Mandatory ninety-day inquiry report deadline vitiates customs broker revocation proceedings and related suspension order

Regulation 20(5) of the Customs Broker License Rules, 2013 requires the inquiry report to be prepared and submitted within ninety days from the show cause notice, and the Madras High Court treated that period as mandatory rather than directory. Because the report was filed beyond time, the revocation process founded on it was unsustainable, and the connected suspension order could not survive as it depended on the same defective proceedings. The show cause notice and suspension order were therefore set aside on limitation grounds, while the authorities were left free to proceed afresh in accordance with law.

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Issues: (i) Whether the inquiry report under Regulation 20(5) of the Customs Broker License Rules, 2013, was required to be prepared and submitted within ninety days from the date of the show cause notice; (ii) Whether the suspension order could survive once the inquiry report and the ensuing proceedings were held to be time-barred.

Issue (i): Whether the inquiry report under Regulation 20(5) of the Customs Broker License Rules, 2013, was required to be prepared and submitted within ninety days from the date of the show cause notice.

Analysis: Regulation 20(5) requires the Deputy Commissioner or Assistant Commissioner to prepare the inquiry report and submit it within ninety days from the date of issue of notice under Regulation 20(1). The report in the case was prepared beyond that period. The time limit had been treated in prior decisions as mandatory and not merely directory, and once the prescribed period expired, the report could not be regarded as a valid report for continuation of the revocation proceedings.

Conclusion: The ninety-day period under Regulation 20(5) is mandatory, and the belated inquiry report was invalid.

Issue (ii): Whether the suspension order could survive once the inquiry report and the ensuing proceedings were held to be time-barred.

Analysis: The suspension order and the show cause notice formed part of the same statutory process for revocation or penalty. Since the inquiry report itself was filed beyond the mandatory period, the further steps contemplated by Regulation 20(6) and Regulation 20(7) could not be sustained. The suspension order, being dependent on the same defective proceeding, could not continue to operate.

Conclusion: The suspension order could not survive and was liable to be set aside.

Final Conclusion: The writ petitions were allowed, the show cause notice and suspension order were set aside on the ground of limitation, and the authorities were left free to proceed afresh in accordance with law.

Ratio Decidendi: Where the applicable customs broker regulations prescribe a time limit for completion and submission of the inquiry report, that time limit is mandatory, and a report filed beyond the prescribed period vitiates the downstream proceedings based on it.

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