2022 (2) TMI 802 - AT - Customs

Tribunal Overturns Prohibition Order Due to Procedural Errors

The Tribunal ruled in favor of the appellant, a Customs Broker, finding the prohibition order invalid due to procedural deficiencies. The Commissioner's ... Suspension/revocation of Customs Broker License - prohibition order - Regulation 19/20 of Customs Broker Licensing Regulations, 2013 - CBEC Circular No. 9/2010-Customs - HELD THAT:- Ongoing through the relevant provisions of law and the Board‟s Circular issued in this regard, it is found that the prohibition order was issued by the Commissioner of Customs of the station where the appellants have been given licence whereas, the same is to be given only by the Commissioner of Customs where the Customs broker is permitted to operate under “C‟ form, in terms of the above cited circular. It is also found that till date the due notice for revocation of licence if any, as contemplated under Regulation 20 of CBLR, 2013, has been issued even after the lapse of the prescribed period of 90 days. It is also found that as submitted by the learned Counsel for the appellants, the said period is also over by a wide margin and as such no proceedings can be initiated against the customs broker, at this juncture, on the offence report given by Port authorities way back, under the said Regulation 20. Therefore, it is also found that the present appeal filed by the department is not maintainable either on the facts or on the law and is liable to be dismissed. The appeal filed by the Revenue is dismissed. Issues:1. Validity of the prohibition order issued against the customs broker.2. Compliance with the procedural requirements under Regulation 20 of Customs Broker Licensing Regulations, 2013 (CBLR, 2013).Analysis:Issue 1: Validity of the prohibition orderThe appellant, a Customs Broker, was alleged to have tampered with an import application, leading to a complaint and subsequent prohibition order issued by the Revenue. The Commissioner, after reviewing the case, revoked the prohibition order. The appellant argued that the prohibition order was invalid as it was issued by the authority who granted the license, not the Commissioner who permitted operation under 'C' form. The Tribunal agreed, citing CBEC Circular No. 9/2010-Customs, emphasizing the need for uniformity in adjudication. It noted the absence of a notice for revocation within 90 days as required by Regulation 20 of CBLR, 2013, rendering the prohibition order unsustainable. The Tribunal found the appeal by the Revenue not maintainable and dismissed it.Issue 2: Compliance with procedural requirementsThe appellant's counsel highlighted the procedural lapses in the case. The Regulation 20 of CBLR, 2013 mandates the issuance of a written notice within 90 days of receiving an offense report, followed by an inquiry. However, no such notice was issued even after six years, indicating a clear violation of the procedural safeguards. The Tribunal concurred, emphasizing the importance of due process and the appellant's right to be heard before any adverse action. The Tribunal noted the absence of any initiation or completion of an inquiry, further strengthening the argument that the prohibition order lacked a legal basis. Consequently, the Tribunal dismissed the Revenue's appeal, citing the lack of grounds for maintaining it under the law or facts of the case.In conclusion, the Tribunal upheld the appellant's position, declaring the prohibition order invalid due to procedural deficiencies and the absence of a timely notice for revocation. The judgment underscores the significance of following due process and regulatory requirements in administrative actions against customs brokers, ensuring fairness and adherence to legal standards.