2000 (9) TMI 82 - HC - Customs

Summary

Issues Involved:
1. Obligation of Central Warehousing Corporation to release goods without payment of storage and demurrage charges.
2. Liability of Customs authorities for payment of storage and demurrage charges due to wrongful detention of goods.

Summary:

1. Obligation of Central Warehousing Corporation to Release Goods Without Payment of Storage and Demurrage Charges:
The primary issue in this writ petition is whether the Central Warehousing Corporation (CWC) is legally obligated to release the goods stored in the Inland Container Depot (I.C.D.), Hyderabad, to the petitioner company without the payment of storage and demurrage charges, based on the Final Order No. 1568/99 dated 29-6-1999 by the Customs, Excise, and Gold (Control) Appellate Tribunal (CEGAT). The CEGAT had held that the petitioner company was not responsible for the detention of goods and was entitled to a Certificate for Clearance without demurrage charges.

The petitioner company argued that the CWC must release the goods without these charges, while the CWC contended that it was not a party to the CEGAT proceedings and thus not bound by its order. The CWC also emphasized that it is a statutory authority under the Warehousing Corporation Act, 1962, and there is no provision in the Act or Rules for waiving storage charges.

2. Liability of Customs Authorities for Payment of Storage and Demurrage Charges Due to Wrongful Detention of Goods:
The Customs authorities, represented by respondents 2 and 3, supported the petitioner's claim and contended that the CWC is bound to waive demurrage charges as per paragraph (15) of Circular No. 128/95-Cus., dated 14-12-1995. However, the CWC argued that this guideline applies only to private sector establishments, not public sector undertakings like itself.

The court referred to the Supreme Court's judgment in the case of International Airports Authority of India v. M/s. Gulab Impex Enterprises Ltd. [1995 (77) E.L.T. 753 (S.C.)], which established that statutory authorities like the CWC are entitled to charge demurrage even if the goods were detained due to the fault of Customs authorities. The court concluded that while the petitioner company is liable to pay storage and demurrage charges, the burden should be shifted to the Customs authorities, who were responsible for the wrongful detention of goods.

Conclusion:
The writ petition was allowed, directing the Customs authorities to pay the demurrage and other dues to the CWC within 15 days, allowing the petitioner company to lift the goods upon completion of other formalities. The CWC was instructed to release the goods immediately upon receipt of payment from the Customs authorities.