M/S. Cargo Care International v. Commissioner Of Customs - Kerala High Court, 20 June 2022

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. MONDAY, THE 20TH DAY OF JUNE 2022 / 30TH JYAISHTA, 1944 WP(C) NO. 14202 OF 2022 PETITIONER: M/S. CARGO CARE INTERNATIONAL, 2ND FLOOR, HINA HOUSE, K.P.K. MENON ROAD, WILLINGTON ISLAND, COCHIN-682 003, REPRESENTED BY ITS MANAGING PARTNER BENNY FRANCIS, AGED 64 YEARS, S/O.LATE FRANCIS. V.M., R/O. VAZHAPPILLY HOUSE, EXCELOL PARK, STP ROAD, ELAMKULAM, KADAVATHARA POST,-682 020. BY ADVS. P.A.AUGUSTIAN JOVIT LOBO RESPONDENT: COMMISSIONER OF CUSTOMS, CUSTOM HOUSE, WILLINGTON ISLAND, COCHIN-09. BY ADV P.G.JAYASHANKAR THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 20.06.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

W.P.(C)No.14202/2022 2 JUDGMENT The petitioner has approached this Court challenging Ext.P4 order by which its licence issued in terms of Ext.P5 Regulations has been suspended on the allegation that the petitioner failed to carry out due diligence and follow KYC norms in respect of a export for which the petitioner had filed documents on behalf of the exporter. It is alleged that, in a consignment of oil tanks in respect of which the documents were filed, 2150 Kgs of red sanders which, is prohibited for export, was found by the Directorate of Revenue Intelligence.

The learned counsel appearing for the petitioner submits that Ext.P4 order is totally unsustainable and not in accordance with the provisions of Ext.P5 Regulations. It is pointed out that the petitioner has clearly complied with all the requirements of Ext.P5 Regulations as is evident from Ext.P3. It is submitted that the Regulations require the petitioner only to verify the genuineness of documents submitted by the exporter and no further physical verification of the genuineness of the exporter is expected of a Custom House Agent. It is submitted that a licence issued under the Custom House Agents Regulations can be suspended only in the case of grave

W.P.(C)No.14202/2022 3 urgency and no such urgency is expressed in Ext.P4 order. It is submitted that the entire business of the petitioner has come to a stand still on account of suspension of licence and the suspension of licence is causing grave prejudice to the petitioner.

The learned Standing Counsel appearing for the respondent Department submits that the petitioner is clearly not entitled to any relief from this Court especially considering the fact that the petitioner was proceeded against earlier also for failing to comply with KYC norms and for failure to verify the genuineness of the documents submitted by an exporter. It is submitted that on the earlier occasion while the licence of the petitioner was suspended, he had approached this Court through W.P.(C)No.1288/2018 and this Court had declined interference under Article 226 of the Constitution of India. It is submitted that a writ appeal filed against the judgment of this Court in W.P.(C)No.1288/2018 was also dismissed. It is submitted that even at that point of time, the petitioner had directly approached this Court under Article 226 of the Constitution of India on the ground that there was no regular sitting before the CESTAT, Bangalore where the petitioner has an alternate remedy.

The learned counsel appearing for the petitioner submits

W.P.(C)No.14202/2022 4 that nowhere in Ext.P4 order has it been mentioned that the licence of the petitioner was suspended on account of the fact that there were earlier proceedings against the petitioner. It is submitted that Ext.P4 order also does not show any urgency for suspending the licence of the petitioner. He relies on the judgment of the Culcutta High Court in N.C. Singha & Sons v. Union of India; 1998(104) E.L.T.11 (Cal.) and East West Freight Carriers (P)Ltd. v. Collr. Of Customs, Madras; 1995(77) E.L.T. 79 (Mad.) to contend that unless there is grave urgency, the licence of the petitioner could not have been cancelled. It is also pointed out that Regulation 16 of Ext.P5 also indicates that suspension is to be made only in cases of grave urgency and when immediate action is required.

Having regard to the facts and circumstances of the case and considering the contentions taken by both sides and taking note of the fact that Ext.P4 does not show any reason compelling the authority to take immediate action, I am of the opinion that Ext.P4 can be set aside directing the respondent to reconsider the matter after affording further opportunity of hearing to the petitioner. Accordingly, Ext.P4 order is set aside. Considering the urgency expressed by the petitioner, the respondent shall pass fresh orders within a period of ten days from the

W.P.(C)No.14202/2022 5 date of receipt of a certified copy of this judgment. Though Ext.P4 order has been set aside, I make it clear that the suspension imposed by Ext.P4 will continue to operate till a fresh decision is taken by the respondent as above. The respondent shall take note of the judgment referred to in this judgment while taking a fresh decision as directed above. GOPINATH P. JUDGE acd

W.P.(C)No.14202/2022 6 APPENDIX OF WP(C) 14202/2022 PETITIONER EXHIBITS Exhibit P1OF THE CUSTOMS BROKER LICENSE NO.200. Exhibit P2OF THE ORDER OF SUSPENSION DATED 25.03.2022. Exhibit P3OF THE SUBMISSION MADE BY PETITIONER DATED 31.03.2022 ALONG WITH COPIES OF THE VERIFICATION OBTAINED FROM DIRECTOR GENERAL OF FOREIGN TRADE (DGFT) WEBSITE REGARDING GENUINESS OF IE CODE AND GST VERIFICATION FROM GST POST. ETC. Exhibit P4OF THE ORDER F.NO.S9/16/2001 I & B CUS PT. II DATED 12.04.2022. Exhibit P5OF THE CUSTOMS BROKER LICENSING REGULATION, 2018.