It is impressed upon that the time limit under Regulation 20(5) of CBLR, 2013 is mere directory and not mandatory in nature. Learned AR has relied upon decision of Hon'ble Apex Court in the case of Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s aim at securing interest of the customs house agent and also of the revenue. The urgency and expediency of the action permits the authority to step in immediately or with promptitude. A balancing of interests is achieved by ensuring prompt action and avoiding undue delay in taking it to its logical conclusion. Though word used in Regulation 20(5) is "shall" but in view of above observed aim of CBLR, we are of the opinion that the question as framed above would depend on the intention of the legislature and not necessarily merely by looking at the language in which it is clothed with. We opine that it is mandatory for the Court to look into the nature of the statute and the consequences which would follow from construing it in one way or the other, the ambit of the other provisions, the necessity of compliance of the provisions in question. Above all, whether the object of the enactment is defeated by holding it to be directory and whether the object would be achieved by construing it to be mandatory has to be considered. We draw our support from a decision of Hon'ble Apex Court in the case of Govindlal Chhaganlal Vs. Agriculture Produce Market Committee reported in AIR 1976 SC 26 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h circumstances, if the provision is construed in such a rigid form and no flexibility is allowed, though it results into declaration of the entire action of the revenue as illegal, it would not ensure justice rather shall defeat it? Merely because the inquiry was not completed within a stipulated period, the customs broker may not be allowed to walk free, as his suspension cannot be continued beyond the period prescribed in the Regulation and his licences need not be restored. The Hon'ble Apex Court in the case of Delhi Air take Services Pvt. Ltd. and another Vs. State of West Bengal and another reported in 2011(a) SCC page 354 has clarified the above position by quoting an example of criminal law. It observed: "where a statute imposes a public duty and proceeds to lay down the manner and time frame within which the duty shall be performed. The injustice or inconvenience resulting from a rigid adherence to the statutory prescriptions may not be relevant factor in holding such prescription to be only directory. For e.g., when dealing with provision relating to criminal law, legislative purpose is to be borne in mind for its proper interpretation. It is said that the purpose of c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which are beyond the control of the revenue if the time schedule is not adhered to, an accountability be fastened on the Revenue, to cite reasons why the time schedule was not adhered to, and then if the explanation offered is reasonable and is not reflecting the casual attitude on behalf of the Revenue rather there is apparent malafide on part of the CB, in that case the time line has to be considered directory only. Thus, the non compliance thereof cannot be the ground to vitiate the show cause notice. We draw our support from the decision in the case of Union of India Vs. R.S. Saini reported in 1999 (2) SCC 151 wherein Supreme Court held that the office memorandum fixing the time limit for completion of disciplinary proceedings is only a mid-line, non compliance of such office memorandum will not invalidate the punishment. The customs house agent, who is in a position of the delinquent and facing an inquiry is somehow similar to an inquiry in disciplinary proceedings on one hand and the revenue in the capacity of the administration on the other hand. CESTAT West Zonal Bench Mumbai also in Unison Clearing Pvt. Ltd. Vs. Commissioner of Customs (Tribunal Mumbai) held that if the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Authority has clearly observed the delaying strategy of the appellant's Director. Section 17 of Limitation Act while talking about effect of fraud or mistake lays that the fraud vitiates the limitation prescribed. Thus, those are not applicable to the present case. 12. In the light of the entire above discussion, when facts of this case are looked into, we observe that after the show cause notice was served upon the appellant tried to delay investigation by not joining the investigation. It is also observed that vide his letter dated 30.10.2017, Shri Sanjeev Maggu had stated that no firm in the name of M/s. Leo Cargo Services ever existed at the address on which the hearing notices were served. Thus, the malafide intentions to not to enable the DRI officials to unearth the modus operandi of committing the alleged illegal act were very much apparent on the record. These reasons are sufficient to hold that the inquiry officer could not maintain the time line of 90 days for submitting the report. Accordingly, we are of opinion that the customs house agent cannot be permitted to take benefit of his own wrong, on the ground that the process is not completed within the stipulated perio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the purpose of evasion of Customs duty. There are many such admissions apparent on record. The statements recorded under Section 108 of the Customs Act are the statements given to the Customs officers who are not the police officers. Hence, the immunity against admissibility of these statements into evidence is not available to these statements. There is no apparent retraction by any of the witnesses for these statements nor there is any other document apparently on record produced by the appellant which may even prima facie rebut the said oral evidence and the said admissions on record. Thus, we are of the opinion that the adjudicating authorities have committed no error while denying the opportunity to cross-examine these witnesses and in holding the appellant to have hatched the alleged conspiracy for clandestine removal of warehoused goods from public bonded warehouses to domestic market without payment of customs duty by floating fictitious importer firms. The Director of the appellant had committed forgery of documents for the purpose. Therefore, legal ground of the objection thereof is not sustainable due to the noticed mis-representation and fraud/ forgery. Hon'ble High ..... X X X X Extracts X X X X X X X X Extracts X X X X
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