Issuance of Show Cause Notice u/a 124 instead of Section 146 of Customs Act with Regard to Customs Broker licence is Void ab initio: CESTAT [Read Order]

The Kolkata Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the issuance of show cause notice under Section 124 instead of Section 146 of the Customs Act 1962, with regard to the customs broker licence was void ab initio.

The Department issued a show cause notice to the respondent, Axis Shipping Agency whereby it alleged that the respondent had violated the provisions of Regulation 11 of Customs Broker Licensing Regulations 2013 (CBLR) (Regulation 13 of Customs House Agents Licensing Regulations, 2004), at the time of applying for a new Customs House Agents Licence, in terms of Section 146 of the Customs Act, 1962.

Tariq Suleiman, appeared on behalf of revenue

The two- Member Bench of P. K. Choudhary (Judicial) and Rajeev Tandon Member (Technical) noted that Section 146 of the Customs Act provided for the Licensing of a Customs Broker who was required to carry out various functions and responsibilities under the statute for and on behalf of the importing and exporting community. It was vested in the Board powers to make regulations for the purpose of carrying out the various functionalities as required under Section 146 of the Customs Act.

The Bench noted that the opening sentence of the impugned show cause notice was as “Notice to Show Cause, Under Section 124 Of The Customs Act, 1962”

It was noted that Section 124 of the Customs Act, deals with the subject of issuance of notice before adjudicating confiscation of goods. The said section does not cater to a situation concerning issuance of a notice to an individual seeking a Customs Broker Licence, in terms of Section 146 of the Customs Act.

The Bench further held that the issuance of the impugned notice under Section 124 of the Customs Act, for the aforesaid purpose, was just not made out under the statute and show cause notice issued by the Department is ab initio void and is therefore liable to be quashed.

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