CHA licence suspension needs concrete factual basis; unsupported allegations under customs licensing rules cannot justify extraordinary action.

Suspension of a CHA licence under the 1984 Licensing Regulations requires a sustainable factual basis showing breach of the specific provisions invoked. On the record, the filing and follow-up of Bills of Entry could not be treated as unauthorised under Regulation 14(a) because Customs acted on those Bills, including cancellation of an earlier entry and assessment of a later one. The materials also did not establish that business in relation to the goods was transacted through the named employee for Regulation 14(b), and no specific finding supported the other invoked breaches. The suspension orders were therefore unsustainable, while inquiry proceedings could continue independently.

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Issues: Whether the suspension and confirmation of suspension of the CHA licence under Regulation 21(2) of the CHA Licensing Regulations, 1984 were sustainable on the alleged violations of Regulation 14(a) and Regulation 14(b).

Analysis: The Bills of Entry filed on behalf of the importer were acted upon by the proper officer of Customs, including cancellation of the earlier Bill of Entry and assessment of the later Bill of Entry. On that basis, the filing and follow-up of the Bills of Entry could not be treated as unauthorised so as to attract Regulation 14(a). As to Regulation 14(b), the record did not show that the CHA transacted business in relation to the subject goods through the employee named in the suspension orders. The materials also did not disclose any specific factual finding supporting the other invoked provisions of Regulation 14. In these circumstances, the foundation for the extraordinary step of suspension was absent, and the later inquiry under Regulation 23 did not save the impugned orders.

Conclusion: The suspension orders were not sustainable and were set aside, in favour of the assessee.

Final Conclusion: The licence suspension was quashed for want of sustainable material establishing the alleged regulatory violations, while leaving any inquiry under the licensing regulations open to proceed independently.

Ratio Decidendi: A CHA licence cannot be suspended on mere suspicion unless the record contains a sustainable factual basis showing unauthorised conduct or breach of the specific regulatory provisions invoked.

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