IMPORTANT POINT
The period for issuing notice under Regulation 17(1) of the Customs Brokers Licensing Regulations is directory, and customs brokers must verify exporter identities.

JUDGMENT :

1. The appellant, a Customs Broker and a holder of regular licence issued under Regulation 9(1) of the Custom House Agent Licensing Regulations, 2004 has come up with the present appeal challenging the order passed by the Customs, Excise & Service Tax Appellate Tribunal, by which the order revoking the license is set aside, however the forfeiture of security deposit and imposition of penalty is upheld.

2. Succinctly, the facts in brief are as follows:

The appellant is a licensed Customs broker. On 22.3.2022 on a specific intelligence gathered by the Directorate of Revenue Intelligence (DRI), Zonal Unit, Cochin, a consignment of oil tanks stacked in the examination shed of Q10 CFS was found to have concealed wooden logs that appeared to be red sanders wrapped in hay. The total quantity of the red sander logs recovered was 2150 KGs. The export of red sanders is prohibited under the law. Thus, a restraint order was issued on 22.3.2022 by the Senior Intelligence Officer of DRI in respect of the seized wooden logs. An explanation was sought for from the appellant. The Managing Partner of the appellant gave the statement which was recorded on 23.3.2022, wherein, inter alia, it was submitted that one Sri. Shaan Basha had called upon the appellant for a quote for export of oil tanks to Colombo and the quote was given by them over phone. It was further stated that Sri. Shaan Basha informed that M/s. Zain Trading will be the exporter and also forwarded the photographs of the oil tanks intended to be exported. Copies of the IEC, GST, Pan Card, Aadhar, invoice, packing list etc. were forwarded by the said person through Whatsapp. It was further stated that the firm had not verified the identity of the exporter or the functioning of the exporter at the declared address and also never contacted the exporter. Pointing out that the Customs Broker has contravened the provisions of Regulation 10(d) of the Customs Brokers Licensing Regulations, 2018, the Commissioner of Customs proceeded to suspend the licence by order dated 25.3.2022. On 31.3.2022, the appellant requested for withdrawal of the suspension order. On 12.4.2022, the Commissioner of Customs in exercise of its powers conferred under Regulation 16 of the Customs Brokers Licensing Regulations, 2018, confirmed the order.

3. The appellant approached this Court in WP (C) No. 14202/2022 and by judgment dated 20.6.2022, a learned Single Judge of this Court set aside the order and directed the authorities to reconsider the issue. Pertinently, this Court ordered the suspension to continue till a fresh decision is taken by the respondent as directed by this Court. In pursuance to the directions contained in the Judgment dated 20.6.2022 in WP (C) No. 14202/2022, the Commissioner of Customs proceeded to pass order dated 1.7.2022, by which the decision to suspend the licence under Regulation 16(1) of the Customs Brokers Licensing Regulations, 2018, was affirmed. The said order was again questioned before this Court in WP (C) No. 22501/2022. A learned Single Judge of this Court issued an interim order dated 29.8.2022 staying the operation of order dated 1.7.2022. It was, however, made clear that the order will not prohibit continuation/culmination of proceedings initiated against the appellant.

4. While so, on 13.9.2022 a show cause notice was issued in exercise of the power conferred under Regulation 17 of the Customs Brokers Licensing Regulations, 2018, requiring the appellant to show cause as to why the licence shall not be revoked permanently. Along with the notice to show cause, a report dated 23.3.2022 from the Superintendent of Customs and also an offence report dated 1.9.2022 by the Assistant Commissioner of Customs were enclosed and the explanation of the appellant was solicited. In the light of the aforesaid show cause notice, WP (C) No. 22501/2022 was disposed of by this Court with a direction to the authorities to complete the proceedings within a period of three months and till