Customs broker licence suspension pending inquiry u/reg 17(1) timelines, set aside after 11-month delay

Regulation 17(1) of the Customs Brokers Licensing Regulations mandates that the Principal Commissioner initiate proceedings within 90 days of receipt of the offence report, and the regulatory scheme requires timely completion of inquiry steps. Where the Customs Broker licence was suspended and, despite appointment of an inquiry officer, no inquiry was conducted for nearly 11 months and no final decision was taken within the prescribed timeline, the continued suspension was held unsustainable, applying the HC view that mere formal steps without timely completion do not satisfy the 90-day requirement. The order confirming suspension was set aside and the authorities were directed to restore normal functioning of the Customs Broker; appeal allowed.

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1. ISSUES PRESENTED AND CONSIDERED

(i) Whether the continued suspension/confirmation of suspension of a Customs Broker licence could be sustained when proceedings under Regulation 17 of the Customs Broker Licensing Regulations, 2018 were not initiated and carried forward within the prescribed timelines from the offence report.

(ii) Whether non-conduct of inquiry despite appointment of an Inquiry Officer, coupled with prolonged inaction, vitiated the confirmation of suspension and required restoration of normal functioning.

2. ISSUE-WISE DETAILED ANALYSIS

Issue (i): Effect of failure to initiate and complete action under Regulation 17 within prescribed time limits

Legal framework: The Court examined Regulation 17 of the Customs Broker Licensing Regulations, 2018, including: (a) initiation of proceedings by issuance of notice within 90 days from receipt of the offence report; (b) submission of the Inquiry Officer's report within 90 days from issuance of notice; and (c) passing of final decision within 90 days from the inquiry report.

Interpretation and reasoning: The Court found that, although an Inquiry Officer had been appointed, no inquiry had been conducted and no action had been initiated as contemplated under Regulation 17, even though nearly 11 months had elapsed after the licence suspension. The Court treated the prescribed timelines as mandatory, applying the relied-upon precedents on mandatory compliance with the time limits under the licensing regulations.

Conclusion: The confirmation of suspension was held unsustainable due to violation of the mandatory time-bound procedure under Regulation 17, warranting interference.

Issue (ii): Whether prolonged inaction after suspension, despite appointment of Inquiry Officer, invalidated the confirmation of suspension and required restoration of operations

Interpretation and reasoning: The Court considered the admitted position that, despite the suspension having been ordered earlier, no inquiry was conducted and statutory steps were not pursued. This prolonged inaction was treated as contrary to the scheme of Regulation 17 requiring timely progression of proceedings.

Conclusion: The Court set aside the order confirming suspension and directed that the customs broker be permitted to resume normal functioning with immediate effect.

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