Customs, Excise and Gold Tribunal - Tamil Nadu
Aurotrans Maritime Services (P) Ltd. vs Commr. Of Cus. on 5 January, 1999
Equivalent citations: 1999(65)ECC271, 1999(111)ELT130(TRI-CHENNAI)
ORDER V.K. Ashtana, Member (T)
1. This is an appeal against the Order-in-Original No. R-282/CHA, dated 28-7-1998 passed by the Commissioner of Customs, Chennai, wherein the learned Commissioner has cancelled the appellant's CHA licence to operate as a licenced CHA in the jurisdiction of Chennai Custom house. The only issue for consideration is whether the appellant's licence has been rightly cancelled, instead of renewing the same as per his renewal application under Regulation 12.
2. Heard learned Consultant Sri M.S. Kumaraswamy, who submitted as follows :-
(a) The appellants were granted temporary CHA licence by the Commissioner of Customs, Bangalore in the year 1988.
(b) The same was converted into a permanent licence bearing No. R-3/89, dated 31-5-1989 by the Commissioner of Customs, Bangalore under Regulation 10 of CHALR.
(c) In due course of time, the appellants business improved in Chennai also and therefore, he qualified and obtained a CHA licence under Regulation 10(2) on 3-7-1989 bearing No. R/282, issued by the Commissioner of Customs, Chennai and valid upto 16-1-1997.
(d) While the appellants operated both these licences at Bangalore and Chennai, their business decreased in Bangalore, but increased in Chennai and therefore, after the validity period of Bangalore licence, which was about to expire, he chose not to get it renewed, as it was their wish to pursue their business only in Chennai.
(e) When the validity period of the licence issued at Chennai was about to expire, the appellants moved an application to the learned Commissioner under Regulation 12 for its renewal and nothing was heard over a long period of time. The matter was further agitated later and resulted in the order dated 28th April, 1998. This order was considered by this Tribunal and the matter was remanded vide Final Order No. 796/98, dated 30-4-1998. In pursuance of the said remand order, the impugned Order-in-Original has been issued, wherein the learned Commissioner has held as follows :-
"It is true that the party had been operating as a full fledged CHA for the last 10 years but in view of the fact that the original licence issued under Rule 10(1) has been cancelled, obviously the licence issued based on 10(2) licence has to go. There is no provision under the rules to keep the 10(2) licence alive even after the 10(1) licence was cancelled. It may appear anachronistic to cancel a licence which was in operation for about 10 years only because the main licence issued in different station was cancelled. But the law as it stands does not permit any other interpretation.
Under these circumstances, I have no option but to cancel the licence. Accordingly, the said licence is cancelled."
3. The learned Consultant argues that the said cancellation is patently illegal, in view of the fact that both the licences at Bangalore and Chennai were issued under Regulation 10 of CHALR and therefore, both have to be treated as independent licences issued by independent competent authorities. The learned Consultant also submits that in case, a view has been taken that the licence at Chennai is to be viewed to be linked with the parent licence of Bangalore, it leads to an unsatisfactory position wherein the appellant is forced to do business in Bangalore, simply to enable him to do business in his preferred place i.e. at Chennai, this is an illogical supposition. The learned Consultant further submits that both the licences were issued in the format of Form D of the said regulations. He further submits that the licence which was issued by Chennai Customs do not have on the face of it any linkage with the licence issued at Bangalore. He submits that at the time, when the licence at Chennai was issued, the appellants qualified for the same, in view of the fact that they had licence at Bangalore. He further argued that nowhere in CHALR regulations it is laid down that once the qualification is recognised and independent licence is issued under Regulation 10(2) at the other Custom House, this linkage should be continued. He further submits that when their application for renewal under Regulation 12 was submitted to the learned Commissioner, the same should have been renewed in terms of Regulation 12 because none of the conditions prescribed under Regulation 12, which would lead to non-renewal, were attracted in their case. The learned Consultant further sub mits that there is no record of any mis-conduct noticed by either Bangalore Customs or Chennai Customs on record. He, therefore, submits that merely because the parent licence has been voluntarily allowed to lapse, the independent licence of Chennai should not have been cancelled.
4. Heard learned JDR Smt. Aruna Gupta. She emphasised that the moot point of law in this dispute has been summed up in para 9 of the Order-in-Original impugned. She submits that since the original licence under Regulation 10 was allowed to be lapsed, the appellants no longer remained qualified to hold the licence under Regulation 10(2) and therefore, the Commissioner has correctly cancelled their licence at Chennai in non-consideration of their renewal application noted above.
5. We have carefully considered the rival submissions as well as the records of the case. We find that Regulation 10 of the Custom House Agents Licensing Regulations, 1984 (CHALR) prescribes the conditions on which CHA licences may be granted to the applicants. We find that since the appellant, who was already in a possession of temporary licence had qualified in the examination at Bangalore Customs, he had been granted a regular licence under Regulation 10 ibid, on 31-5-1989 by the Commissioner of Customs, Bangalore. Having so obtained the licence, he also earned right under Regulation 10(2) to act as Custom House Agent in all Customs stations, subject to the fulfilment of the requirements delieniated under Regulation 10(2) ibid. The appellant has applied for such a licence to the Custom House, Chennai which, after due consideration of the fact that he has qualified all the requirements of the said Regulation 10(2), issued a regular licence under Regulation 10(2) bearing No.R 282 and was valid upto 16-1-1997. We further find that as this licence at Chennai was about to expire, the appellants in time submitted an application for its renewal under Regulation 12(1)(b). The rejection of renewal has led to the instant dispute.
6. We find that Regulation 10 concerns only the grant of regular licence. Regulation 10(3) does empower the Commissioner to reject such an application. However, in this case, it is nobody's case that such a rejection was done. On the contrary, the learned Commissioners at Bangalore as well as at Chennai, granted CHA regular licences on the basis of this regulation. A perusal of the said regulation shows that nowhere does this regulation empower the Commissioners either to renew or suspend or revoke the licence; instead such provisions are expressly provided elsewhere in the said regulations. We find that the licence under Regulation 10(2) was issued in the same format i.e. form D, as was done in the case of their Bangalore licence. We note that the licence issued at Chennai bore no condition that it was valid only for the period when the parent licence at Bangalore was valid. We observe that it was rightly so because grant of licence under Regulation 10(2) is not subject to any such express condition.
7. We, therefore, have of necessity to also consider Regulation 12, whereunder the appellants had made request for renewal of the said licence at Chennai. A plain reading of the said Regulation shows that any licence granted under Regulation 10 shall be valid for this specified period and may be renewed from time to time, in accordance with the procedure provided in Sub-regulation (2) thereof. A perusal of the Sub-regulation (2) further shows that when an application for renewal is received by the Commissioner before the expiry of the validity period, the Commissioner has to consider the said application, in accordance with the Conditions (a) and (b) provided in the said Sub-regulation (2), apart from the general performance of the licensee. We find that it is not anybody's case that general performance of this licence holder at Chennai was in any way disqualifying in this matter. We also find that it is not anybody's case that the Commissioner at Bangalore had cancelled their licence because of any such disqualification. On the contrary, that licence was voluntarily allowed to be lapsed by the licence-holder as he had no wish to transact any business in the city of Bangalore and further particularly as his business in Chennai had grown tremendously. We find that the two other reasons on which the renewal may be denied are that (a) the quantity or value of cargo cleared by such licensee does not conform to certain norms prescribed by the Commissioner and (b) that there are instances of delay in clearances of goods or any other mis-conduct as described therein. The records of the case do not show that the licence was not renewed on either of these two grounds. The only ground on which the licence was not renewed by the learned Commissioner was that the parent licence under Regulation 10 was no more alive at Bangalore. We do not find that Regulation 12 expressly lays down that when the parent licence is not alive, subsequent licences issued under Regulation 10(2) was also ceased to have validity.
8. Similarly, a licence can be suspended or revoked finally under Regulation 21. It is not anybody's case, in the present appeal, that this regulation was invoked by the Commissioner. It is also not on record that the licensee was involved in any mis-conduct pertaining to his genuine obligations, as a Custom House Agent.
9. When we take these facts into view, the holistic picture which emerges is that a licence at Chennai was granted by an independent competent authority also under Regulation 10, as was the licence granted at Bangalore. We also find that none of the regulations as discussed above, provided that there should be any linkage between the two. As discussed above, we also do not find any absence for such linkage for non-renewal of licence under Regulation 12. Once again, we cannot read into Regulation 12 what is not expressly provided therein. In view of this, we are of the considered opinion that once the licensee had obtained an independent licence under Regulation 10(2) at Chennai, he, in effect, was holding a licence which was independent allowing him to do business under CHALR both at Bangalore and Chennai. We cannot construe the provisions of CHALR in a manner in which we viewed that such a licensee is forced to do business at places other than his choice. This would be an insatisfactory position in law.
10. In view of this aforesaid analysis, we find that there is no room in law for any linkage between the licences issued under Regulation 10(2) at a place 'X' and the so called parent licence issued under the same regulations at place "Y". Once the second independent licence is issued under Regulation 10(2), then it can only be renewed or revoked or suspended under the provisions of Regulations 12 and 21 ibid., as Regulation 10 does not grant any such power. We have also noted that Regulation 12 also does not give any such linkage for non-renewal.
11. Therefore, taking all these facts into consideration, the order impugned deserves to be set aside with consequential relief to the appellants. We order accordingly and direct that the Commissioner of Customs at Chennai Custom House shall immediately renew the said licence of the appellants under Sub-regulation 12, as applied for. This renewal shall be deemed to be coming in effect from the date of expiry of the said licence valid i.e. 16-1-1997.
12. The appeal is allowed with consequential relief accordingly.