1. M/s. K.M.S. Cargo (P) Ltd. have the present appeal against the suspension of their Custom House Agent (CHA) Licence.
2. Shri Lajja Ram, learned Advocate, submitted that the appellants, customs House Agent, filed import documents for the clearance of heavy melting steel scrap imported by M/s. Bhushan Steel and Strip Ltd. on the strength of the documents made available to them by the importers; that the melting steel scrap was checked before allowing the clearance by the Customs Officers at the Inland contrainer Depot; that the goods were, thereafter, cleared out of the customs charge by the proper customs Officers; that without issuing any show cause Notice or affording any personal hearing, the Commissioner, under the impugned Order dated 5.10.2004, has suspended their license on the ground that an enquiry is contemplated against them for alleged involvement in the clearance of bill of entry of M/s. Bhushan Steel and Strip Ltd. for heavy melting steel after 100% examination; subsequently, some explosives/missiles, etc. were found in the said scrap; that it has been also mentioned in the impugned Order that they, as CHA, failed to discharge the obligation entrusted upon them under CHA Licensing Regulations 2004 in relation to the clearance work of the said hazarduous material. The learned Advocate, further, submitted that the appellants, as CHA, had all along discharged their obligations under the Regulations; that they had filed all the import documents on the strength of the information made available to them by the importers; that the appellants had no role in the act of importation and they had acted in a bonafide manner on the basis of the documents made available to them by the importers; that it has been held in the case of J.G.Exports v. C.C., New Delhi, 2000 (121) E.L.T. 754 (T-LB) that it is no obligation of the CHA to check the credentials of the customers under the CHA Licensing Regulations, 2004; that although in Regulation 20 (2), it is provided that in appropriate cases, where immediate action is necessary, the Commissioner suspend the license of CHA where an enquiry against him is pending or contemplated; that there is nothing in the impugned Order that the present was such an appropriate case as nothing is mentioned in the impugned Order as what immediate act was to be prevented on the part of the appellants; that the Larger Bench of the Tribunal in the case of Freightwings and Travels Ltd. v. C.C., Mumbai, 2001 (129) E.L.T. 226 (Tri-LB), has held that as any suspension entails civil consequences for the CHA, it must be implied from the very nature of the function to be performed by the Commissioner under the said sub-Regulation 21(2) of CHA Licensing Regulation 1984 that he exercises a quasi-judicial function and has, ipso facto, a duty to give a reasonable opportunity to be heard to the CHA. Reliance has also been placed by the learned Advocate in the case of Cargo Care v. C.C., New Delhi (Final Order No. 757/04-NB(C) dated 15.10.2004 wherein the Tribunal had set aside the suspension Order as the same deprives of CHA of his profession. Finally, the learned Advocate, mentioned that subsequent developments and the spate of instructions on the checking of imported scrap highlight the multi dimensions of the problem; that with all the resources at their command, the Customs Department is finding handicapped in organising fool proof checks of the imported scrap. In such a secnario it was not just and proper for the Commissioner of Customs to suspend their licence affecting the livelihood of the CHA and its employees; that, moreover, it is not known as what enquiry is being conducted against them as after passing of the impugned Order, nothing has been heard from the Department in the matter.
3. Countering the arguments, Sh. Randhir Singh learned JDR, submitted that subsequent to the clearance of the cargo, explosives/missiles, etc. were found among the scrap imported by the importers, M/s. Bhushan Steel & Strip Ltd. for clearance of which documents were filed by the appellants; that the appellants were present during the examination of the Cargo; that there was lapse on the part of the appellants in not detecting the explosives/missiles, etc. at the time of examination of the cargo. The learned D.R. also mentioned that investigation by the Officers of the Customs Department is in progress with regard to the role of appellants for ascertaining his involvement; that even the Customs Officers who examinined the cargo have been suspended; that the Appellants' CHA Licence had been suspended as presence of explosives/missiles was not pointed out by the CHA during or after the examination; that as the enquiry is in progress, the suspension of his licence is required to be continued.
4. We have considered the submissions of both the sides. The material brought on record only goes to show that after clearance of the scrap imported by M/s. Bhushan Steel & Strip Ltd., certain explosives/missiles, etc. were found among the scrap. The necessary documents for the clearance of the impugned scrap were filed by the appellants. According to the appellants, the documents were filed on the basis of their duty, the CHA had also accompanied the Customs Officers at the time of examination of the cargo. A perusal of the impugned Order show3s that the cargo was examined 100% by the Officers.
Even 100% examination conducted by the Officers could not reveal the existence of the explosives and missiles in the imported goods. The explosives and missiles in the imported goods. The reason for suspending the CHA licence of the appellants apparently is lapse on their part in not detecting those explosives at the time of examination. The examination of the imported goods is the duty of the Customs Officers and the CHA does not play any role in examination. He accompanies the Officers only as an agent of the importer. No Regulation of the CHA Licensing Regulations, 2004 enjoins the duty or obligation on the CHA to help the Officers in examining the goods. The obligations of the CHA are contained in the Regulation 13, the perusal of which reveals that there is no obligation on CHA for carrying out the examination of the imported material. Nothing has been brought on record by the Revenue to show any lapse on the part of the appellants warranting continued suspension of their CHA licence which is the source of livelihood not only of the appellants but their employees also. we, therefore, find no reason to continue the suspension of the CHA licence Order in October, 2004. We, therefore, set aside the impugned Order and allow the appeal. However, we make it very clear that if the investigation, which is being carried out by the Customs Department and Policy authorities, reveal any involvement of the appellants in the import of scrap with explosives/missiles, etc. The Department is at liberty to take any action under the provisions of Customs Act or CHA Licensing Regulations, 2004 or any other law for the time being in force.