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Having Office At vs The Union Of India on 29 April, 2009

Bombay High Court
Having Office At vs The Union Of India on 29 April, 2009
Bench: F.I. Rebello, J. H. Bhatia
          IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                    CIVIL JURISDICTION

              WRIT PETITION NO.2700 OF 2009

    A.S.Vasan & Sons (Bombay)




                                                                  
    A Partnership Firm,
    Through its partner-
    Mrs.Bindu Unnikrishnan




                                          
    Having office at
    610, Arenja Corner, Sector-17,
    Vashi, Navi Mumbai-400 705               ....Petitioner.
    v.




                                         
    1.The Union of India
      Through Central Govt. Advocates,
      Dedicated Legal Cell,
      New Custom House,
      Ballard Estate,




                                 
      Mumbai 400 001.

    2. Chief Commissioner of Customs
                    
       Mumbai-I, New Custom House,
       Ballard Estate,
       Mumbai- 400 038
                   
    3. Commissioner of Customs (G)
       New Custom House,
       Ballard Estate,
       Mumbai 400 038

    4. Customs & Excise, Service Tax
      


       Appellate Tribunal
       Through Asstt. Registrar,
   



       3rd, 4th & 5th Floor, Jai Centre,
       34, P.D'Mello Road,
       Masjid (East), Mumbai           ...Respondents.





    Mr.Sujay N.    Katawala   with Mr.Brijesh Pathak              and
    Mr.U.P.Warunjikar advs.   for the Appellant.

    Mr.P.S.Jetly   with   Mr.R.Kumar     advs.          for       the
    Respondents.





                              CORAM : F.I. REBELLO &
                                      J.H.BHATIA,
                                      J.H.BHATIA JJ.
                              DATE : 29th April, 2009.


    JUDGMENT :

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1. Rule. By consent heard forthwith.

2. Petitioner was Licensed Customs House Agent

(CHA). The CHA Licence No.11/483 issued to the

petitioner expired on 31.12.2007. Petitioner applied

for renewal of the said licence within the time

prescribed. As the application for renewal was not

being decided, the petitioner filed Writ Petition

No.310 of 2008 which came to be disposed off by order

dated January 25, 2008 pursuant to statement made on

behalf of the

respondents that the

renewal application would be decided within two weeks.

petitioner’s

3. Petitioner earlier had made representations,

which were received in the office of the respondents

on 31.12.2007. In the representation dated 28.12.2007

after setting out various contentions, petitioner had

set out as under; “In case any further clarification

is essential, we may please be heard”. Subsequent to

the order passed by this Court in writ petition, the

respondent no.3 passed an order that the licence is

not to be renewed beyond 31.12.2007 and accordingly,

their application in this regard is rejected.

4. Petitioner aggrieved by that order, preferred an

appeal before the Chief Commissioner of Customs. That

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came to be disposed off by communication dated

19.8.2008 whereby the petitioners were informed that

there is no statutory provision under the Customs

House Agents Licensing Regulations, 2004 (Hereinafter

referred to as ‘Regulations’) for filing an appeal.

Petitioner was informed that accordingly, the matter

was referred to the Competent Authority, i.e.,

Commissioner of Customs (G). Petitioner had also

preferred an appeal before the Tribunal (CESTAT). The

Tribunal by its order held that the order passed by

the Commissioner rejecting renewal of licence is

administrative

order
in
ignature and not a

against which an appeal is maintainable
quasi judicial

before

the Tribunal and accordingly, dismissed the appeal.

Petitioners have thereafter come before this Court by

way of writ petition impugning the order of the

Commissioner.

5. In the first instance, it is submitted on behalf

of the petitioners by the learned counsel that under

the Regulations, an appeal would be maintainable

before the Chief Commissioner of Customs or in

alternative, an appeal considering the provisions of

Regulation 22(8) could be filed before the CESTAT. It

is submitted that the application for renewal for all

purposes is a fresh application and accordingly, an

appeal would lie. Reliance was placed on the judgment

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of the Supreme Court in Falcon Air Cargo and Travels

(P) Ltd. v. Union of India 2002(140) E.L.T. 8

(Del.).

(Del.) Delhi High Court has noted that non-renewal

and revocations are conceptually and contextually

different. It held that “revocation” is the calling

back of a thing granted or destroying or making void

of some deed that had existence, and the act of

revocation made it void. Renewal of a licence means a

new licence granted by such act. Its effect is to

prevent discontinuance or forfeiture. Renewal comes

at a stage when the period of currency of the licence

and Others v.

is over and its validity is extended. In Gajraj Singh

State Transport Appellate Tribunal and

Others (1997) 1 Supreme Court Cases 650,
650 the Supreme

Court in the case under the Motor Vehicles Act has

been pleased to hold that the renewal of licence means

a new licence granted by way of renewal. It was,

therefore, sought to be contended that application for

renewal being a fresh application and considering

Regulation 9(4), an appeal would lie.

6. Let us, therefore, consider whether an appeal is

maintenable. Under Regulation 5, an application for a

licence to act as a Customs House Agent in a Customs

Station shall be made in Form A and shall, inter alia,

contain the name and the address of the person

applying and the other particulars as set out therein.

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Regulation 9 deals with grant of licence in Form B.

Regulation 9(3) reads as under;

“9(3) The Commissioner of Customs may reject an
application for the grant of licence to act as

Customs House Agent if the applicant is involved
in fraud or forgery, or any criminal proceedings
are pending before any court of law against him
or he has been convicted in any court of law.”

Regulation 9(4) is relevant. It reads as under:

“9(4) Any applicant aggrieved by the order of
the Commissioner of Customs passed under

sub-regulation (3) may appeal to the Chief
Commissioner of Customs or Chief Commissioner of
Customs and Central Excise, as the case may be,
within a period of thirty days from the

communication of such order.”

. Other relevant Regulation is Regulation 11 which

reads as under:

“11. Period of validity of a licence.-

                                         licence. (1)                 A
         licence granted under regulation 9 shall                    be
         valid for a period of ten years from the date               of





         issue and shall be renewed from time to time                in
         accordance   with the    procedure provided                 in
         sub-regulation (2).

         (2)   The Commissioner of     Customs may,    on

application made by the licensee before the

expiry of the validity of the licence under
sub-regulation (1), renew the licence for a
further period of ten years from the date of
expiration of the original licence granted under
regulation 9 or of the last renewal of such
licence, as the case may be, if the performance
of the licensee is found to be satisfactory with
reference, inter alia, to the following:-

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(a) quantity or value of cargo cleared by such
licensee conforming to norms as may be specified
by the Commissioner;

(b) absence of instances of any complaints of

misconduct including non-compliance of any of
the obligations specified in regulation 13.

(3) The fee for renewal of a licence
sub-regulation (2) shall be Rs.5,000/-.

7. If we read Regulation 9 with Regulation 11 and

even if an application for renewal is treated as a

fresh licence, the Regulations permitted appeal only

where an application is rejected under Regulation

9(3).

under Regulation

Regulation 11 does not so provide.

9, the Commissioner of Customs
Secondly,

may

reject an application for the grant of licence to act

as Customs House Agent if the applicant is involved in

fraud or forgery, or any criminal proceedings are

pending before any court of law against him or he has

been convicted in any court of law. These are,

therefore, the considerations for the grant of a new

licence based on the first application for CHA

licence.

8. On the other hand, so far as Regulation 11(2) is

concerned, it provides for renewal and while

considering renewal, what has to be considered is, if

the performance of the licensee is found to be

satisfactory in terms set out under Regulation 11(2).

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These are the requirements after the licence has been

granted. Application for grant of licence and for

revocation of that licence are distinct and different.

No appeal is provided under Section 11 whereas, an

appeal is provided under Regulation 9(4) in those

cases, where an application for licence is rejected

under regulation 9(3). We are, therefore, clearly of

the opinion that no appeal lies against the order of

the Commissioner rejecting an application for renewal.

It may be mentioned that in case of Customs House

Agent licence, our attention was invited to the

judgment

of Calcutta High Court in M.Dutta Agency

Commissioner of Customs 1998 (101) E.L.T. 581 (Cal.).

(Cal.)
v.

It was contended before Calcutta High Court that the

appeal would lie against the refusal to renew CHA

licence. Considering the language of Section

129A(1)(a) of Customs Act, 1962, the learned Judge

held that an appeal is provided against the suspension

or revocation but not for refusal to renew CHA

licence. We are clearly of the opinion that no appeal

lies against the order rejecting an application for

renewal. In absence of any other remedy it is open to

this Court to exercise its extraordinary jurisdiction

in case where an application for renewal is rejected.

9. Having so said, the next question before us is

whether the impugned order is liable to be set aside.

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Apart from various challenges made, the learned

counsel for the petitioners has submitted as under:

1. That the order was passed without giving an

opportunity to the petitioners. The order
visits petitioner with civil consequences.
Once, that is the case, the order is violative

of principles of natural justice and fair play
and the impugned order is liable to be set
aside;

2. It is further submitted that the learned

Commissioner while considering the application
for renewal placed reliance on the original
order passed against Mr.Unnikrishnan, who was
partner of the petitioner firm. Our attention
is invited to the order passed against

Unnikrishnan which was thereafter set aside by
the Tribunal and consequently, the order of the
learned Commissioner suffers from

non-application of mind. On this count also, it
is submitted that the order should be set aside.

. On the other hand, on behalf of the respondents,

the learned counsel submits that there is no statutory

right to be heard under the Regulation and in those

cases, where a party has to be heard in person, the

Regulations have so provided. It is, therefore,

submitted that the question of giving personal hearing

would not arise in the matter. It is further

submitted that the order passed against Unnikrishnan

was in respect of penal proceedings. Unnikrishnan was

a partner of the petitioner’s firm. Mere setting

aside of the order against Unnikrishnan would be of no

consequence as it was in penal proceedings whereas, in

the instant case, what is being considered was an

application for renewal.

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10. We have heard the learned counsel for the

Parties. In the first instance, there can be no

dispute that the order rejecting application has

visited the petitioner with civil consequences. In a

case where an order whether it be administrative or

quasi judicial, visits the party with civil

consequences in absence of any statutory exclusion

under the Regulations, there would be a right to a

hearing. The right to hearing would include right to

a person being heard in person if such a request is

made.

petitioner in

In the instant case, we may point out that the

representation dated 28.12.2007 had

sought for hearing in the circumstances set out

therein. Merely because the regulation expressly does

not provide for a hearing, would not mean that the

petitioner should not be given a hearing. This is all

more so considering that the respondent no.3 has

relied on the original order in the case of

Unnikrishnan, thus, denying the petitioner a fair

opportunity of explaining why the order in

Unnikrishnan ought not to be considered. In our

opinion, therefore, as no notice of hearing was given

to the petitioners by the respondent no.3, the

impugned order is liable to be set aside on that count

alone.

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11. Considering the arguments in the instant case,

we find that the Tribunal has relied on the order

passed against C.R.Unnikrishnan and has quoted

extensively from the said order. After quoting from

the said order, the learned Commissioner proceeded on

the footings that Unnikrishnan as a partner of the CHA

firm was involved in the export fraud. Admittedly, in

proceedings taken out by Unnikrishnan against the said

order, it was set aside. Once the Tribunal has

proceeded to rely upon an order which was set aside

that by itself would disclose non-application of mind

or relying

irrespective
on

of

irrelevant matrial.

the fact that whether the
This

order
is

in

Unnikrishnan was in respect of the penal proceedings

or not. Considering that irrelevant material was

considered, it would vitiate the order much as

considering extraneous material. On this count also,

therefore, the impugned order is liable to be set

aside.

12. On behalf of the petitioner, the learned counsel

sought to contend that considering paragraph 1 of the

order of the learned Commissioner and the very fact

that no hearing was given to them, the respondent no.3

ought not to hear the matter. In our opinion, there

is no material before us warranting an order to

transfer the proceedings from the respondent no.3 to

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any other authority. Merely because some observations

are passed cannot result in holding that authority is

biased and against the petitioner. We, therefore,

decline to transfer the proceeding.

13. We make it clear that the respondent no.3 before

proceeding to hear and dispose off the matter to give

an opportunity to the petitioner as they had sought

such an opportunity and be uninfluenced by what has

been stated in the earlier order. With the above

observations, present petition can be disposed off.

    14.     In     those
                            
                             circumstances,      petition        is      made
                           
    absolute     in    terms    of    prayer   clause    (a)(1).           The

    respondent      no.3     to dispose off the appeal not              later

    than 12 weeks from today.
      
   



    15.     Rule    made absolute accordingly.          No order as to

    costs.






         ( J.H.BHATIA, J.)                       ( F.I.REBELLO, J.)




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