TaxTMI 
TaxTMI 
2018 (4) TMI 685
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....toms Broker holding license bearing No.R-606-CHA, issued by the respondent. (ii) In the course of business, appellant had filed bills of entry No.2094269, dated 14.06.2017 and Nos.2128764 and 2131930, both dated 17.06.2017, on behalf of the importer, M/s.Benq India Private Limited, for import of goods described as BenQ Computer LCD Monitor with LED backlight and classified the same under tariff heading 8528 52 00 and also claimed benefit of Sl.No.17 of Notification No.24/2005-Cus, dated 01.03.2005, which exempts goods classifiable under tariff heading 8528 52, from the levy of duty. (iii) According to the appellant, tariff heading 8528 52 00, covers monitors, which are capable of directly connecting to and designed for use with an automatic data processing machine (computer). The appellant, adopted the said classification on the instructions of the importer. According to the appellant, for the same importer, the appellant has filed several bills of entry for import of various goods including computer monitors for the past six years and several crores of rupees have been paid as customs duty during such period. (iv) According to the appellant, the officers of Special Investigatio....
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....ant's licence, on a pure classification issue, the appellant, filed writ petition in W.P.No.27359 of 2017, before the Writ Court. 4. The appellant, inter alia, has contended as follows: (i) Though there is an effective remedy of appeal before the Tribunal, but chosen to challenge the same before the Writ Court, as the order has been passed by abusing and misusing the power conferred on the respondent and alternate remedy would not be efficacious and effective. (ii) Regulation No.18 of Customs Brokers Licensing Regulations, provides for revocation of licence or imposition of penalty. That the Commissioner of Customs, may subject to the provisions of the Regulation 20, revoke the licence of the customs broker and order for forfeiture of part or whole of security, or impose penalty not exceeding fifty thousand rupees on a customs broker on any of the grounds mentioned in clauses (a) to (f) being made out. (iii) In as much as the appellant did not advice their client to comply with the provisions of the Act and failed to exercise due diligence, to ascertain the correctness of the information and even assuming, ultimately, an order has been passed, it can at best be visited with....
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....n as the respondent has considered the factual situation, examined the conduct of the appellant and after affording full and effective opportunity, has passed the order continuing the suspension and as such, there is no error in the same. (iv) That the impugned order clearly states that the appellant has not been absolved from all the charges made against them in the suspension order dated 22.09.2017 and proceedings under Regulation 20 will follow. (v) That the interpretation given by the appellant that at best only penalty not exceeding rupees fifty thousand alone can be imposed is not tenable, as the proceedings under Regulation 20, is in the show cause notice stage. (vi) That there can be no res judicata in tax matters and the importer is entitled to adopt different classification for each bill of entry, it is submitted that the Court should take into consideration the facts of the case, which has been dealt with by the respondent, while continuing the order of suspension and as to how the word computer was inserted in the bill of entry, thereby, failing in their obligation contemplated under Regulation 9 of the Customs Brokers Licensing Regulations. (vii) In respect of iden....
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....nst such agent is pending or contemplated. Regulation 19(2) states that where a licence is suspended under sub-regulation (1), the Commissioner of Customs shall, within fifteen days from the date of such suspension, give an opportunity of hearing to the Customs Broker whose licence is suspended and may pass such order as he deems fit either revoking the suspension or continuing it, as the case may be, within fifteen days from the date of hearing granted to the Customs Broker. Proviso in Regulation 19 states that provided that in case the Commissioner of Customs passes an order for continuing the suspension, the further procedure thereafter shall be as provided in regulation 20. In the instant case, the power under Regulation 19(1), was invoked as in the opinion of the Commissioner of Customs, it was found that it is an appropriate case, where immediate action is necessary. In terms of sub-Regulation (2) of Regulation 19, opportunity of hearing was granted to the petitioner which was availed and the Commissioner has passed the impugned order continuing the suspension and stating that proceedings will be initiated under Regulation 20. In accordance with the said observations, show ca....
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....wever, the facts of the present case, calls for a different approach. The allegation against the petitioner was that in the bill of entry, the word 'computer', was deliberately added to the item description of goods , at the behest of the importer in violation of Section 46(4) of the Customs Act, with a view to claim duty exemption benefit. At the first blush, it appears the insertion of word computer , in the bill of entry, though alleged to be deliberate, cannot be construed as a serious matter. However, what is important to note is that the petitioner has been the Customs Broker for the importer for several years, they have been handling identical products for the very same importer and effecting clearances through Chennai Port. One such consignment covered in bill of entry dated 21.02.2011, was subject of check with regard to the classification adopted by the petitioner, the Customs Broker of the importer. As in the instant case, the classification was done as monitors of a kind solely or principally used in automatic data processing system under 8471. This classification was not accepted by the Department and an Order-in-Original, dated 18.01.2012, was passed, rejectin....
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....ter , to the 'item description' without seeking proper explanation from the importer, thereby violating Section 46(4) of the Customs Act. In such circumstances, it cannot be stated that the respondent did not properly exercise its discretion, while suspending the petitioner's licence under Regulation 19(1), nor it can be stated that the interpretation given by the respondent was either perverse or arbitrary not to bring the petitioner's case within the ambit of appropriate case in Regulation 19(1) . 12. It was further submitted that Regulation 19(1) could have been invoked only where immediate action is necessary and in the instant case, the order was passed on 22.09.2017, after nearly three months from the date of seizure of the consignment. The term immediate occurring in Regulation 19(1) should be interpreted in the context of the CBLR and therefore, there would be no room for adopting dictionary meaning for the word immediate occurring in Regulation 19(1). The bills of entry were filed by the petitioner on 17.06.2017. The goods were seized on 30.06.2017, after which statement was recorded from the Managing Director of the petitioner on 17.07.2017, statement w....
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....as filed the instant writ appeal. 8. Mr.Hari Radhakrishnan, learned counsel for appellant, briefly submitted the facts of the case, referred to the relevant provisions of the Act, regulations framed, and assailed the order of the Writ Court, inter alia, as follows: (i) That the order of respondent is liable to be set aside for non-adherence of the mandatory time limit prescribed in Regulation 19(2) of the Customs Brokers Licensing Regulations. (ii) That the suspension of a licence under Regulation 19 of Customs Brokers Licensing Regulations can be ordered where 'immediate action' is necessary. There is absolutely no threat to the interest of the Revenue if the appellant continues to function as a Customs Broker. The issue involved is a dispute regarding the correct classification of the goods namely whether the goods are 'computer monitors' or 'TV monitors'. Regulation 19 specifically requires that suspension can only be justified where immediate action is necessary. The respondent failed to justify the necessity to take 'immediate action' against the appellant. The continuation of suspension has not been supported by reasons. (iii) The appellant....
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....irming the description of the goods and other particulars were submitted to the respondent during the post-decisional hearing held on 28.09.2017. This clearly establishes that the appellant performed their role as a Customs Broker by forwarding the details as furnished by the importers. Further, the declaration was made on the bill of entry based on the instructions of the importer as contained in their letter dated 03.01.2017 and 01.06.2017. (ix) That the appellant filed the bill of entry after ascertaining the description of the imported monitor from the importer. The technical specification vouched to the truth of declaration made by the importer. (x) That the appellant filed the bill of entry claiming exemption in good faith based on importer's explanation, technical specification and exemption granted by Mumbai Customs for several imports made by various parties. In such circumstances, even if it is decided that the exemption is not to be granted, the appellant cannot to be penalized as abetter. (xi) That the allegation is the result of mis-conception on the part of the Customs as to use of LCD monitors under import. The appellant states that they are all monitors for u....
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....igh Court to issue a prerogative writ. It will be a sound exercise of discretion to refuse to interfere in a petition under Article 226 of the Constitution, unless there are good grounds to do, otherwise. 11.2. In C.A.Ibrahim v. ITO, AIR 1961 SC 609, H.B.Gandhi v. M/s. Gopinath & sons, 1992 (Suppl) 2 SCC 312 and in Karnataka Chemical Industries v. Union of India, 1999 (113) E.L.T. 17(SC) : 2000 (10) SCC 13, the Hon'ble Supreme Court held that where there is a hierarchy of appeals provided by the statute, the party must exhaust the statutory remedies before resorting to writ jurisdiction. 11.3. The general principles of law to be followed while entertaining a writ petition, when an alternative remedy is available, as per the decision of the Hon'ble Apex Court in U.P.State Spinning Co. Ltd. Vs. R.S.Pandey and Another (2005) 8 SCC 264, at para No.11 are as follows: "Except for a period when Article 226 was amended by the Constitution (Forty-Second Amendment) Act, 1976, the power relating to alternative remedy has been considered to be a rule of self-imposed limitation. It is essentially a rule of policy, convenience and discretion and never a rule of law. Despite the exist....
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....straint evolved by this Court, which every High Court is bound to keep in view while exercising power under Article 226 of the Constitution. 45. It is true that the rule of exhaustion of alternative remedy is a rule of discretion and not one of compulsion, but it is difficult to fathom any reason why the High Court should entertain a petition filed under Article 226 of the Constitution and pass interim order ignoring the fact that the petitioner can avail effective alternative remedy by filing application, appeal, revision etc., and the particular legislation contains a detailed mechanism for redressal of his grievance. 11.5. In Nivedita Sharma Vs. Cellular Operators Association of India and Others {(2011) 14 Supreme Court Cases 337}, the Hon'ble Apex Court held that, "An alternative remedy is not a bar to the entertaining of writ petition filed for the enforcement of any of the fundamental rights or where there has been a violation of the principles of natural justice or where the order under challenge is wholly without jurisdiction or the vires of the statute are under challenge. The Court has recognised some exceptions to the rule of alternative remedy. However, the hi....
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....y would be a mirage and an exercise in futility. 17. In the instant case, neither has the writ petitioner assessee described the available alternate remedy under the Act, as ineffectual and non-efficacious while invoking the writ jurisdiction of the High Court nor has the High Court ascribed cogent and satisfactory reasons to have exercised its jurisdiction in the facts of the instant case. In light of the same, we are of the considered opinion that the writ Court ought not to have entertained the writ petition filed by the assessee, wherein he has only questioned the correctness or otherwise of the notices issued under Section 148 of the Act, the reassessment orders passed and the consequential demand notices issued thereon. 18. In view of the above, we allow this appeal and set aside the judgment and order passed by the High Court in Chhabil Dass Agarwal Vs. Union of India {W.P.(c) No.44 of 2009, decided on 5/10/2010}. We grant liberty to the respondent, if he so desires, to file an appropriate petition/appeal against the orders of reassessment passed under Section 148 of the Act within four weeks' time from today. If the petition is filed before the appellate authority w....
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....A.Abraham Vs. ITO {(1961) 2 SCR 765}, Titaghur Paper Mills Co Ltd., Vs. State of Orissa {(1983) 2 SCC 433}, H.B.Gandhi Vs. Gopi Nath & Sons {1992 Supp (2) SCC 312}, Whirlpool Corpn Vs. Registrar of Trade Marks {(1998) 8 SCC 1}, Tin Plate Co. of India Ltd., Vs. State of Bihar {(1998) 8 SCC 272}, Sheela Devi Vs. Jaspal Singh {(1999) 1 SCC 209} and Punjab National Bank Vs. O.C.Krishnan {(2001) 6 SCC 569}, this Court held that where hierarchy of appeals is provided by the Statute, the party must exhaust the statutory remedies before resorting to writ jurisdiction. 12. During the course of hearing of the instant appeal, Mr.Hari Radhakrishnan, learned counsel for the appellant, stated that show cause notice under Regulation 20 of the Customs Brokers Licensing Regulations, 2013, dated 03.11.2017, has been issued and the appellant on receipt of the notice, is in the process of submitting their reply, to the proceedings under Regulation 20, which itself fortifies the views of the Writ Court, that matter requires adjudication by the appropriate authority. 13. As regards the contention of the learned counsel for the appellant with regard to non-adherence of the mandatory provisions prescrib....
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.... revoking the suspension or continuing it, as the case may be, within fifteen days from the date of hearing granted to the Customs Broker : Provided that in case the Commissioner of Customs passes an order for continuing the suspension, the further procedure thereafter shall be as provided in regulation 20. 20. Procedure for revoking licence or imposing penalty. (1) The Commissioner of Customs shall issue a notice in writing to the Customs Broker within a period of ninety days from the date of receipt of an offence report, stating the grounds on which it is proposed to revoke the licence or impose penalty requiring the said Customs Broker to submit within thirty days to the Deputy Commissioner of Customs or Assistant Commissioner of Customs nominated by him, a written statement of defense and also to specify in the said statement whether the Customs Broker desires to be heard in person by the said Deputy Commissioner of Customs or Assistant Commissioner of Customs. (2) The Commissioner of Customs may, on receipt of the written statement from the Customs Broker, or where no such statement has been received within the time-limit specified in the notice referred to in sub-regu....
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....peal by Customs Broker.- A Customs Broker, who is aggrieved by any order passed by the Commissioner of Customs under these regulations, may prefer an appeal under section 129A of the Act to the Customs, Central Excise and Service Tax Appellate Tribunal established under sub-section (1) of section 129 of the Act. 22. Penalty.- A Customs Broker, who contravenes any provisions of these regulations or who fails to comply with any provision of these regulations shall be liable to a penalty which may extend to fifty thousand rupees. (emphasis is ours) 14. We have gone through the Regulations contained in Customs Brokers Licensing Regulations, 2013, the submissions made by the learned counsel on either side and also the order impugned in the instant writ appeal. After considering the rival submissions, Writ Court, while dismissing the writ petition, directed the appellant herein, to submit their reply, to the show cause notice, dated 03.11.2017, within a period of 30 days, from the date of receipt of a copy of the order impugned herein and upon compliance of the directions contained in paragraph 15, of the show cause notice, the respondent shall adjudicate the show cause notice and....