The Calcutta High Court has ruled that the filing of an enquiry report within 90 days under Customs Regulation 20(5) of Customs Broker Licensing and Regulation (CBLR), 2013 was directory, not mandatory.
The respondent herein as Customs Broker had filed a bill of export on January 2, 2014 for clearance with the customs authorities. The customs authorities had found that the respondent herein, as Customs Broker, to be in connivance with the exporter by aiding and abetting illegal exportation of contraceptives. The bill of export that had been submitted by the respondent as the Customs Broker was in relation to export of specified contraceptives banned by the Government of India for export as such contraceptives were meant for sale within India at a subsidised rate with the subsidy being provided by the Government of India.
With regard to such bill of export an offense report in the form of an Order in Original dated May 15, 2015 had been received by the appellant from the Commissioner of Customs (Preventive), Kolkata. By an order dated June 19, 2015 the customs authorities had suspended the operation of the Customs House Agent (CHA) License of the respondent, with immediate effect under Regulation 19 of Customs Brokers Licensing Regulations, 2013. A post decisional hearing had been granted to the respondent under Regulation 19 (2) of the Regulations of 2013 on June 22, 2015. Suspension of the respondent had been confirmed on June 24, 2015.
A Show Cause Notice under Regulation 20 (1) of the Regulations of 2013 had been issued to the respondent on July 31, 2015. The respondent had filed a writ petition being WP No. 1076 of 2015 challenging the Order in Original dated May 15, 2015 as well as the Show Cause Notice dated July 31, 2015.
Customs authorities had completed the enquiry under Regulation 20 (5) of the Regulations of 2013 on December 17, 2015 and the enquiry report was supplied to the respondent by a letter dated December 21, 2015.
Mr. K. K Maiti, representing the appellant has referred to a list of dates of the events happening in the matter leading up to the impugned order of the tribunal. He has contended that the Division Bench was unanimous with regard to the provisions of the Regulations of 2013 being directory in nature. He has contended that, the reference should be disposed of by holding that the time period specified in completing the enquiry and submitting the enquiry report are directory in nature.
The issue that has fallen for consideration in this reference is whether, the Tribunal could have discarded the enquiry report in its entirety as being submitted in breach of 8 the timeline prescribed in Regulation 20 (5) of the Regulations of 2013 or should have considered the same on merits and on such consideration have the discretion to attach such weightage to it as deemed appropriate.
In view of the division bench having unanimously held that, the timeline under Regulation 20 (5) of the Regulations of 2013 was directory in nature, the same was binding not only on this Court but also on all tribunals and authorities functioning under this High Court. In the event it was contended that, by the impugned order in the appeal Tribunal has discarded the enquiry report in view of the breach of the timeline prescribed under Regulation 20 (5), then the impugned order of the Tribunal cannot be sustained in such context.
However, in the facts and circumstances of the present case, the Tribunal has accepted a portion of the impugned order so far as forfeiture of the security deposit of the respondent is concerned. Therefore, in the facts and circumstances of the present case, it cannot be said that the Tribunal has rejected the enquiry report or the order impugned before it in its entirety purely on the ground of the timeline prescribed under Regulation 20 (5) of the Regulations of 2013 being breached.
Thus, the single bench of the Calcutta High Court, comprising Justice Debangsu Basak, held that the timeline prescribed under Regulation 20(5) of the Regulations of 2013 is directory. The Tribunal is vested with the discretion to attach such weightage to the enquiry report as deemed appropriate, after consideration of the same on merits.
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