Custom, Excise & Service Tax Tribunal
M/S. K.S. Kannan & Coo vs Commissioner Of Customs, Chennai on 27 January, 2008
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No. C/392/2007
(Arising out of Order No. 6775/2007 dated 17.10.2007 passed by the Commissioner of Customs (Port Import), Chennai)
For approval and signature:
Honble Mr. P. G. Chacko, Member (Judicial)
Honble Mr. P. Karthikeyan, Member (Technical)
1. Whether Press Reporters may be allowed to see the Order for Publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether the Members wish to see the fair copy of the Order?
4. Whether Order is to be circulated to the Departmental authorities?
M/s. K.S. Kannan & Coo. Appellants
Vs.
Commissioner of Customs, Chennai Respondent
Appearance Shri B. Satish Sundar, Advocate and Shri S. Krishnanand, Consultant for the Appellants Shri M.K.A.K. Mohideen, JDR, for the Respondent CORAM Honble Mr. P. G. Chacko, Member (J) Honble Mr. P. Karthikeyan, Member (T) Date of Hearing: 27.01.2008 Date of Decision: 27.01.2008 Final Order No. ____________ Per P. G. CHACKO This appeal is by a Customs House Agent [CHA] whose licence was suspended by the Commissioner of Customs (Imports) under Regulation 20(2) of the Customs House Agents Licensing Regulations, 2004. After examining the records and hearing both sides, we note that the incident which has given rise to the impugned proceedings had occurred as early as on 13.1.2007. On that date, a Shipping Bill was filed in the name of M/s. Sekar & Sekar Process, Sivakasi for export of calcite powder. The stuffing of the export goods was done at Sivakasi in the presence of Central Excise officers and the cargo was transported to Chennai Port. Annexure A Declarations filed at the port was in the name of M/s. K.S. Kannan & Co. [CHA]. The appellants namely M/s. K.S. Kannan & Coo., upon being interrogated by the DRI, disowned the export documents and stated that they had not filed the Shipping Bill or other documents. The DRI inquiry was necessitated by earlier findings of examination of the goods which revealed that red sanders were attempted to be smuggled out of the country in the pretext of export of calcite powder. The statement of M/s. K.S. Kannan & Coo. was taken on 20.1.2007. Their licence was suspended by the Commissioner by the impugned order dated 17.10.2007.
2. It is submitted by the counsel for the appellants that the suspension of CHA licence without enquiry or show-cause notice after more than nine months from the date of the relevant incident cannot be sustained in law. In this connection, learned counsel has relied on the following decisions:-
(i) Ganesh Shipping Agency Vs. Commissioner of Customs, Chennai 2008 (222) ELT 536 (Tri. Chennai)
(ii) P.C. India Shipping Agency Vs. Commissioner of Customs (General), Mumbai I 2007 (213) ELT 251 (Tri. Mumbai)
(iii) P.V. Ramana Murthy Son Vs. Commissioner of Customs, Cochin 2006 (205) ELT 861 (Tri. Bang.)
(iv) International Cargo Services Vs. Union of India 2006 (193) ELT 546 (Del.)
(v) Kunal Travels (Cargo) Vs. Commissioner of Customs, New Delhi 2005 (180) ELT 345 (Tri. Del.)
(vi) Kamal Kumar Agarwal Vs. Union of India 2004 (171) ELT 301 (Cal.) It was also submitted that the export consignment was handled by M/s. K.S. Kannan & Co. and not by M/s. K.S.Kannan & Coo. and therefore the appellants cannot be proceeded against on the basis of the incidence in question. We have heard learned JDR also, who has reiterated the findings and observations of the Commissioner.
3. Judicial authorities placed before us are unanimous on the point that immediate suspension of a CHA licence could be ordered only in cases where such action is necessary and where any enquiry against the CHA is pending or contemplated. In the instant case the licence was suspended after more than nine months since the incident in question [attempted smuggling of red sanders in the guise of export of calcite powder]. No enquiry whatsoever was conducted by or on behalf of the Commissioner so as to be able to make out a ground for immediate suspension of the operation of the licence. Under Regulation 20(2) of the CHALR, it was incumbent upon the Commissioner to gather enough information justifying immediate action against the CHA. He should have obtained enough materials warranting urgent action against the CHA. He could have suspended the operation of the licence only where an enquiry against the CHA was pending or contemplated. In the present case, no enquiry was pending when the impugned order was passed inasmuch as no show-cause notice had been issued against them. The circumstances did not even indicate that any enquiry was contemplated against the CHA. The long gap of nine months between the relevant incident and the suspension of licence is per se indicative of the haphazardness on the part of the Commissioner in proceeding against the CHA. On these facts, we have got to set aside the Commissioners order and it is ordered accordingly. The appeal stands allowed. It is however made clear that nothing stands in the way of the Commissioner proceeding against the CHA in accordance with Regulation 20(1) of the CHALR, if enough materials are available for the same.
(Dictated and pronounced in open court)
(P. KARTHIKEYAN) (P.G. CHACKO)
Member (T) Member (J)
Rex
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