Andhra Pradesh High Court Quashes Suspension Order Of Customs Broker Licensee Passed Without Giving Opportunity Of Hearing

The Andhra Pradesh High Court has quashed the suspension order passed by the Customs Commissioner suspending the customs broker licence without giving the opportunity for a hearing.

The bench of Justice U. Durga Prasad Rao and Justice Venkata Jyothirmai Pratapa has observed that the Managing Director of the petitioner company was on judicial remand. Through repeated requests were made by the petitioner company, their request was rejected on the ground that the legal time frame fixed under the Customs Broker Licencing Regulations, 2018 (CBLR) would lapse. The Managing Director of the company could not have any opportunity to submit his explanation to the notice issued by the authorities, and while he was in judicial custody, the suspension order was passed.

The petitioner company is a Customs broker that assists importers in the customs clearance of imports and exports, engages in the trading of various goods, and, imports goods from other countries for sale in India. All activities of the Company are looked after by the Managing director, and no other Directors are conversant with its day-to-day affairs. The company contacted an exporter of dried dates and, on terms of the trade, commenced the process for the import of 56,000 kg of dried dates by issuing a purchase order. Next, the exporter issued a Commercial invoice and packing list. After complying with the statutory requirements, the exporter exported the goods through Globe Opus Shipping Line UK Ltd.

The petitioner, being a customs broker, filed a Bill of Entry declaring the cargo as Dried Dates and the import value as Rs. 16.37 lakhs. However, on examination by the Customs, it was found that the cargo contained both Areca Nuts and Dried Dates.

Believing that the petitioner misdeclared both the value and goods, the Customs authorities in Visakhapatnam seized the goods. The Managing Director of the petitioner company was summoned by the Customs Authority and arrested in terms of Section 104 of the Customs Act, 1962, and was subsequently remanded to judicial custody. The Commissioner of Customs issued a suspension order suspending the Customs Broker licence of the petitioner under Regulation 16 (1) of the CBLR for non-fulfilment of Regulations 10 (d) and 10 (e).

The respondent contended that the petitioner has not availed of the opportunity and only requested a postponement of the personal hearing until April 20, 2023. It is a case of illegal import of Areca Nuts by way of misdeclaration with an intention to evade customs duty amounting to Rs. 5.93 crores, and there are no merits in the writ petition.

The court held that It is a settled principle of law that adequate opportunity to be heard, i.e., "audi alteram partem," forms a cornerstone in the doctrine of principles of natural justice. The opportunity must be real, reasonable, and effective, not a mere empty formality. Limitations of time cannot get in the way of giving a real and reasonable opportunity to the affected party for an effective hearing.

Case Title: M/S. Richmark Shipping And Logistics Pvt. Ltd., Versus The Commissioner Customs

Citation: 2023 LiveLaw (AP) 32

Case No.: Writ Petition No.12562 of 2023

Date: 21.06.2023      

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