Delhi High Court
Rajinder Kumar Goyal vs Collector Of Customs on 6 April, 1995
Equivalent citations: 1995(79)ELT54(DEL)
Author: D.P. Wadhwa
Bench: D.P. Wadhwa
ORDER D.P. Wadhwa, J.
1. In this petition under Article 226 of the Constitution the petitioner is challenging the order No. VIII (H) 13/144/89, dated 7 January 1994 of the Collector of Customs, New Delhi, suspending his Custom House Agent (CHA) license No. R-14/91 with immediate effect till further orders. This order we reproduce as under :
"REGISTERED POST OFFICE OF THE COLLECTOR OF CUSTOM :
CUSTOMS HOUSE : NEW DELHI.
O. No. VIII (H) 13/144/89 Dated : 7-1-1994
ORDER
Mr. Rajinder Kumar Goyal, SM-18, Ashok Deep Building, 4/24, East Patel Nagar, New Delhi, is holder of Custom House Agent license No. R-14/91 valid up to 12-2-1994 issued by Collector of Customs, New Delhi, for customs clearance work at Delhi Custom/station under the charge.
An enquiry is contemplated against the said Custom House Agent under Custom House Agent Licensing Regulation, 1984 in relation to the under-invoicing of consignments of Bill of Entry No. 240586, dated 10-8-1992, 241621, dated 14-8-1992, 242790, dated 22-8-1992, 244986, dated 2-9-1992 and 245492, dated 4-7-1992 imported at Air Cargo Unit at IGI Airport by one Shri Moti Lal Chandra a trader of Bhagirath Place, Delhi, by misusing the name and import-export code number of an actual user M/s. Trishul Industries, C-19, Sector-59, Noida and M-41, Greater Kailash-II, New Delhi, and that M/s. Rajinder Kumar Goyal, the Custom House Agent, assisted in clearance of the same.
Now, therefore, on the basis of records placed before me and being satisfied, I ANAND BORDIA, Collector of Custom, New Delhi, in exercise of power vested in me under Regulation 21(2) ibid, hereby order the suspension of CHA license No. R-14\91 of the said CHA with immediate effect till further orders.
This orders is being issued without prejudice to any other action being taken or proposed to be taken against the said CHA/ its employees or any other person/representatives under the Customs Act, 1962 or any other law for the time being in force.
Sd/ Collector of Customs M/s. Rajinder Kumar Goyal, SM-18, Ashok Deep Building, 4/24, East Patel Nagar/ New Delhi."
2. The petitioner says that the impugned order is without jurisdiction and is in contravention of the provisions of the regulation 21(2) of the Custom House Agents Licensing Regulations, 1984 (for short 'the Regulations'). He says he waited for over a year after suspension of the license for the responded to conclude any enquiry against him and to restore his license. He represented to the respondent but without effect. Petitioner says it is the question of his livelihood and the action of the respondent is violative of Article 21 of the Constitution.
3. We issued notice to show cause to the respondent. In answer thereto an affidavit has been filed by Mr. Vijay Kumar Takkar, Assistant Collector of Customs. It is stated that the license of the petitioner was valid up to 12 February 1994 and that the license could be further renewed only on an application made as per the provisions of the Regulation 12 of the Regulations. Then it is stated as under :
"2. A case of gross under valuation of imported goods and forgery was notice by the Special Intelligence & Investigation Branch (henceforth to be called SIIB) of Delhi Custom Collectorate against M/s. Trishul Industries, C-19, Sector-57, NOIDA (the importers) with reference to goods imported and cleared under Bills of Entry Nos. 240586, dated 10-8-1992, 241621, dated 14-8-1992, 242790, dated 22-8-1992., 244986, dated 2-9-1992 and 245492, dated 4-7-1992. Since the petitioner was clearing agent for clearing these consignments on behalf of the importers, the petitioner was asked to present the importers or to inform the Department about their whereabouts as required under Regulation 14(a) of the CHALR, 1984. On further investigation of the case by SIIB, it was found that the signatures purported to be of the importer on the said Bills of Entry were forged. In addition, these consignments are suspected to be grossly under-invoiced. It appears to be a case of evasion of duty to the extent of Rs. 50 lakhs or more out of which Rs. 3.50 lakhs have been paid by the "petitioner".
3. Due to the above-mentioned offence suspected involvement on the part of the petitioners, the CHA license No. 14/91 was suspended vide order No. VIII (H) 13/144/89, dated 7-1-1994 by the Collector of Customs, Delhi, under powers vested with him under Regulation 21(2) of the CHALR, 1984."
4. Lastly it is stated that the petitioner did not exhaust the alternative remedy of filing an appeal as provided under Regulation 23(8) of the Regulations read with Section 129A of the Customs Act, 1962. It is also stated that investigations are on and after their conclusion a show cause notice would be issued to the petitioner and he would be entitled to represent his case before the authority concerned and on that account it is stated the present petition is premature.
5. The affidavit is silent as to the progress made in the investigation and the stage thereof. We required the relevant files of the department to be produced and their examination shows that there has not been any serious attempt to investigate the matter. It was submitted that the registered letters addressed to Moti Lal Chandra on behalf of M/s. Trishul Industries, Noida, were received back unserved. That would appear to be the end of the investigation. However, in the present proceedings we do not think we are concerned with the extent of the investigations. The fact remains that the illegality or irregularity came to the notice of the department in July 1992 and it was on 7 January, 1994 that the license of the petitioner was suspended.
6. Central Board of Excise and Customs constituted under Central Board of Revenue Act, 1963, has framed the Regulations under Section 146 of the Customs Act, 1962. This section is as under :-
"146. Customs house agents to be licensed. - (1) No person shall carry on business as an agent relating to the entry or departure of a conveyance or the import or export of goods at any customs station unless such person holds a license granted in this behalf in accordance with the regulations.
(2) The Board may make regulations for the purpose of carrying out the provisions of this section and, on particular, such regulations may provide for -
(a) the authority by which a license may be granted under this section and the period of validity of any such license;
(b) the form of the license and the fees payable therefore;
(c) the qualifications of persons who may apply for a license and the qualifications of persons to be employed by a licensee to assist him in his work as an agent;
(d) the restrictions and conditions (including the furnishing of security by the licensee) subject to which a license may be granted;
(e) the circumstances in which a license may be suspended or revoked;
(f) the appeals, if any, against an order of suspension or revocation of a license and the period within which such apples shall be filed."
7. Regulation 21 of the Regulations provides for suspension or revocation of license and Regulation 23 prescribes procedure for suspending or revoking license under Regulation 21. We may reproduce Regulations 21 and 23 as under :-
"21. Suspension or revocation of license. - (1) Collector may, subject to the provisions of Regulation 23, suspend or revoke the license of a Custom House Agent so far as the jurisdiction of the Collector is concerned and also order for forfeiture of security on any of the following grounds :-
(a) failure of the Custom House Agent to comply with any of the conditions of the bond executed by him under Regulation 11;
(b) failure of the Custom House Agent to comply with any of the provisions of these regulations, whether within the jurisdiction of the said Collector or anywhere else;
(c) any misconduct on his part whether within the jurisdiction of the said Collector or anywhere else which in the opinion of the Collector renders him unfit to transact any business in the Customs Station.
(2) Notwithstanding anything contained in sub-regulation (1), the Collector may, in appropriate cases, where immediate action is necessary, suspend the license of a Custom House Agent where an enquiry against such agent is pending or contemplated."
"23. Procedure for suspending or revoking license under Regulation 21. - (1) The Collector shall issue a notice in writing to the Customs House Agent stating the grounds on which it is proposed to suspend or revoke the license and requiring the said a gent to submit within such time as may be specified in the notice not being less than forty-five days, to the Assistant Collector of Customs nominated by him, a written statement of defense and also to specify in the said statement whether the Custom House Agent desires to be heard in person by the said Assistant Collector of Customs.
(2) On receipt of the written statement from the Custom House Agent, or where no such statement has been received within the time limit specified in the notice referred to in sub-regulation (1), the Assistant Collector of Customs may inquire into such of the ground as are not admitted.
(3) The Assistant Collector of Customs 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 Custom House Agent, for the purpose of ascertaining the correct position.
(4) The Custom House Agent shall be entitled to cross-examine the persons examined in support of the grounds forming the basis of the proceedings and where the Assistant Collector of Customs declines to examine any person on the grounds that his evidence is not relevant or material, he shall record his reasons in writing for so doing.
(5) At the conclusion of the aforesaid inquiry, the Assistant Collector of Customs shall prepare a report of the inquiry recording his findings.
(6) The Collector of Customs shall furnish to the Custom House Agent a copy of the report of the Assistant Collector of Customs and shall require the Custom house Agent to submit within the specified period not being less than sixty days any representation that he may wish to make against the findings of the Assistant Collector of Customs.
(7) The Collector shall, after considering the report of the inquiry, and the representation thereon, if any, made by the Custom House Agent, pass such orders a he deems fit.
(8) Any Customs House Agent aggrieved by any decision or order passed under Regulation 21 or sub-regulation (7) of Regulation 23, may appeal under Section 129A of the Customs Act, 1962, to the Customs, Central Excise [and] Gold (Control) Appellate Tribunal established under Section 129(1) of Customs Act, 1962."
8. It was admitted that procedure as prescribed under Regulation 23 was not valid as provided in sub-regulation (1) of Regulation 21. Ms. Bhatia, learned counsel for the respondent, submitted that action had been taken under sub-regulation (2) of Regulation 21. But then the impugned order does not show that there was any necessity for the Collector of Customs to take immediate action suspending the license of the petitioner. The record produced before us also does not show that it was ever considered that it was a case where immediate action was necessary to suspend the license of the petitioner. Rather it took about 1-1/2 years for the Collector to take action purportedly under sub-regulation (2) of Regulation 21. Even today we have not been told as to what necessity had arisen after 1-1/2 years of the alleged illegality having been found to suspend the license of the petitioner. In normal circumstances license could be suspended only after resort to Regulation 23. This not having been done, the petitioner is rightly aggrieved. There is, thus, inherent lack of jurisdiction in proceeding under Regulation 21(2). Since the order itself is without jurisdiction this petition would be maintainable. It is not clear as to when the investigation would be complete, when show cause notice issued and adjudication completed and order passed. There appears to be no time limit for that. But then everything has to be done with utmost expedition and any unexplained delay will make the order void. Again that may not be relevant for our purpose as we find provisions of sub-regulation (2) of Regulation 21 have been violated. The petition is, therefore, allowed with costs. Order dated 7 January, 1994 suspending the Custom House Agent license of the petitioner is set aside. Counsel fee Rs. 1,000/-. We, however, make it clear that this order will not bar the authorities from taking action against the petitioner after following procedure under Regulation 23 of the Regulations.