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Cus - CESTAT can entertain appeals filed against orders of Commissioner passed under Regulation 23 of CBLR, 2013 - view by Tribunal in S.N.M Agency is clearly erroneous - Petition dismissed: High Court

By TIOL News Service

NEW DELHI, NOV 13, 2014: A petition was filed by the Shipping Agency seeking quashing of the order dated 27/29.08.2014 passed by the respondent - Commissioner of Customs (Imports & General), New Custom House, New Delhi in exercise of powers under Regulation 23 of the CBLR, 2013. By the impugned order, the permission granted under Regulation 9(2) of the CHALR, 2004 was revoked and the petitioner was prohibited to continue working as Custom Broker at Delhi Customs Stations.

The respondent, Commissioner of Customs contended that an appeal would lie before the CESTAT against the impugned order by virtue of Regulation 21 of CBLR, 2013.

This submission is disputed by the petitioner who has referred to the decision passed by the CESTAT, Mumbai in the case of M/s. S.N.M. Agency v. CC Mumbai - 2014-TIOL-333-CESTAT-MUM. The CESTAT in the said case has, in effect, held that Regulation 21 of the CBLR, 2013 is ultra vires of Section 146(2) of the Customs Act, 1962 & that an appeal would lie before the Tribunal only against an order of suspension or revocation of a licence.

The High Court adverted to the Regulation 21 of CBLR, 2013 and noted -

"4. Plainly, Regulation 21 of CBLR, 2013 provides for an appeal against any order that may be passed by the Commissioner of Customs and appeals under Regulation 21 of CBLR, 2013 are not limited to orders of revocation of a licence under Regulation 18 of CBLR, 2013 or an order of suspension of licence under Regulation 19 of CBLR, 2013…."

Thereafter the High Court extracted the provisions of section 146 of the Customs Act, 1962 and observed -

"5. It is apparent from a plain reading of Section 146(2) of the Act that it is couched in wide terms and the Board has the power to "make regulations for the purpose of carrying out the provisions of this Section". This power is not circumcised by the specific clauses of Section 146(2) of the Act. The Supreme Court in the case of Union of India v. Azadi Bachao Andolan:- 2003-TIOL-13-SC-IT had explained that the power of an authority to make Rules and Regulations would be wide and not be limited only to the specific provisions contained in the statute but also the object and purpose of the enactment…."

Referring to the apex court decision in Academy of Nutrition Improvement v. Union of India (2011) 8 SCC 274, the High Court held -

"7. …the Board's power to make regulations would not be limited to the specific clauses but also such regulations for the purpose of carrying out the provisions of Section 146 of the Act. The same would include all facets of carrying on business as an agent. I see no lack of competence /or authority with the Board to provide /or appeals -as has been done under Regulations 21 of CBLR, 2013 -against all orders of the Commissioner passed under the said regulations including under Regulation 23 of CBLR, 2013."

The view expressed by CESTAT, Mumbai in S.N.M. Agency - 2014-TIOL-333-CESTAT-MUM was held to be clearly erroneous.

The petition was dismissed with liberty to the petitioner to approach CESTAT by way of an appeal.

(See 2014-TIOL-1939-HC-DEL-CUS)


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