LA Freightlift Pvt. Ltd. vs CESTAT, Chennai

R. Sudhakar, J.�This Civil Miscellaneous Appeal is filed by the appellant as against the order of the Customs, Excise and Service Tax Appellate Tribunal raising the following substantial questions of law:

"(a) Whether the Hon''ble CESTAT was justified in concluding that the case of the appellant herein did not warrant interference and thereby dismissing the application for stay of the suspension of the license of the appellant in terms of Regulation 19(1) of the CBLR, 2013?

(b) Whether the Hon''ble CESTAT was justified in concluding that the case of the appellant herein did not warrant interference and thereby dismissing the application for stay of the enquiry proceedings contemplated in terms of Regulation 19 of the CBLR, 2013?

(c) Whether violations of any of the Regulations of the CBLR, 2013 by the customs agent automatically attract suspension of their license in terms of Regulation 19 of the CBLR, 2013?

(d) Whether suspension of the licence of the appellant pending enquiry is prejudicial to the fair conduct of the enquiry by the inquiry officer, in light of the fact that violations of the regulations under CBLR, 2013 would not per se result in suspension/revocation but may also lead to imposition of penalty alone?

(e) Whether the Adjudicating Authority passing the preliminary Order of Suspension, conducting the preliminary enquiry and rendering a finding that the appellant is in blatant violation of the alleged Regulations of CBLR, 2013, consequently issuing a Show Cause Notice for the same allegations and appointing an inquiry officer to conduct the enquiry?

(f) Whether the Adjudicating Authority by rendering a finding in pursuance of the preliminary enquiry concluding that the appellant is in blatant violation of the alleged Regulations of CBLR, 2013, has travelled beyond the scope of his reference, which is against the scope of the powers conferred on him under Regulation 18 & 20 of the CBLR, 2013?

(g) Whether a categorical perverse finding by the Adjudicating Authority, concluding that the appellant is in blatant violation of the alleged Regulations of CBLR, 2013, is prejudicial to the fair conduct of the enquiry by the inquiry officer?"

The appellant - M/s. La Freight Lift Pvt. Ltd. - Customs broker is issued with a regular customs broker licence valid upto 4-8-2018 at Chennai Commissionerate as parent license in terms of Regulation 8 of CHALR, 2004. The appellant has been in the business of Customs House Agents for more than 10 years and have an unblemished service record without any inquiry initiated against them. It appears that the Docks Intelligence Unit (in short, DIU), Custom House, Chennai investigated a case in which red sanders were attempted to be smuggled in the guise of MS round pipes vide SB No. 9880221, dated 5-2-2014 and the exporter was M/s. Dharani Roofing Plant Pvt. Ltd., Coimbatore. The appellant had acted as the customs broker for the export consignment. The allegation of the Department is that the appellant had acted as a customs broker in the transaction based on the representation of Badri K. Narayanan, who was the main culprit in the attempt of smuggling of red sanders in the guise of MS Pipes. For this alleged violation, the Customs Department suspended the operation of the customs broker licence by order dated 17-4-2014. In response to the same, the appellant submitted written submissions and thereafter an order of suspension was extended by order dated 20-5-2014 and thereafter a show cause notice was issued on 2-6-2014 for inquiry into the alleged violation.

As against the Order-in-Original passed on 20-5-2014 extending the order of suspension of licence, the appellant pursued the matter before the Tribunal along with an application for stay of the order of suspension. Since the hearing of the application got delayed, the appellant approached this Court by filing a Writ Petition in W.P. No. 18911 of 2014 for early hearing of the appeal and the stay petition filed before the Tribunal. This Court, by order dated 17-7-2014, issued directions to the Tribunal. The relevant portion of the order of this Court reads as follows:

"5. Though the petitioner prayed for the relief of directing the first respondent Tribunal to dispose of the appeal itself, this Court, taking into consideration of the fact that very many appeals are pending, is of the view that it is suffice to direct the first respondent Tribunal to take up the application for stay first and pass appropriate orders.

In the result, the writ petition is disposed of by directing the first respondent, namely, Customs, Excise and Service Tax Appellate Tribunal, to take up the stay application of the petitioner and dispose of the same in accordance with law, within a period of four weeks from the date of receipt of a copy of this order."

Pursuant to that, the Tribunal took up the matter and dismissed the stay application stating that the entire issue should be considered at the time of hearing of the appeal. Aggrieved by the order of the Tribunal, the appellant has filed the present Civil Miscellaneous Appeal.

Heard Mr. G. Masilamani, learned Senior Counsel appearing for the appellant and Mr. Xavier Felix, learned counsel appearing for the respondent and perused the materials placed before this Court.

A perusal of the order of the Tribunal shows that none of the plea with reference to prima facie case has been considered by the Tribunal. All that the Tribunal held is that the challenge to the impugned order on perversity will be decided after examining the evidence in detail at the time of hearing of the appeal and therefore, the stay application was disposed of and the early hearing application was dismissed as infructuous. We also find that the Tribunal has not considered the prima facie case for considering the interlocutory application sought for by the applicant. To that extent, the prejudice and hardship pleaded by the appellant justifies the filing of the present Civil Miscellaneous Appeal before this Court. In view of the above, we are inclined to remand the matter to the Tribunal to dispose of the appeal itself. Accordingly, this Civil Miscellaneous Appeal is allowed and the matter is remanded to the Tribunal to dispose of the appeal itself, which according to the learned senior counsel has been posted in the month of October, 2014 itself. Hence, the Tribunal is requested to dispose of the appeal filed by the appellant before the end of December, 2014. No costs. Consequently, M.P. Nos. 1 and 2 of 2014 are closed.