Page 45 - ELT_15th July 2020_Vol 373_Part 2

2020 ] PROCESS OF SUSPENSION OF IEC NUMBER A51

mount to egregious violation of ‘Principle of Procedural Fairness’. This principle
was elevated to Principle of Natural Justice (commonly known as “PONJ”) by
Hon’ble Apex Court in Dharampal Satyapal Limited v. Deputy Commissioner of Cen-
tral Excise, Gauhati & Others, 2015 (320) E.L.T. 3 (S.C.). Therefore, any order
passed without adhering to these procedures will be a patent infraction of PONJ
liable to set aside. It must also be borne in mind that any suspension order
passed under this provision has to be speaking i.e. reasons which formed the
bedrock for the passing of such suspension order must be spelt out very clearly.
On this point attention is adverted to the following pertinent observation made
by Hon’ble Madras High Court in M/s. Kawarlal & Co. v. Joint Director General of
Foreign Trade and Others (W.P. No. 25693 of 2019) -
“Needless to say that the Licensing Authority, if intends to suspend or cancel
the license, should state specific details and particulars as to the reasons
which made him to take such action. In the absence of any such finding or
reason, such order cannot be sustained. At the same time, this Court makes it
very clear that it is not expressing any view on the merits of the allegations
made against the petitioner and the response given by the petitioner against
such allegations. This Court is inclined to interfere with the impugned order
only on the reason that it does not disclose, reflect or finding for suspending
the IEC of the petitioner. Therefore, the matter needs to go back to the first re-
spondent once again for passing a speaking order.”
Can Sections 8 and 11 be applied simultaneously while passing suspension or-
der
It is submitted that both Sections 8 and 11 goes in two different sphere
and both are independent to each other; therefore, if there is a contravention of
Section 11, the provisions of Section 8 cannot be resorted.
Section 11 is a full-fledged provision which takes within its fold follow-
ing aspects :
• Situations under which fiscal penalty can be imposed.
• Modes of recovery of such penalty.
• Tentative suspension of IEC in case person fails to fiscal penalty u/s
11(7).
• Confiscation of goods for contravening provisions of the FTDR Act
or any rules or orders made thereunder or foreign trade policy.
• Redemption Fine that needs to be made for causing the release of
goods confiscated u/s 11(8).
A bare perusal of Section 11 makes it clear that in case there is any con-
travention as contemplated under FTDR, consequence which would ensue
would be one as enumerated from Sections 11(2) to 11(4) i.e. imposition of fiscal
penalty. It is only when the fiscal penalty imposed under sub-sections (2) to (4) is
not paid, resort can be have to sub-section (7). Relevant portion of the same is
reproduced herein below :
“(7) Without prejudice to the provisions contained in this section, the Im-
porter-Exporter Code Number of any person who fails to pay any penalty
imposed under this Act, may be suspended by the Adjudicating Authority till
the penalty is paid or recovered, as the case may be.”
From the perusal of sub-section (7), it is clear that under Section 11 order
EXCISE LAW TIMES  15th July 2020  45