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TMI Blog2023 (5) TMI 1166X X X X Extracts X X X X X X X X Extracts X X X X ..... de garments' for export to Sudan and Nigeria against 12 shipping bills of M/s Orient Exports that were taken up for investigation by Commissioner of Customs (Export), ACC, Mumbai as intimated by letter of 31st January 2014. The articles of charge relied upon the said letter of Commissioner of Customs (Export) as well as statements of two purported employees of M/s Millenium Freight Forwarders Pvt Ltd recorded on 19th November 2013 and it is the claim of the appellant that the two, viz., Mr Shailesh Watambale and Mr Ganesh Salaskar, were their employees in possession of 'customs pass' issued on their request of 4th July 2011 and 14th March 2012 respectively. 3. The licence had been initially suspended by the competent authority which, thereafter and in accordance with procedure prescribing 'post-decisional' hearing, was ordered on 5th March 2014 to be continued. The suspension was challenged and, taking note of the lack of any progress in proceedings under the Customs Broker Licensing Regulations, 2013 by then, the Tribunal [Order no. A/1768/14/CSTB/C-1 dated 9th December 2014] revoked the suspension while leaving it to licensing authority to continue the process envisaged un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on by the Hon'ble High Court of Bombay was, specifically, conditional upon completion of enquiry within three months with effect from 23rd September 2015; that no other issue, including adherence to 'time-lines' which, insofar as proceedings for revocation of licence is concerned, could be considered as relevant, was before the Hon'ble High Court is abundantly clear from '5. Needless to clarify that we have expressed no opinion on the rival contentions as far as legal question and also on the maintainability or continuation of the enquiry proceedings after the period specified under Regulation 19 and 20 of the Regulations.' therein. Thereby, issue of non-conformity with 'time-lines' prescribed in the Regulation is not beyond the scope of appellate resolution now. The plea entered on behalf of 'customs broker' on the status of the inquiry that had commenced by then, and noted thus '3. Mr. Shah for the respondent submits that the original file would indicate that the respondent has fully co-operated and has not sought unnecessary or frivolous adjournment and has not made a request contrary to the law. Rather on some occasions, the Inquiry Officer himself was not available. Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on a celebrated principle, when a statute prescribes a thing to be done in a particular manner, it must be performed in such a manner, the use of the word "shall" in the Regulation has been construed as mandatory. With due respect to the finding so recorded in the judgment of the Madras Court in case of Masterstroke Freight Forwarders P. Ltd. v. C.C.(I), Chennai-I, reported in 2016 (332) ELT 300 (Madras) delivered by the Learned Single Judge, the parameters of construing a provision as mandatory or directory, when it deals with a discharge of a public duty and a resultant consequence has not been specifically taken into consideration. The salutary principle, whether statute imposes a public duty and lays down the manner and time within which the duty shall be performed, the injustice or inconvenience resulting from a rigid adherence to the statutory prescription, is a relevant factor for holding such provision only as directory has been completely overlooked. As observed by Justice Denman in Caldow v. Pixell, (1877) 2 CPD 562, "in considering whether the statute is imperative, the balance may be struck between inconvenience or sometime rigidly adhered to, or sometime departure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its earlier view in Unison Clearing Pvt. Ltd. (supra) and after referring to certain precedents where a view was taken that the regulations are mandatory delivered by the Tribunal itself, the Tribunal was pleased to quash and set aside the impugned order being not sustainable and allowed the appeals. It is to be noted that the Member Judicial (Ramesh Nair) who is a party to the judgment delivered by the said CESTAT in Unison Clearing Pvt. Ltd. v. Commissioner of Customs (General), Mumbai. 15. In view of the aforesaid discussion, the timelimit contained in Regulation 20 cannot be construed to be mandatory and is held to be directory. As it is already observed above that though the time line framed in the Regulation need to be rigidly applied, fairness would demand that when such time limit is crossed, the period subsequently consumed for completing the inquiry should be justified by giving reasons and the causes on account of which the timelimit was not adhered to. This would ensure that the inquiry proceedings which are initiated are completed expeditiously, are not prolonged and some checks and balances must be ensured. One step by which the unnecessary delays can be curbed is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to employment by appellant and, therefore, cannot be said to have excluded them from being their employees authorized to handle processes that a customs broker undertakes. It was also pointed out that it was not unusual for new customers to be brought in on reference from 'freight forwarders' instead of directly from the exporters themselves. Furthermore, he contends that the alleged overvaluation of the export consignment had no causal connection with the manner in which M/s Orient Exports came to be their customer. 11. According to Learned Authorised Representative, the inquiry authority had carried out examination-in-chief of the two employees of M/s Millenium Freight Forwarders in which the earlier deposition, in statements recorded under section 108 of Customs Act, 1962, of being employees of M/s Millenium Freight Forwarders was confirmed. It was also pointed that, while applying for customs pass for these two persons, the appellant had clearly stated that they were full-time employees of the appellant while the facts now established the contrary. He contended that confusion by the 'authorised person' of the appellant to receiving payments from these two persons sufficed as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cess of the credentials, necessary for undertaking customs clearance, to persons not in their employment. The submission of customs broker, and not controverted in the impugned order, that access was provided only to privately sourced software used for compilation of data to be filed under ICEGATE strikes at the very root of the allegation of illicit grant of access. Hence, the conclusion that the appellant had not obtained authorization from the customer is a conclusion that may not sustain. It is clear from letter dated 20th July 2013 that authorization had been obtained by them, albeit indirectly, from M/s Millenium Freight Forwarders Pvt Ltd. Insofar as the allegation that regulation 11(d) of Customs Broker Licensing Regulations, 2013 had been breached is concerned, it would appear that the charge has been upheld on the alleged role of the two employees of M/s Millenium Freight Forwarders Pvt Ltd. In the light of our finding supra that such employment with M/s Millenium Freight Forwarders Pvt Ltd did not preclude employment with the appellant and that same employees had been issued with customs pass as employees of appellant, the finding against the appellant does not stand. Br ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Soon after the cargo and papers were received, the formalities of registration were completed and the cargo was presented before the proper officer. This is not the case of Revenue that the documents presented were not in accordance with the procedure relating to clearance of export goods. In our view the word 'efficiency' as used in Regulation 13(n) indicates that the CHA is under an obligation to ensure that all the requisite details are given in the declarations which are prepared as per the details/declarations given by the exporter. It is not the case of the department that the details that are given by the exporter and mentioned by the CHA in the documents are different and therefore it can't be said that the CHA did not perform his duty with efficiency. We concur with the submission of ld. counsel for the Appellants that there is no obligation on a CHA or his employee to check, verify the contents of the cargo or to verify the value to ascertain whether the declarations made by the exporter are correct or otherwise. No CHA can empower its employee to open any package, which comes in sealed condition, to check the contents therein because then there would be complains and all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut to first check examination and the importer very well exists. Similarly the export consignment was received in a sealed container duly examined and certified by the jurisdictional Central Excise authorities. The exporter is also existing. Bills of entry and shipping bill were filed by the appellants based on the documents furnished by the importer/exporter. If there was any irregularity in the documents then the same was also available before the assessing officers and the Customs examining officer. If the same could not be detected by the appellant the same also could not be detected by departmental assessing/examining officers. There is no evidence on record that appellant came to know of any irregularity before the same were detected by the department or that he did not advise the concerned clients. Appellant was also exonerated by the departmental inquiry officer. It is also observed that the points of difference from the Inquiry report are not so glaring to justify revocation of CHA license as held by the adjudicating authority. The whole spirit of obligation of the CHA under the CHALR is to establish the identity of the importer/exporter and appropriately advise his client ..... X X X X Extracts X X X X X X X X Extracts X X X X
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