M/s Zen Cargo Movers Pvt. Ltd. vs CC, New Delhi

Appeal is filed against order-in-original dated 20.8.2015 in terms of which the CHA licence of the appellant was revoked and forfeiture of the

whole amount of security deposit was ordered.

Ld. Advocate for the appellant pleaded that he is not arguing the issue on merit but only the issue of non-observance of the time lines prescribed in

the CHA Licensing Regulations, 2004 adding that the show cause notice in this case was issued on 17.7.2013 while the enquiry report was submitted

on 26.6.2015 which was beyond the time period prescribed in Regulation 22 of the said Regulations, and that such violation of the prescribed time limit

makes the impugned order unsustainable.

The Id. DR, on the other hand stated the said time lines are essentially directory in nature and therefore violation thereof would not be fatal to the

impugned order.

We have considered the contentions of both sides. The issue involves is violation of the time lines prescribed in Regulation 22 of the Regulations of

2004. The regulation is reproduced below:

Procedure for suspending or revoking licence under Regulation 20.-

(1) The Commissioner of Customs shall issue a notice in writing to the Customs House Agent within ninety days from the date of receipt of

offence report, stating the grounds on which it is proposed to suspend or revoke the licence and requiring the said Customs House Agent to

submit within thirty days to the Deputy Commissioner of Customs or Assistant Commissioner of Customs nominated by him, a written

statement of defense and also to specify in the said statement whether the Customs House Agent desires to be heard in person by the said

Deputy Commissioner of Customs or Assistant Commissioner of Customs.

Provided that the procedure prescribed in regulation 22 shall not apply in respect of the provisions contained in sub-regulation (2) to

regulation 20.

(2) The Commissioner of Customs may, on receipt of the written statement from the Customs House Agent, or where no such statement has

been received within the time-limit specified in the notice referred to in sub-regulation (1), direct the Deputy Commissioner of Customs or

Assistant Commissioner of Customs to inquire into the grounds which are not admitted by the Customs House Agent.

(3) The Deputy Commissioner of Customs or Assistant Commissioner of Customs shall, in the course of inquiry, consider such documentary

evidence and take such oral evidence as may be relevant or material to the inquiry in regard to the grounds forming the basis of the

proceedings, and he may also put any question to any person tendering evidence for or against the Customs House Agent, for the purpose

of ascertaining the correct position.

(4) The Customs House Agent shall be entitled to cross-examine the persons examined in support of the grounds forming the basis of the

proceedings, and where the Deputy Commissioner of Customs or Assistant Commissioner of Customs declines to examine any person on the

grounds that his evidence is not relevant or material, he shall record his reasons in writing for so doing.

(5) At the conclusion of the inquiry, the Deputy Commissioner of Customs or Assistant Commissioner of Customs shall prepare a report of

the inquiry recording his findings and submit his report within ninety days from the date of issue of a notice under sub-regulation (1).

(6) The Commissioner of Customs shall furnish to the Customs House Agent a copy of the report of the Deputy Commissioner of Customs or

Assistant Commissioner of Customs, and shall require the Customs House Agent to submit, within the specified period not being less than

thirty days, any representation that he may wish to make against the findings of the Deputy Commissioner of Customs or Assistant

Commissioner of Customs.

(7) The Commissioner of Customs shall, after considering the report of the inquiry and the representation thereon, if any, made by the

Customs House Agent, pass such orders as he deems fit within ninety days from the date of submission of the report by the Deputy

Commissioner of Customs or Assistant Commissioner of Customs, under sub-regulation (5).

(8) Any Customs House Agent aggrieved by any decision or order passed under regulation 20 or sub-regulation (7) of regulation 22, may

prefer an appeal under section 129A of the Act to the Customs, Central Excise and Service Tax Appellate Tribunal established under sub-

section (1) of section 129 of the Act.

It is evident from the above quoted regulation that under sub-regulation (5) thereof, the Deputy Commissioner is required to submit his inquiry report

recording his findings within 90 days from the date of issue of a notice under sub-regulation (1). In the present case, the notice under sub-regulation

(1) of Regulation 22 was issued on 17.7.2013 and the inquiry report by the Deputy Commissioner in terms of Regulation 22(5) was submitted more

than 22 months after that (on 26.6.2015). Sub-regulation (2) of Regulation 20 deals with suspension of licenses and therefore proviso to sub-regulation

1 of Regulation 22 has no relevance to the present proceedings.

The Hon'ble Delhi High Court inS hankar Clearing & Forwarding vs. CC (Import & General) - 2012 (283) ELT 349 (Del.,) the Hon'ble Madras High

Court in Sanco Trans Ltd. Vs. CC, Sea Port/Imports, Chennai - 2015 (322) ELT 170 (Mad. )t,his Tribunal in Rajeev Mayaer Vs. CC (Import &

General), New Delhi - 2014 (308) EL T 146 (Tri.-Del.), in Om Freight Forwarders Pvt. Ltd. Vs. CC (General), Mumbai - 2014 (311) ELT 793 (Tri.-

Mumbai) and in Sri Radhakrishna Shipping (P) Ltd. Vs. CC, (General), Mumbai - 2015 (318) ELT 660 (Tri.-Mumbai) have uniformly held that if any

of the intermediary steps such as issue of show cause notice, drawing up of an inquiry report, or passing of a revocation order is beyond the periods

mandated under Regulation 20 of the 2013 Licensing Regulations, (corresponding to Regulation 22 of the Customs House Agents Licensing

Regulation, 2004 as amended in 2010), the eventual order of revocation would be invalid.

For the aforesaid reasons and on the preceding analysis, the impugned order cannot be sustained and is accordingly quashed. Appeal is allowed.