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TMI Blog2021 (9) TMI 380X X X X Extracts X X X X X X X X Extracts X X X X ..... t been authorised under the law and it shall act only in the manner it has been authorised by law - The impugned order of corrigendum under Section 154 of the Customs Act, 1962 is not sustainable in law since in the name of rectification of clerical or arithmetical or typographical mistake neither any additional penal order of suspension of licence can be inserted nor any fresh condition can be imposed for restoration of Customs Broker licence when the punishment of suspension of licence itself had no existence in the original order of adjudication. Whether the term Security deposit has the same nature and character legally as of Duty and Penalty ? - whether by mere pre-deposit of 7.5% of the penalty amount imposed in the original adjudication order, in filing the appeal would amount to automatic stay or revocation of the order of the forfeiture of security deposit passed in the original adjudication order against which appeal has been filed? - HELD THAT:- The term Security deposit cannot be equated with the term Penalty or Duty and their nature and character are totally different since security deposit does not arise out of any demand and Security Deposit is a co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner. Petition disposed off. - W.P.O. No. 203 of 2021 I.A. No. GA/1/2021 - - - Dated:- 6-9-2021 - MD. NIZAMUDDIN, J. For the Petitioner :- Mr. Arijit Chakrabarti, Adv. Mr. Nirmal Kr. Chowdhury, Adv. Mr. Prabir bera, Adv. For the Respondent :- Mr. K.K. Maiti, Adv. Heard Learned Counsel appearing for the parties. In this Writ Petition petitioner has challenged the respondents action of displaying of Alert in the Customs EDI system as appears at Page 71 of the Writ Petition purported to be uploaded on 18th March, 2021 and displaying that petitioner s licence as Customs Broker has been suspended on 15th March, 2021 and further challenged the impugned order of corrigendum passed by the respondent Commissioner of Customs, under Section 154 of the Customs Act, 1962, by way of an application being CAN No. 1 of 2021 which appears at page 14 of the said application which is attested copy of the communication made to the petitioner by a letter dated 03.05.2021 as appears at page 13 of the said application intimating that Para 32 (iii) of the original order of adjudication dated 3rd March, 2021 has been rectified by inserting that order of restoration of licence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed connected application being GA No. 1 of 2021 challenging the impugned order of corrigendum passed by the Principle Commissioner of Custom (A A) under Section 154 of the Customs Act, 1962 purported to be passed in April, 2021 which does not contain date and signature of the Commissioner who has passed such order as appears at page 14 of the said application though it shows attestation of the said order of corrigendum, by the appraiser customs broker section, on 3rd May, 2021 as appears at page 13 of the aforesaid connected application. Learned Advocate appearing for the petitioner submits that the appeal of the petitioner against the adjudication order dated 3rd March, 2021 which was filed after making pre-deposit of 7.5% of the penalty imposed as per relevant law, on legality of the aforesaid two issues, is pending before the Ld. Tribunal. He also submits that there is no whispering about suspension of petitioner s Customs Broker Licence in the said original adjudication order dated 3rd March, 2021 and it contains only imposition of penalty of ₹ 50,000/- and forfeiture of security deposit and petitioner was surprised to find Alert in the customs EDI system on 18t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt dated 15th March, 2021 showing suspension of licence of the petitioner and the said corrigendum/rectification under Section 154 of the Customs Act as appears at page- 14 of the application being CAN No. 1 of 2021 are after passing of the original order of adjudication dated 3rd March, 2021. Petitioner relies on a circular no. 502/68/99-CX dated 16th December, 1999 issued by the Ministry of Finance, Department of Revenue (Central Board of Excise Custom), Government of India, in support of his contention that there cannot be any significant change or alteration in the original adjudication order and only clerical or arithmetical or typographical mistake can be corrected under Section 154 of the Customs Act, 1962 and the authority should take recourse to review for any significant change or alteration in the original adjudication order. He has further relied on a circular no. 788/21/2004-CX dated 25th May, 2004 issued by the Ministry of Finance, Department of Revenue (Central Board of Excise Custom), Government of India in support of his contention that officer concern should refrain from taking coercive action for recovery of the demand raised in the order of adjudicati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er and for non-compliance of the order of adjudication dated 3rd March, 2021 by not paying the penalty and full amount of fresh security deposit, in EDI system of Customs with effect from 15th March, 2021 it was showing Alert and suspension of licence and the petitioner has no security deposit to continue with its business transaction. Learned Advocate appearing for the respondent customs authority submits that the petitioner s licence has neither been revoked nor suspended, it is simply Alert in the system but he could not show the formal order of suspension passed by the Commissioner or show any provision of law or any guideline under which circumstances and when and in which case the said Alert and Suspension could be displayed in Customs EDI system which is penal in nature infringing the petitioner s right to livelihood. Respondents customs authority themselves have admitted in their affidavit-in-opposition to the G.A. No. 1 of 2021 in Paragraph 3 (b) that order of suspension of the petitioner s Customs Broker licence was passed on 15th March, 2021 but it has failed to annex in his affidavit any formal order of such suspension of the licence of the petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Customs Act, 1962 has relied on several judgments which are as follows: (a) 1997 (95) E.L.T. 33 (Mad.) (Collector of Customs Central Excise, Madurai vs- Samudram) (b) 2019 (365) E.L.T. 802 (Mad.) (Commissioner of Customs (portimports), Chennai vs- Volvo India Pvt. Ltd.) (c) 1996 (83) E.L.T. 41 (Ker.) (Union of India vs- Aluminium Industries Ltd.) (d) Civil Appeal No. 1171 of 2004 Supreme Court of India (Assistant Commissioner of Income Tax, Rajkot vs- Saurashtra Kutch Stock) dated 15th September, 2008 Learned Advocate appearing for the respondents could not deny that in the instant case original order of adjudication was passed on 3rd March, 2021, and at the time of passing such order the aforesaid licence of the petitioner was not suspended and only the punishment of forfeiture of security deposit was ordered in addition to imposition of penalty. He has submitted that petitioner s Customs Broker Licence was suspended for a considerable period in implementation of the original order of adjudication and as a consequence of non deposit of fresh security deposit petitioner was not allowed to transact its business. He submits that order of corrige ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in from any accidental slip or omission may, at any time, be corrected by the Central Government, the Board or such officer of customs or the successor in office of such officer, as the case may be. Some relevant Regulations of the Customs Brokers Licensing Regulation, 2018 are as follows: Regulation 8. Execution of bond and furnishing of security.-(1) Before granting the license under regulation 7, the Principal Commissioner or Commissioner of Customs shall require the successful applicant to enter into a bond in Form D and where specified a surety bond in Form E for due observance of these regulations and furnish a bank guarantee, or a postal security or National Saving Certificate or a fixed deposit receipt issued by a nationalised bank, in the name of the Principal Commissioner of Customs or Commissioner of Customs, as the case may be, for an amount of five lakhs rupees for carrying out the business as a Customs Broker. (2) In cases where a postal security or National Saving Certificate or a fixed deposit receipt is furnished, the benefit of interest on the instrument shall accrue to the Customs Broker concerned. Regulation 16. Suspension of license. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of licence of Customs Broker under the Customs Act, 1962 or under the Customs Brokers Licensing Regulations, 2018? (ii) Whether Commissioner of Customs after passing the final adjudication order and when there is any enquiry proceeding pending or contemplating as per Regulation 16 (1) of the Customs Brokers Licensing Regulations, 2018, has the jurisdiction to pass order suspending the licence of the Customs Broker by waving or dispensing with the formalities of Regulation 16 (1) and (2) of the Customs Brokers Licensing Regulations, 2018. (iii) Whether any provisions of Customs Act, 1962 or Customs Brokers Licensing Regulations, 2018 confers such power of discretion upon the Commissioner of Customs to waive or dispense with the formalities of Regulation 16 (1) (2) of the aforesaid Regulations for suspending the licence of a Customs Broker? (iv) Whether in exercise of power under Section 154 of the Customs Act, 1962 can Commissioner of Customs, by way of corrigendum insert additional order of punishment by suspending Customs Broker licence of the petitioner or put conditions of restoration of licence of Customs Broker and make substantial and significant al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hown or placed before me as to when the formal penal order of punishment of suspension of Brokers Licence of the petitioner was passed and neither it has annexed in its affidavit-in-opposition to the Writ Petition and connected application and also no documents were produced to show that statutory criteria under Regulation 16 (1) were fulfilled and formalities of Regulation 16 (2) of the aforesaid Regulations were observed before passing the order for suspending such licence. Regulation 18 (3) of the Customs Brokers Licensing Regulations, 2018 upon which learned Advocate for the respondents Customs authority has relied for justifying the action of suspending of the aforesaid licence without observing the statutory formalities of Regulation 16, according to me nowhere in Regulation 18 (3) it confers any power upon the Commissioner of Customs to dispense with or waive the statutory obligation and formalities under Regulation 16 of the said Regulations for suspending the aforesaid licence and the respondents could not show any provision of law relating to concept of automatic or Deemed Suspension of Customs Broker licence under the Customs Act, 1962 or Customs Brokers Licensing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the original order of adjudication by way of imposing additional penalty or putting conditions restoration of licence in the name of correcting clerical, arithmetical or typographical mistake when in the original order of adjudication there is mentioning of suspension of licence at all. It has been brought to my notice the circular no. 502/68/99-CX dated 16th December, 1999 issued by the Ministry of Finance, Department of Revenue (Central Board of Excise Custom), Government of India, with regard to action of corrigendum subsequent to adjudication order passed by the Departmental Authorities, opinion was sought from the Law Ministry and it appears from the said Circular dated 16th December, 1999 that on that basis of opinion of Ministry of Law, advice has been issued to the department and to all concerned that where any significant change in the order becomes necessary after the order has been passed which cannot be termed as clerical or arithmetical or typographical mistakes, in such cases review might be mooted instead of taking recourse to corrigendum and that after the order of adjudication, authority passing such order becomes functus officio as appears from the aforesai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out pre-deposit of certain percentage of duty demand or penalty imposed before filing appeal and nowhere it talks anything about the security deposit. Contention of the learned Advocate for the petitioner that no coercive action can be taken after filing the appeal by making pre-deposit of the percentage of penalty prescribed under Section 129E of the Act by no stretch can enlarge the scope to the extent that the pre-deposit of penalty imposed in the adjudication order against which appeal has been filed would amount to automatic stay of the order of the forfeiture of security deposit or revocation of the order of the forfeiture of the security deposit. All the circulars/notifications referred above which has been relied upon by the petitioner in support of his contention that by mere filing of appeal upon payment of certain percentage of penalty under Section 129E of the Customs Act, 1962, order of forfeiture of security deposit would automatically stand stay is not tenable in the eye of law since none of those circular talks about Security Deposit and such contention is not supported by any Act, circular or notification. All the circulars and notifications and regulations and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clear from the conduct of the petitioner that it has made pre-deposit of 7.5% of the penalty only and not pre-deposit of any percentage of amount of security deposit which has been forfeited by the adjudicating authority. Petitioner has relied on Paragraph- 69 of the decision of the Hon ble Supreme Court in the case of Dharam Dutta vs- Union of India reported in AIR 2004 Supreme Court 1295, on perusal of which I find it is in a different context and has nothing to do with the contention of the petitioner in its case about automatic stay/revocation of the order of forfeiture of security deposit by mere making pre-deposit of 7.5% of the penalty, in Appeal before the Appellate Authority against the original order of adjudication on the ground that the issues remains alive so long it is not decided by the Appellate authority and the petitioner is not bound to make fresh security deposit. So far as contention of the petitioner that the issue which is subject matter of appeal and if the same is pending and so long it is not decided by the Appellate Authority it does not reach its finality, with the deepest respect that it is undisputed and settled proposition of law. Paragraph- 69 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of facts as well as law and in such event the correctness of the judgment is in jeopardy. In my considered opinion Petitioner cannot equate the power of the Customs Tribunal where its appeal is pending with the power of the Hon ble Supreme Court under Article 136 of the Constitution of India. I feel that Paragraphs 13 and 14 and of the aforesaid judgment are also relevant and should be read along with Paragraph - 38 of the said judgment of the Hon ble Supreme Court and on reading the same together it will appear that the aforesaid judgment has no manner of application in the facts involve in the case of the petitioner: 13. It may be true that by reason of Section 46A of Indian Railways Act the judgment of the Tribunal was final but by reason thereof the jurisdiction of this Court to exercise its power under Article 136 of the Constitution of India was not and could not have been excluded. 14. Article 136 of the Constitution of India confers a special power upon this Court in terms whereof an appeal shall lie against any order passed by a Court or Tribunal. Once a Special Leave is granted and the appeal is admitted the correctness or otherwise of the judgment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of adjudication on 03.03.2021 wherein there is no whispering of suspension of petitioner s Customs Broker Licence and in absence of any formal order of suspension of the aforesaid licence which is penal in nature restricting business transaction of the petitioner without fulfilling the criteria under Regulation 16 (1) and observing the formalities of Regulation 16 (2) of the Customs Brokers Licensing Regulations, 2018 and the failure of the respondents Customs adjudication authority to place any statutory provision, notification or any guideline in this regard in support of such penal action, is not legal and valid and not sustainable in law. (iv) In my considered opinion, in exercise of power of rectification under Section 154 of the Customs Act, Commissioner of Customs cannot by way of corrigendum insert additional punishment of suspension of Customs Broker Licence or impose conditions for revocation of suspension of Customs Broker Licence of the petitioner in the original adjudication order in the name of correcting clerical, arithmetical or typographical mistake since additional punishment of suspension of the aforesaid licence or imposing of conditions for revocat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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