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Principal Commissioner of Customs (Preventive) Versus Suren International Ltd.

Jurisdiction - power to allow refund of the warehousing charges - Whether the CESTAT was justified in holding that the Respondent was not liable to pay rent/warehousing charges in view of the fact that the ownership of the goods remained with it? - Held that: - It is plain from the impugned order of the CESTAT, that there is no mention of the provision of law in terms of which the CESTAT has granted relief to the Respondent. This is a matter for concern since the CESTAT is a statutory tribun .....

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also possible that in terms of the specific provisions of the CA, they may have certain discretionary powers. But even these have to be exercised reasonably and within the ambit of the CA. In no instance can they perform their adjudicatory functions outside the scope and ambit of the enumerated powers under the concerned statutes. - There appears to be no specific provision in the CA or the rules thereunder which contemplates refund of warehousing charges. The Court has also not been shown .....

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, Advocates. For the Respondent : Mr. R. Santhanam and Mr. A.P. Sinha, Advocates. ORDER Dr. S. Muralidhar, J. 1. This is an appeal by the Customs Department ( Department ) directed against an order dated 4th December, 2015 passed by the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) in Appeal No. C/274/2009-CU(SM) allowing the appeal filed by the Respondent, Suren International Ltd. 2. Admit. 3. The following question of law is framed for consideration: Whether the CESTAT was just .....

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; 14,59,101. Additionally, from the premises of the Respondent, goods valued at ₹ 145.72 lakhs and ₹ 395.22 lakhs were seized. Following the investigations, separately carried out by the Directorate of Revenue Intelligence ( DRI ), a show cause notice ( SCN ) was issued by the DRI to the Respondent on 2nd August, 2002. 5. By an adjudication order, dated 30th June 2003, the Commissioner of Customs confiscated the goods, with an option to redeem them on payment of redemption fines of & .....

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tter dated 16th November, 2006 required the Respondent to deposit the warehousing dues of the CWC from May 2003 to 31st November, 2006 in the sum of ₹ 33,99,896. These charges were paid by the Respondent under protest. 8. The Respondent sought refund of the aforementioned sum by way of an application which was rejected by the Assistant Commissioner of Customs by an order dated 5th December, 2008. Against said order, the Respondent filed an appeal which came to be dismissed by the Commissio .....

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ant has paid the same, therefore, the goods were required to be released to the appellant on payment of the amounts confirmed as per adjudication order. The adjudicating authority has not passed any order for payment of rent by the appellant for the period of seizure of goods. In these circumstances, the appellant is not liable to pay rent. As the appellant has paid an amount on account of rent in favour of Commissioner of Customs (Preventive), NCH, New Delhi under protest, the said amount is re .....

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counsel appearing for the Appellant and Mr. R. Santhanam, learned counsel appearing for the Respondent. 12. It is plain from the impugned order of the CESTAT, that there is no mention of the provision of law in terms of which the CESTAT has granted relief to the Respondent. This is a matter for concern since the CESTAT is a statutory tribunal. It derives its powers and jurisdiction from the specific provisions of the statutes it deals with, one of which, in the context of the present appeal, is .....

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and within the ambit of the CA. In no instance can they perform their adjudicatory functions outside the scope and ambit of the enumerated powers under the concerned statutes. 13. In the context of the present case, where refund of a sum paid as warehousing charges is sought by an importer, the authority to whom the application is made will first and foremost, have to examine under what provision of the law such a request is made and whether such a request can in fact be entertained. Significan .....

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not envisage refund of the warehousing charges. Mr Santhanam then referred to Chapter IX of the CA which deals with Warehousing . Here again, he was unable to point out any particular provision in terms of which an importer could seek refund of the warehousing charges after payment of the redemption fine and penalty. 15. Section 49 provides for warehousing of imported goods pending clearance. The Customs authorities can permit the importer, on his making an application, to deposit the goods ente .....

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arance of warehoused goods for home consumption and Section 69 concerns clearance of warehoused goods for export do not envisage refund of warehouse charges. Significantly, Section 73 of the CA, the cancellation of the warehousing bond is conditional upon payment of all amounts due on account of such goods. The expression all amounts is obviously not restricted to the customs duty, penalty, fine etc. It would include the warehousing and/or demurrage charges. Section 141 of the CA states that goo .....

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adjudication powers, to entertain and grant the prayer for refund of warehousing charges. 17. In somewhat similar circumstances, in the context of demurrage charges, this Court in S.K. Metal & Co. v. Commissioner of Customs 2016 (338) ELT 383 (Del) held that there is no scope for the Customs authorities themselves to grant the request for waiver of demurrage charges. After referring to the decisions of the Supreme Court in International Airport Authority of India v. Grand Slam International .....

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the bill of lading, if any. ii. Where the carrier is a corporation incorporated by a statute like for instance, the CWC, or the CCI or SCI then it would be bound by the provisions of the Act as far as its right to recover demurrage or container charges is concerned. iii. Section 45(2) (b) of the Act, which enables the customs authorities to issue a detention certificate, cannot extend to directing the carrier or the owner of the container to waive the charges even where an order of confiscation .....

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ch after analysing the Handling of Cargo under Customs Area Regulations, 2009 the Court held that it is only in cases where on conclusion of the adjudication proceedings there is no imposition of any fine, penalty, personal penalty and/or warning by the customs authorities , that the policy of waiver from payment of demurrage charges would apply and that to subject to other compliances. The above decisions may not directly apply to the facts of the present case where the question concerns refund .....

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