2016 (12) TMI 758 - AT - Customs

Tribunal Overturns Customs Broker License Revocation Due to Delays

The Tribunal allowed the appeal filed by M/s MaaKrupa Forwarders concerning the revocation of their Customs Broker license due to significant delays in ... Revocation of CHA licence - time limitation - inordinate delay in the processes by Revenue - time limits prescribed under Customs Broker Licensing Regulations, 2013 (CBLR) for carrying out processes - amendment made in the Custom House Agent Licensing Regulations, 2004 (CHALR) vide Notification No. 30/2010-Cus (NT) dated 8.4.2010 prescribing various time limits - Held that: - it is obvious that none of the time limit prescribed under the CBLR, 2013 has been followed. In fact there has been as inordinate delay of exceptional nature. The matter has been delayed by almost three years beyond time limit and almost 4 times the prescribed time limit. This is a case of exceptional delay. It was obvious that there is lack of supervision and effort to adhere to the time limit prescribed by law. This will assume serious implications especially in view of the fact that Courts have held time limit to be mandatory in nature. By the miscellaneous application filed, the Revenue seeks the time of 8 to 12 months just to compile the data of such delays. Suffice to say in such a serious issue needs immediate attention of CBE&C and Chief Commissioner of Customs. As a result of such delay, a number of serious offenders will get the benefit and be left of the hook and go scot free, which is not the intent of law. Similarly, due to the delays, people who are not guilty will continue to suffer the suspension and revocation on account of delays by Revenue due to lack of responsibility. The appeal is allowed on limitation without going into merits of the case - The license which is revoked by the impugned order is restored forthwith and Commissioner of Customs (General), Mumbai is directed to do the needful immediately - decided in favor of CHA-assessee. Issues Involved:1. Delay in the revocation process of the Customs Broker license under CBLR, 2013.2. Adherence to prescribed time limits under CBLR, 2013 and CHALR, 2004.3. Mandatory versus directory nature of time limits.4. Impact of delays on the right to work and livelihood of the Customs Broker.5. Legal precedents on the mandatory nature of time limits.Analysis of Judgment:1. Delay in the Revocation Process:The appellant, M/s MaaKrupa Forwarders, challenged the revocation of their Customs Broker license, primarily arguing that there was an 'inordinate delay in the processes.' The learned Counsel pointed out that the Customs Broker Licensing Regulations, 2013 (CBLR) prescribe specific time limits for various actions by the Revenue, which were not adhered to in this case.2. Adherence to Prescribed Time Limits:The Tribunal noted that the CBLR, 2013 and CHALR, 2004 prescribe specific time limits for the issuance of Show Cause Notices, preparation of Inquiry Reports, and passing of Orders by the Commissioner. The Tribunal observed that 'none of the time limits prescribed under the CBLR, 2013 have been followed' in this case. The total duration allowed is 270 days or 9 months, but in this case, there was a delay of 1221 days.3. Mandatory versus Directory Nature of Time Limits:The learned Counsel for the appellant argued that the time limits prescribed under CBLR, 2013 are mandatory, citing decisions from the Hon'ble High Courts of Delhi and Madras. The Tribunal examined various decisions and concluded that the time limits are indeed mandatory. The Tribunal referenced the decision of the Hon'ble High Court of Delhi in Overseas Air Cargo Services and the Hon'ble High Court of Madras in Saro International Freight System, which emphasized the mandatory nature of the time limits.4. Impact of Delays on the Right to Work:The Tribunal highlighted that the appellant had been out of work for an extended period due to the delays, which infringed upon their fundamental right to work. The Tribunal cited the Hon'ble Supreme Court's decision in Olga Tellis & Ors vs. Bombay Municipal Corporation, emphasizing that the right to work is integrated with the right to life. The Tribunal noted that the delays not only affected the appellant but also indicated a systemic issue where other Customs Brokers might be similarly affected.5. Legal Precedents on the Mandatory Nature of Time Limits:The Tribunal relied on several legal precedents to support its conclusion that the time limits under CBLR, 2013 are mandatory. These included:- Overseas Air Cargo Services - 2016 (340) ELT 119 (Del)- Saro International Freight System - CDJ-2015 MHC-7964- INDAIR Carrier Pvt. Ltd. - 2016 (337) ELT 41 (Del)The Tribunal also noted that the Hon'ble High Court of Madras in Saro International Freight System observed that the use of the term 'shall' in the regulations indicates a mandatory requirement.Conclusion:The Tribunal concluded that the significant delays in the revocation process violated the mandatory time limits prescribed under CBLR, 2013. Consequently, the appeal was allowed on the grounds of limitation, and the revocation order was set aside. The Tribunal directed the Commissioner of Customs (General), Mumbai, to restore the appellant's license immediately. The Tribunal also emphasized the need for the CBEC and Chief Commissioner of Customs to address the systemic delays to ensure compliance with the prescribed time limits.