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IN THE HIGH COURT OF CALCUTTA
Arijit Banerjee, J.
Nepa Agency Co. Pvt. Ltd. & Anr - Petitioners
Versus
Union of India & Ors. - Respondents
W.P. No. 205 of 2015
Decided On : 13-05-2015
CUSTOMS BROKERS LICENSING REGULATIONS, 2013 - Suspension of License - CBLR 2013, Regs. 19, 20, 21 - Customs Act, 1962, S. 129A - The Calcutta High Court held that the Customs Brokers Licensing Regulations, 2013 (CBLR 2013) provide for an efficacious alternative remedy for challenging orders passed by the Commissioner of Customs, and therefore, the High Court should not exercise its extraordinary power under Article 226 of the Constitution of India to entertain a writ petition against such orders.
Fact of the Case:
The petitioner, a Customs House Agent, had its license suspended by the Commissioner of Customs for alleged involvement in a cigarette smuggling case. The petitioner challenged the suspension order, alleging violation of principles of natural justice and non-compliance with the 90-day time limit specified in Regulation 20 of the CBLR 2013 for issuing a show-cause notice.
Finding of the Court:
The court found that the principles of natural justice were not violated as the petitioner was given an opportunity to be heard and to contradict the statements recorded under Section 108 of the Customs Act, 1962. The court also held that the period of 90 days mentioned in Regulation 20 of the CBLR 2013 is directory and not mandatory, and therefore, issuance of a show-cause notice beyond the 90-day period does not render the proceedings bad.
Issues: 1. Whether the principles of natural justice were violated in the suspension of the petitioner's license. 2. Whether the issuance of the show-cause notice beyond the 90-day period specified in Regulation 20 of the CBLR 2013 rendered the proceedings bad. 3. Whether the existence of an efficacious alternative remedy barred the High Court from exercising its jurisdiction under Article 226 of the Constitution of India.
Ratio Decidendi: 1. The principles of natural justice do not require that the persons who have given information to the customs authorities should be examined in the presence of the appellant or should be allowed to be cross-examined by them on the statements made before the customs authorities. 2. The period of 90 days mentioned in Regulation 20 of the CBLR 2013 is directory and not mandatory, and therefore, issuance of a show-cause notice beyond the 90-day period does not render the proceedings bad. 3. Where a statute provides for a complete machinery to challenge an order of assessment, the impugned orders of assessment can only be challenged by the mode prescribed by the Act and not by a petition under Article 226 of the Constitution. 4. The Customs Act, 1962 and the rules and bye-laws framed thereunder constitute a comprehensive and exhaustive code, and the appeal provided for under Regulation 21 of the CBLR 2013 is an efficacious alternative remedy available to an aggrieved broker.
Final Decision: The writ petition was dismissed, and the petitioner was directed to approach the Customs, Central Excise, and Service Tax Appellate Tribunal by filing an appeal within six weeks from the date of the order.
Arijit Banerjee, J.
The petitioner no. 1 is a Customs House Agent carrying on business as clearing and forwarding agent. Under the Customs Broker Licensing Regulations, 2013, the Customs House Agents have been re-named as Customs Brokers. The petitioner holds Customs House Agent license issued by the Commissioner of Customs (Administration), Customs House, Calcutta.
2. It is the case of the respondents that in July, 2013 the Directorate of Revenue Intelligence, Calcutta Zonal Unit informed the respondents that their office had seized a case wherein cigarettes were attempted to be smuggled into India by way of concealment inside a container declared to be containing dining sets through the Calcutta Port. 610 cartons of cigarettes of Indonesian origin having estimated value of Rs. 4.35 crores were found concealed behind 80 dining sets. The declared importer and Customs House Agent were M/s. A.K. International, Moradabad, Uttar Pradesh and the writ petitioner no. 1 herein respectively. During preliminary investigation it was found that the declared Customs House Agent namely the petitioner no. 1 did not actually act as the agent but allowed some unauthorised persons to use its licence and name for clearance of the subject consignment.
3. By an order dated 25th July, 2013 the Commissioner of Customs (Airport and Administration), Calcutta observed that an enquiry is contemplated against the petitioner no. 1 under regulation 20 of Customs Brokers Licensing Regulations, 2013 and that pending completion of such enquiry, continuance of business transaction by the petitioner no. 1 is considered prejudicial to the interest of revenue warranting immediate action under regulation 19 (1) of the said Regulations to prevent further misuse of the customs brokers licence. With those observations, the Commissioner of Customs suspended the operation of the customs brokers license held by the petitioner no. 1 with immediate effect.
4. Inquiry was conducted against the petitioner-company and the suspension of license was confirmed by an order dated 11th September, 2013.
5. Being aggrieved, the petitioner-company challenged the order of suspension of licence by filing WP No. 153 of 2014 in this Court. Before this Court it was urged by the petitioner-company that there was a breach of the principles of natural justice. Copies of the statements recorded under Section 108 of the Customs Act, 1962 were not furnished to the petitioner-company and no opportunity was given to deal with such statements by cross-examination or otherwise.
6. This court by its order dated 4th August, 2014 directed the Commissioner of Customs to review the suspension order by giving an opportunity to the petitioner-company to be heard and to contradict the Section 108 statements.
7. Pursuant to the said order of this court the Commissioner of Customs (Airport and Administration) reviewed the earlier suspension order by giving an opportunity to the petitioner-company to be heard and to contradict the statements under Section 108 of the Customs Act. By an order dated 25th November, 2014 the Commissioner of Customs confirmed the earlier order suspending the licence of the petitioner-company in terms of the Regulation 19 (2) of the Customs Brokers Licensing Regulations, 2013 and also confirming the proceedings already initiated for revoking the license of the petitioner-company under regulation 20 of the 2013 regulations. It is this order of the Commissioner of Customs which is under challenge in the present writ petition.
8. Appearing on behalf of the writ petitioners, Mr. Chowdhury, Ld. Advocate has urged primarily three points. Firstly, he urged that the statements of one Manoj Baid were relied upon by the department but Mr. Baid was not offered for cross-examination by the representative of the petitioner-company. This was a blatant violation of principles of natural justice. Secondly, he submitted that no opportunity was given to the petitioner company to make submission on
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