Customs Dept. Bound by Mandatory Timelines Under CBLR: CESTAT Restores Customs Broker Licence

The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has set aside the suspension of a customs broker licence, holding that the Customs Department failed to strictly adhere to the mandatory timelines prescribed under the Customs Broker Licensing Regulations (CBLR), 2018. The bench of S. S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) directed that the suspended licence be restored within four weeks. The case stemmed from imports cleared in December 2020, where consignments declared as light melting scrap were allegedly found, upon examination by the Directorate of Revenue Intelligence (DRI), to contain dry dates. The goods were seized, and investigations followed, including recording of statements and arrest of an individual connected with the imports. Based on an incident report issued by the DRI, the Commissioner of Customs, Ludhiana, suspended the customs broker licence on 5 February 2021 under Regulation 16(1) of the CBLR, 2018. Personal hearings were scheduled thereafter, documents were supplied after delay, corrigenda were issued, and the suspension was eventually extended. Parallel proceedings were also initiated under the Customs Act, 1962, including issuance of show cause notices to the customs broker and other parties. The principal issue before the Tribunal was whether the failure of the Customs authorities to follow the strict timelines laid down under Regulations 16 and 17 of the CBLR, 2018 rendered the suspension and continuation of proceedings unsustainable. The customs broker argued that Regulation 16 mandates that a personal hearing be granted within 15 days of suspension and that an order be passed within the next 15 days, which was not complied with. Under Regulation 17, a show cause notice for revocation must be issued within 90 days from the offence report, which was admittedly not done. The delay could not be cured by subsequent proceedings, as timelines under CBLR are mandatory. Non-supply of relied-upon documents and rejection of requests for cross-examination violated principles of natural justice. The broker had acted on the basis of valid import documents, including pre-shipment inspection certificates, and had no knowledge of any alleged misdeclaration. Reliance was placed on several High Court judgments, including HIM Logistics Pvt. Ltd., Leo Cargo Services, Aristo Shipping Services, and Neko Freight Forwarders Ltd., which consistently hold that CBLR timelines are sacrosanct. The department contended that the case involved a serious fraud of importing dry dates under the guise of metal scrap, causing substantial revenue loss. It alleged that the customs broker failed to verify the credentials of importers, violated due diligence obligations, and facilitated misdeclaration. The Department argued that delays were justified due to the COVID-19 pandemic and relied on Supreme Court orders extending limitation periods. It also cited judgments emphasising the high degree of responsibility cast upon customs brokers. CESTAT noted that courts across jurisdictions have consistently held that each timeline prescribed under the CBLR is mandatory, and non-compliance vitiates proceedings. In connected proceedings involving the same facts, allegations of masterminding imports, forgery, and beneficial ownership had already been held to be unsubstantiated. While certain lapses on the part of the customs broker were noted, the Customs authorities themselves failed to comply with the statutory procedure. General extensions of limitation during COVID-19 could not override the specific timelines provided under the CBLR, 2018. The Tribunal reiterated that regulatory authorities are equally bound by the law they seek to enforce and cannot selectively disregard procedural safeguards. The Tribunal set aside the impugned order and directed restoration of the customs broker licence within four weeks. It also observed that the licence had remained suspended for over three years, severely affecting livelihood and business operations. The Tribunal held that indefinite or prolonged suspension without strict adherence to procedure is impermissible, particularly when no penalty had ultimately been imposed. Case Details Case Title: M/s Secon Logistics Pvt. Ltd. Versus Commissioner of Customs, Ludhiana Case No.: Customs Appeal No. 60324 of 2022 Date: 17.12.2025 Counsel For Appellant: Saurabh Kapoor Counsel For Respondent: Anurag Kumar Click Here To Read Order Read More: Ignoring H-Forms in Export Sales Assessment Invalid: AP High Court

Customs Dept. Bound by Mandatory Timelines Under CBLR: CESTAT Restores Customs Broker Licence

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