TaxTMI 
TaxTMI 
TaxTMI 
2024 (2) TMI 26
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....repared within the 90 days from the date of show cause notice. 2.1 It has been argue that there is the delay of 66 days over and above the 90 days time limit prescribed under Regulation 17 (5). It was further pointed out that Regulation 17 (7) requires the final order to be passed within 90 days from the date of enquiry report. 2.2 It was argued that there was a delay of 31 days over and above the 90 days limit prescribed Regulation 17 (7) of the CBLR, 2018. The learned Counsel argued that the time limits prescribed under the Customs Broker Licensing Regulation, 2018 are mandatory and failure to follow the said time limits vitiates the entire proceeding. 2.3 The learned Counsel further pointed out that during the enquiry no statement of Shri Ashok Bhanushali the main partner of the appellant firm was recorded. The enquiry report suggests that summons dated 12.04.2012, 14.04.2022 and 12.5.2022 were issued to Shri Ashok Bhanushali but he failed to appear. Learned Counsel Pointed out that only two summons were received through e-mail and Shri Ashok Bhanushali failed to appear as his Brother-in-law was suffering from cancer at advance stage and was hospitalized. 2.4 It was argued t....
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....use Notice dtd. 04/11/2022 Was required to be issued on or before 21/10/2022 Delay after 90 days' time limit is - 14 days 17(5) Inquiry Report to prepared within 90 days from the date Show-cause Notice Show-cause be Notice dtd. 04/11/2022 Inquiry of Report dtd. 11/04/2023 Was required to be passed on or before 04/02/2023 Delay after 90 days' time limit is - 66 days 17(7) Order of Revocation (Impugned Order) to be passed within 90 days from the date of Inquiry Report. Inquiry Report dtd. 11/04/2023 Order of Revocation (Impugned Order) dtd. 11/08/2023 Was required to be passed on or before 11/07/2023 Delay after 90 days' time limit is - 31 days There have been various decisions on the issue whether the time limits prescribed in the CBLR, 2018 are directory or mandatory in nature. 4.2 The coordinate bench of Tribunal in the case of Krishna Shipping and Allied Services vide final order dated 06.10.2023 has examined these decisions and come to the conclusion that the time limits prescribes are mandatory. In the case of Krishna Shipping and Allied Services (Supra) following has been observed:- "23.1 Further, we also find that the matter regarding time lines as we....
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....B), Impexnet Logistic v. Commissioner of Customs (General) (iii) 2014 (310) E.L.T. 673 (Mad DB), Commissioner of Customs (Seaport Import), Chennai v. CESTAT, Chennai; (iv) a Division Bench decision of this Court made in CMA No. 730 of 2016 dated 13-10-2017. (v) 2016 (340) E.L.T. 119 (Del), Overseas Air Cargo v. CC; (vi) 2016 (337) E.L.T. 41 (Del), Indian Carrier P. Ltd. v. CC. 7. Per contra, the contentions of the Learned Counsels appearing for the respondents are as follows : (a) The limitation prescribed under the relevant regulations is not mandatory, since no consequence follows for not following the time limit. In other words, the relevant regulations do not stipulate any consequence, if a particular act is not done within the time limit prescribed in the regulation. Therefore, the time limit prescribed is only directory and not mandatory as claimed by the petitioners. The power to issue regulations emanates under Section 146 of the Customs Act, which deals with the issuance of license to the petitioners. The said provision does not stipulate any time limit. The regulations are delegated legislation and therefore, they cannot go beyond the parent Act. When the....
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.... show cause notice issued with a proposal to revoke the order of suspension/order imposing penalty under the relevant regulations. The impugned proceedings were passed/issued based on certain allegations that the respective writ petitioners have violated the terms of the license issued to them under the relevant regulations. The facts and circumstances warranting issuance of impugned proceedings differ from case to case. Since these writ petitions are filed by questioning the very jurisdiction of the Authorities concerned in issuing the impugned proceedings beyond the time prescribed under the relevant provisions for doing each act, the factual allegations made against these petitioners warranting issuance of impugned proceedings are not being dealt with in these writ petitions, as this Court is called upon to decide as to whether the limitation period prescribed under relevant regulations for doing each act commencing from the issuance of an order of suspension up to passing of a final order in pursuant to issuance of show cause notice, is mandatory, as claimed by the petitioner or directory, as claimed by the respondents. Thus, this Court confines the discussion of the matter onl....
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....lso to specify in the 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-regulation (1), direct the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be, to inquire into the grounds which are not admitted by the Customs Broker. (3) The Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be, shall, in the course of inquiry, consider such documentary evidence and take such oral evidence as may be relevant or material to the inquiry in regard to the grounds forming the basis of the proceedings, and he may also put any question to any person tendering evidence for or against the Customs Broker, for the purpose of ascertaining the correct position. (4) The Customs Broker shall be entitled to cross-examine the persons examined in support of the grounds forming the basis of the proceedings, and where the Deputy Com....
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.... case, the Commissioner passes an order for continuing the suspension, further procedure thereafter shall have to be followed as provided under Regulation 20. 14. Under 20(1) of the Regulations, the Commissioner shall issue a notice to the Customs Broker within a period of 90 days from the date of receipt of an offence report, stating the grounds on which he proposes to revoke the license or impose penalty. The Customs broker should submit a written statement of defense within 30 days from the date of receipt of the said show cause notice. Regulation 20(2) contemplates that on receipt of the written statement from the customs broker within the time stipulated, the Commissioner of Customs may direct the Deputy Commissioner of Customs or Assistant Commissioner of Customs to conduct an enquiry. Regulation 20(5) stipulates that at the conclusion of the enquiry, the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be, shall prepare a report of the enquiry and after recorded his findings thereon, submit the said report within a period of 90 days from the date of issue of the show cause notice. Thus, it is evident that the 90 days prescribed under su....
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....quiry on 25-4-2018. However, the third respondent prepared the report only on 14-8-2018, which is evident from the perusal of the said report itself, made available in the typed set of papers. Therefore, it is clear that the third respondent has prepared the said report on 14-8-2018, which is undoubtedly beyond the period of 90 days from the date of issuance of the show cause notice. At this juncture, it is relevant to quote Regulation 20(5) of the said Regulations, which reads as follows : "20. Procedure for revoking licence or imposing penalty. ...(5) At the conclusion of the inquiry, the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be, shall prepare a report of the inquiry and after recording his findings thereon submit the report within a period of ninety days from the date of issue of a notice under sub-regulation (1)." 8. Perusal of the above Regulation clearly indicates that such report on conclusion of the inquiry shall be prepared and submitted within a period of 90 days from the date of issue of notice under sub-regulation (1). It is contended by the respondents that the time stipulated under Regulation 20(5) for filing suc....
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....ds not accepted by CHA, by reducing the time to thirty days in both the cases under the Regulations." 7. This Court has consistently emphasised the mandatory nature of the aforementioned time limits in several of its decisions. These include the decision in Schankar Clearing & Forwarding v. C.C. (Import & General) 2012 (283) E.L.T. 349 (Del.), the order dated 25th April, 2016 passed by this Court in Customs Appeal No. 14/2016 (Commissioner of Customs (General) v. S.K. Logistics) and the order dated 29th April, 2016 in W.P.(C) No. 3071/2015 (Sunil Dutt v. Commissioner of Customs (General) New Customs House). The same position has been reiterated by the Madras High Court in Sanco Trans Ltd. v. Commissioner of Customs, Sea Port/Imports, Chennai - 2015 (322) E.L.T. 170 (Mad.) and Commissioner v. Eltece Associates - 2016 (334) E.L.T. A50 (Mad.)." 8. Recently by an order dated 24th April, 2016 in W.P. (C) No. 1734/2016 [HLPL Global Logistics Pvt. Ltd. v. The Commissioner of Customs (General) [2016 (338) E.L.T. 365 (Del)] this Court reiterated that the time-limits in Regulation 20 of the CBLR/Regulation 22 of the CHALR are sacrosanct. 9. Admittedly, the SCN under the CHALR/CBLR i....
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.... go as a follow up action. 11. Regulation 20(5) contemplates that the Commissioner shall furnish the copy of the report to the customs broker and shall require the customs broker to submit their reply within 30 days against the said report. Regulation 20(7) contemplates that the Commissioner shall after considering the report of the inquiry officer and the representation of the broker, pass such orders, as he deems it fit either revoking the suspension order or imposing penalty within 90 days from the date of submission of the report. As this Court has already found that the very filing of the report was beyond the period of 90 days as required under Regulation 20(5) and thus taken the view that the Commissioner of Customs is not entitled to proceed further under Regulations 20(6) and 20(7) as stated supra, the impugned show cause notice cannot have legs to stand any more, as naturally it has to fall on its own, in view of the lapse committed by the Officers as stated supra, as the inquiry report, pursuant to the issuance of the show cause notice, was admittedly filed beyond the prescribed period of limitation. 12. It is claimed by the Revenue that the petitioner is an habitu....
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....ation is having statutory force and that the 90 days prescribed under Regulation 22(1) is mandatory in nature and cannot be treated as directory. 19. Another Division Bench decision of this Court in an order made in CMA No. 730 of 2016, dated 13-10-2017, while answering the question whether or not the belated show cause notice issued beyond 90 days would be fatal to the entire proceedings, has observed that the limitation prescribed is mandatory and therefore, the mandatory requirement of the limitation cannot be ignored. In order to answer the said question, the Division Bench has elaborately considered various decisions rendered by various Courts and thereafter, has come to the above conclusion. 20. Likewise, the Delhi High Court in the decisions reported in 2016 (340) E.L.T. 119, Overseas Air Cargo v. CC and 2016 (337) E.L.T. 41, Indair Carrier Pvt. Ltd. v. Commissioner of Customs (General), has also taken the similar view. 21. In W.P. No. 27948 of 2017, it is contended by the Learned Counsel for the Revenue that the Enquiry Report dated 23-5-2018 was made within 88 days from the date of show cause notice. Therefore, it is contended that the time limit is adhered to. On....
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....reported in 2018 (362) E.L.T. 947, OTA FalloonsForwarders Pvt. Ltd. v. Union of India, is relied on, wherein the Learned Judge has observed that the time limit prescribed in the Regulations are not mandatory, since the consequence of non-adherence to the time limit has not been provided in the regulations. 25. A Division Bench decision of this Court made in W.P. (MD) No. 11986 of 2018, etc., dated 19-7-2018, (wherein I am one of the party to the Bench) is also heavily relied on by the respondents in support of their contention that the time limit prescribed is only directory by applying the consequence of non-compliance test. 26. Let me now consider the issue as to whether there is no consequence followed for not complying with the time limit prescribed under the present Regulations, as contended by the respondents. 27. No doubt, under the Regulations, it is not specifically stated as to what would follow as a consequence if each and every act contemplated under the Regulations is not done or completed within the prescribed time limit. In my considered view, merely because the Regulation does not prescribe or spell out expressly or specifically as to what would be the cons....