By TIOL News Service

NEW DELHI , JULY 27, 2016. AGAINST the order passed by the Commissioner of Customs (General), Delhi revoking the CHA licence, an appeal was filed before the CESTAT which dismissed the same by holding thus -

Cus - appellant filed three shipping bills of ready-made garments namely Rayon Scarves on behalf of M/s Reliable Overseas (Exporter) under claim of drawback - Impugned goods were found to be overvalued for claiming undue export benefits - CHA licence of the appellant was revoked by Commissioner of Customs (General) – appeal to CESTAT. Held: It is an admitted fact that the appellant had not taken authorization from the exporter who was found to be non-existent and the goods were found misdeclared and highly overvalued - Nothing can possibly be a graver mis-conduct on the part of a CHA than to file Shipping Bills in the name of a non-existent exporter without making even preliminary enquiries about the genuineness of exporter in the name of which the documents were filed - Such dereliction of duty on the part of a CHA, can potentially have even graver financial/security consequences - Thus the appellant totally failed to discharge its duties as CHA thereby grossly violated Rule 13 of CHALR, 2004 - Such serious violation on the part of the CHA can hardly deserve any condonation or leniency - Having regard to the blatant and serious violation of the CHALR, 2004, it cannot be said that the penalty of revocation imposed by the Commissioner is arbitrary or unreasonable – No infirmity in the impugned order – Appeal dismissed: CESTAT [para 4, 5]

See 2015-TIOL-2602-CESTAT-DEL .

Aggrieved, the CHA is before the Delhi High Court.

The High Court observed that –

+ The offence report is the same for all the said noticees. It was received on 19th May 2011. In terms of Regulation 22 (1) of the CHALR 2004 (which corresponds to Regulation 20 (1) of the CBLR 2013), the SCN had to be issued within ninety days from 19th May 2011, i.e. on or before 18th August 2011. Instead the SCN was issued on 14th October 2011. Secondly, in terms of Regulation 22 (5) of the CHALR 2004, the enquiry had to be completed and a report submitted within 90 days of the issuance of the SCN under Regulation 22 (1). In the present case, it is not disputed that the inquiry report was submitted only on 16th January 2015 more than three years after the SCN dated 14th October 2011 was issued.

It was further noted that the CESTAT had proceeded on the basis of the seriousness of the violation and had made the following observation:

"Having regard to the blatant and serious violation of the CHALR 2004 as mentioned above, it cannot be said that the penalty awarded is unreasonable and revocation imposed by the Commissioner is arbitrary or unreasonable..."

Moreover, although the CESTAT recorded the submission of the Appellant regarding mandatory nature of the time limits under CHALR, 2004, in paragraph 3 of the impugned order, it failed to return any finding on the said aspect.

Adverting to the below mentioned judgments that dealt with the question of mandatory nature of time limits set out in CHALR, 2004 and the corresponding provisions under the CBLR, 2013 and where it was concluded that the revocation of the CHA licence is bad in law since the time limit for completion of the inquiry in terms of Regulation 22 (5) of the CHALR, 2004 had not been adhered to, the High Court held that the impugned order dated 10th April 2015 passed by the Commissioner of Customs (General), Delhi revoking the CHA licence of the Appellant is unsustainable in law and consequently the order of CESTAT affirming the same was also set aside.

++ Mr. Sunil Dutt, through Proprietor v. Commissioner of Customs (General), New Customs House] - 2016-TIOL-1135-HC-DEL-CUS ;

++ Indair Carrier Pvt. Ltd. v. Commissioner of Customs (General)] - 2016-TIOL-1111-HC-DEL-CUS ;

++ HLPL Global Logistics Pvt. Ltd. v. The Commissioner of Customs (General) - 2016-TIOL-1119-HC-DEL-CUS ;

++ Impexnet Logistic v. Commissioner of Customs (General) - 2016-TIOL-1069-HC-DEL-CUS .

++ Commissioner of Customs (General) v. S.K. Logistics - 2016-TIOL-845-HC-DEL-CUS ,

The appeal was allowed.

(See 2016-TIOL-1531-HC-DEL-CUS )