ORDER
V.K. Agrawal, Member (T)
1. This appeal has been filed by M/s. Kunal Travels (Cargo), against order dated 20-9-2004 by which the Commissioner of Customs has suspended their Customs House Agent License under Regulation 20 (2) of the Custom House Agent Licensing Regulations, 2004.
2. Shri Bipin Garg, learned Advocate, submitted that the license has been suspended only with the observation that the enquiry is contemplated against them in relation to their involvement in a drawback fraud case wherein they have failed to discharge the obligation entrusted upon them by the Licensing Regulations; that the Commissioner has not specified as to which obligation they failed to discharge; that no details of the drawback case have been mentioned in the impugned Order in absence of which the appellants are not in a position to represent their case also. He further, mentioned that the appellants have made an enquiry from the Customs Department about the reasons for suspending the license; that they came to know that the license has been suspended on account of his two shipping bills dated 17-6-2003 against which a case was booked on the ground of over invoicing and shortage of quantity; that if the shipping bills involved are of 2003, there was no immediate action required to suspend the license; that as per the Regulation 20 (2), the Commissioner may in an appropriate case where immediate action is necessary, suspend the licence of CHA where an enquiry is pending against him; that in absence of any details, furnished in the suspension Order, it is non-speaking and illegal. He relied upon the decision in the case of D.H. Patkar & Co. v. C.C. (G), Mumbai, 1999 (111) E.L.T. 631 (T) wherein it has been held that power of suspension is to be exercised only if immediate action is called for and serious consequences are likely to follow in case licence is not suspended. Reliance has also been placed on the decision in the case of Kothari & Sons v. C.C., Jaipur, 2000 (122) E.L.T. 828 (T) wherein it has been held that the order of suspension must indicate that the Commissioner has formed an opinion that immediate action was necessary to suspend the CHA licence pending enquiry; that the Tribunal has set aside the suspension as the impugned Order neither disclosed nor did it mention the matter in respect of which an enquiry is pending or contemplated. Reliance has also been placed on the decision in the case of M.D. Sadrani v. C.C. (General), Mumbai, 2004 (167) E.L.T. 84 (T) wherein it has been held by the Tribtmal that continued suspension of the licence without hearing the appellants cannot be justified.
3. Countering the arguments, Sh. S. M. Tata, learned SDR, submitted that the impugned Order clearly mentions that an enquiry is contemplated against the appellants under Customs House Agents Licensing Regulations, 2004 in relation to their involvement in a drawback fraud case wherein they failed to discharge the obligations under the CHA Regulations; that as the matter is being investigated, the details have not been mentioned in the order, which is valid under the provisions of Regulations.
4. We have considered the submissions of both the sides. The provisions of Regulations 20(2) of the CHA Regulations, 2004, empowers the Commissioner to suspend the license of the CHA. As per sub-regulation (2), the Commissioner is empowered to suspend the license only when – (i) immediate action is necessary; and (ii) where an enquiry against such agent is pending or contemplated. Regulation 20(2) contains the procedure for suspending license under Regulation 20. According to the procedure, prescribed therein, the Commissioner shall issue a notice in writing to the CHA stating the grounds on which it is proposed to suspend the licence and enquirying the CHA to submit within the specified time period a written statement of defence. We find that no such notice, which is prescribed in Regulations 20 (2) has been issued to the appellants before suspending their licence. We also find substance in the submissions of the learned Advocate; that no details of the matter, in which the enquiry is contemplated against the appellants are mentioned in the impugned Order. We also observe that the impugned Order does not indicate as to how the Commissioner has formed an opinion that immediate action was necessary to suspend CHA License pending enquiry. The Appellate Tribunal in the case of Kothari & Sons (supra) after relying upon the decisions of Madras High Court in the case of East West Freight Carrier P. Ltd. v. Collector, 1995 (77) E.L.T. 79 (Mad.) and the Calcutta High Court decision in the case of N.C. Singha & Sons v. Union of India, 1998 (104) E.L.T. 11 (Cal.) has held that the Order, therein, was not in accordance with the provisions of Regulation and accordingly set aside the same. Following the said decisions, we hold that the impugned suspension Order has not been passed in accordance with the provisions of sub-regulation (2) of Regulations 20 of the Customs House Agents Regulations, 2004. We, therefore, set aside the said Order. We, however, give the liberty to the Commissioner to pass any fresh order, if required, after following the provisions in accordance with law. The appeal is disposed of in the above terms.