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TMI Blog2022 (7) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 Petition filed under Article 226 of the Constitution of India to issue a Writ of Mandamus directing third respondent to issue the Detention Certificate and other appropriate directions to the concerned Authorities to enable the petitioner to comply with the Order-in-Original dated 05.01.2016 bearing No.43805/2016 by re-exporting the subject consignment to its originating country. 3. By the impugned communication dated 23.12.2018, the third respondent has ordered partial waiver of rent and demurrage of the seized consignment only for the period between 27.01.2015 to 19.10.2015. The impugned order reads as under: OFFICE OF THE COMMISSIONER OF CUSTOMS (CHENNAI II) CUSTOM HOUSE, CHENNAI - 600 001 www.chennaicustoms.gov.in F.No:S Misc.895 /2016-Group 2 Dated:23.12.2016 To 1. M/s. Continental Warehousing Corporation (Nava Sheva), Madhavaram, Chennai-600 110. 2. M/s.Sanco Trans Limited, No:592, Ennore Express High Road, Chennai-600 057. Sir, Sub: Customs - Order in Original No:43805/2016 dated 05.01.2016 passed by Additional Commissioner of Customs (Group 2) in the SCN issued by CZU-DRI in the case of M/s.Sherisha Technologies Pvt Ltd, Chennai - Regarding. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... signment after their import into India was stored in the fourth and fifth respondents Container Freight Station. 7. Under these circumstances, the Additional Commissioner of Customs, the second respondent herein passed the Order-in-Original No.43805 of 2016 dated 05.01.2016. By the aforesaid order, the second respondent held that the imported R22 Refrigerant Gas by the petitioner was without any proper licence and therefore, were liable to be confiscated under Section 111(d), 111(l) and 111(m) of the Customs Act, 1962. By the aforesaid order, the second respondent, also imposed redemption of Rs.10,00,000/- under Section 125 of the Customs Act, 1962 on the petitioner to be paid within a period of fifteen days from the date of receipt of a copy of that order and also imposed penalty under Section 112(a) of the Customs Act, 1962. The order also imposed penalty under Section 112(a) and 114(AA) of the Customs Act, 1962 on the Managing Director of the petitioner. 8. The petitioner also appears to have paid redemption fine and the penalty imposed on the petitioner on 22.01.2016. Thereafter, the penalty imposed on the Managing Director under Section 112(a) and 114(AA) of the Customs Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsion of time for a further period of six months from 29/07/2015 to 28/01/2016 as envsaged under proviso to section 110(2) of the Customs Act, 1962. Accordingly, extension was granted by Commissioner of Customs, Chennai.II vide Order in Original No.40007/2015 in F.No.CAU/DRI/CHE/19/2015 dated 23/07/2015. 12. The learned counsel for the petitioner further submits that though the petitioner had sent several representations both to the second and third respondents herein, and to the fourth and fifth respondents, the owner of the Freight Station. It is submitted that the imported goods were allowed to remain under their custody and no steps were taken for waiver of rent payable for the period before the aforesaid orders were passed and as a result of which the goods still continue to remain in the custody of the respondents four and five and therefore the petitioner was constrained to file W.P.No.15563 of 2017 before this Court. 13. The learned counsel for the petitioner further submits that the writ petition was filed to issue a writ of Mandamus to direct the third respondent herein to consider the representation of the petitioner dated 05.05.2017 in an expeditious manner. It is sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied in impugned communication dated 27.01.2015 to 19.10.2015. 19. The learned counsel for the petitioner submits that as neither the third respondent nor the fourth respondent or the fifth respondent allowed clearance of export goods and the petitioner cannot be forced to pay the aforesaid rent / demurrage charges. 20. Appearing on behalf of the official respondents / the respondents 1 to 3, the learned Senior Standing Cousel submits that imported goods were prohibited goods and the petitioner had attempted to smuggle these goods as free goods and therefore, the petitioner is not entitled for any waiver. 21. The learned counsel for the respondents further submitted that pursuant to Order dated 21.06.2017 of this Court which was received on 12.09.2017 and two personal hearings were held pursuant to the letters dated 03.10.2017 and 04.10.2018 but the petitioner has not chosen to appear and therefore writ petitions are liable to be dismissed. 22. The learned counsel for the repondents further submits that the petitioner did not come forward to pay the amounts as per the impugned order dated 23.12.2016 of the third respondent herein, though a partial waiver of rent / demurrage was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C (3) 151, JT 1995 (2) 452. 2. Shipping Corporation of India v. C.L.Jain Woolen Mills & Ors., reported in 2001 (129) E.L.T. 561(S.C.). 3. Mumbai Port Trust v. M/s.Shri Lakshmi Steels and Ors., reported in 2017 (352) E.L.T.401(S.C.). 4. Wardha Solar (Maharashtra) Pvt. Ltd., v. Union of India & 3 others in W.P.Nos.15490, 16359, 17114 & 17433 of 2020) dated 22.06.2021. 5. M/s.Sai Lakshmi Engineering Limited v. Principal Commissioner of Customs and 4 others in W.P.No.14370 of 2018 dated 01.07.2021. 6. Trip Communication Pvt. Ltd., v. Union of India & Others reported in 2014(302) ELT 321 (Del.) 7. Muscle Fusion Fze v. The Principal Commissioner of Customs & Ors., reported in 2017(354) ELT 525 (Del.). 8. Mate (India) Pvt. Ltd., v. Commissioner of Customs (ICD) and others reported in 2020 (373) E.L.T.666 (Del). 9. International Lease Finance Ltd., v. Union of India and others in W.P.(C) 6490/2018 dated 27.03.2018, (Delhi High Court).. 10. Polytech Trade Foundation v.Union of Inia & Ors in W.P.(C) No.3029/2020 dated 27.05.2021 (Delhi High Court). 29. No doubt, the petitioner had attempted to illegally import R22 Refrigerant Gas in the guise of R410A Refrigerant Gas, in o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R22 Refrigerant Gas. As per the regulations 6(l) of the Handling of Cargo in Customs Areas Regulations, 2009 framed under sub-Section (2) of Section 141 read with Section 157 of the Customs Act, 1962, the Customs Cargo Service Providers shall subject to any other law for the time being in force, shall not charge any rent or demurrage on the goods seized or detained or confiscated by the Superintendent of Customs or Appraiser or Inspector of Customs or Preventive Officer or examining officer, as the case may be. 34. The facts of the case indicates that the third respondent vide impugned order dated 23.12.2016 has granted partial weaver of demurrage for the period between 27.01.2015 (being the date of seizure) upto 19.10.2015, under the regulations of 6(l) of the Handling of Cargo in Customs Areas Regulations, 2009. The relevant portion has been extracted below: 6. Responsibilities of Customs Cargo Service Provider: (1). The Customs Cargo Service Provider shall - (l) subject to any other law for the time being in force, shall not charge any rent or demurrage on the goods seized or detained or confiscated by the Superintendent of Customs or Appraiser or Inspector of Customs or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s hazardous, perishable, live animals, valuable and express cargoes et cetera and license fee. 57. The expression "Transshipment Cargo" has been defined in Regulation 2(zd), to mean cargo which is unloaded from one carrier and loaded or intended to be loaded on the same or another carrier or vehicle for on-carriage to its final destination. 58. The expression "demurrage" also has been defined in Regulation 2(2) of the aforesaid Regulation. It means the rate or amount of charges payable to the authority by the shipper or consigning or carrier or agent or passenger for utilising storage facility at the Cargo Terminal, for storage of cargo, goods, unaccompanied baggage, stores, Courier bags, express parcels,postal mail etc. for extended period beyond the stipulated period for clearance or removal from the Cargo Terminal or of the Customs at the Cargo Terminal. 59. During the relevant period, the cargo had to be cleared within 72 hours of its arrival. By order an dated 02.12.2016, this time has been now reduced to 48 hours by the Director, Ministry of Civil Aviation (ER Division). 60. For the purpose of Transshipment, the authority under the aforesaid Regulations relies on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustoms Authorities. This was introduced much prior to Handling of Cargo in Custom Areas Regulations, 2009. Though a copy of the Public Notice No.111 of 1985 is not traceable, para 2 of the said Public has been reproduced by the Hon'ble Supreme Court in BOARD OF TRUSTEES OF THE PORT OF BOMBAY Vs. JAI HIND OIL MILLS COMPANY, (1987) 1 SCC 648. Same extracted here under from the said judgment:- Paragraph 2 of the said notice sets out the circumstances under which a regular detention certificate could be issued by the Customs House for facilitating the importers to get remission of demurrage charges. They are as under:- "(a) Where the goods are detained by Customs House for bona fide operation of import control formalities without any default on the part of the importers. (b) Where the goods have been released on caution ( a regular detention certificate and not a recommendatory letter). (c) Where the goods are detained [by] the Custom House pending test report and the facility of clearance against provisional assessment has not been allowed. Such detention certificates will be issued on merits for the period for which the goods were detained for the purpose. (d) Where the goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioner is insisting for the "detention certificate" from the 1st respondent so that the 3rd and the 4th respondents can be persuaded to not to charge any rent or demurrage on the imported goods which transshipment from the Chennai Airport. 70. The Superintendent of Customs or the Appraiser or the Inspector of Customs or the preventive officer or examining officer as the case may be can exercise the power to recommend waiver of demurrage and other charges that are chargeable by the custodian of the goods in whose place/premises the goods are stored before being transshipped. 71. In Trustees of the Port of Madras Vs. M/s. Aminchand Pyarelal, (1976) 3 SCC 167, the Hon'ble Supreme Court has held that the Port Trusts were under a statutory obligation to render services of various kinds in the larger public and national interest. 72. The Hon'ble Supreme Court also observed that the demurrage charges are levied in order to ensure quick clearance of the cargo from the harbour and the rates are fixed in such a way that they would make it unprofitable for the importer to use the port premises as a warehouse. In case there is congestion in the port it would affect the free movemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y Act on the other hand are different. The former deals with the collection of customs duties on imported goods. The latter deals with the maintenance of seaports and airports, the facilities to be provided thereat and the charges to be recovered therefore. An importer must land the imported goods at a seaport or airport. He can clear them only after completion of Customs formalities. For this purpose, the seaports and airports are approved and provide storage facilities and Customs Officers are accommodated therein to facilitate clearance. For the occupation by the imported goods of space in the seaport or airport, the Board or the Authority which is its proprietor is entitled to charge the importer. That until Customs clearance, the Board or the Authority may not permit the importer to remove his goods from its premises, does not imply that it may not charge the importer for the space his goods have occupied until their clearance. 44. It cannot be gainsaid that, by reason of unjustified detention of his goods by the Customs Authorities, the importer is put to loss by having to pay demurrage charges for the periods of such detention. The Central Government is empowered by Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nees without collecting demurrage charges from them cannot be enforced by courts either against IAAI or CWC." This Court clearly held that Section 45 of the Customs Act did not, in any manner, affect the rights of the International Airport Authority to collect charges from the importer. 77. In Mumbai Port Trust Vs. Shri Lakshmi Steels, 2017 (352) E.L.T.401 (S.C) : (2018) 14 SCC 317, the Hon'ble Supreme Court held as follows:- 32. Assuming for the purpose of the decision of this case that Mumbai Port Trust is a custodian or cargo service provider, the question that arises is whether these Regulations apply to the Mumbai Port Trust. These Regulations have been framed under Section 157 of the Customs Act. Section 160(9) of the Customs Act clearly lays down that nothing in the Act shall affect the power of the Port Authority in a major port, as defined in the Indian Major Port Trusts Act, 1963. It is not disputed before us that the Mumbai Port Trust is a major port. 33. As already explained hereinabove, the Mumbai Port Trust has the power and authority to levy rates including demurrage as fixed by the Tariff Authority under Section 47-A of the Act. This right of the Port Trust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s is a private contract between the importer and the carrier i.e. shipping line. The DRI/Customs Authorities can be directed to pay the demurrage/detention charges only when it has proved that the action of the DRI/Customs Authorities is absolutely mala fide or is such a gross abuse of power that the officials of the DRI/Customs should be asked to compensate the importer for the extra burden which he has to bear. Even if an importer feels that it has been unjustly dealt with, it must clear the goods by paying the charges due and then claim reimbursement from the Customs Authority. * Handling of Cargo in Customs Areas Regulation, 2009. 78. The Hon'ble Supreme Court while giving the above decision has however not considered the provisions of the Airport Authority of India (Storage and Processing of Cargo, Courier and Express Goods and Postal Mail) Regulations, 2003. Perhaps the Hon'ble Supreme Court may have come to a different conclusion if it had considered the 2003 Regulation. 79. Para 34 of the above decision has practically rendered Regulation 6 of the Handling of Cargo in Customs Area Regulations, 2009 otiose by holding that the said Regulation framed under the Customs Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sufficient indications to show that there was a complete disruption of service at the Air Cargo Complex during the relevant period due to alleged arrest of the officers. In absence of the officers to receive the transshipment application, there could have been total disruption and no application was received which perhaps may have led to the delay. 86. If there were no proper officers or there were only few officers to handle the workload due to alleged arrest and the delay in receiving the transshipment application for being processed by the 1st respondent should not be at the cost of the petitioner. If indeed there was a complete breakdown due to alleged arrest and resulted in disruption of the operations at the Air Cargo Complex, the petitioner should be compensated as such delay cannot be attributed by the petitioner. This would require proper facts being established by the petitioner. 87. Therefore, this aspect would require proper verification. Issue is therefore left open for the petitioner to establish that Customs Department is liable to compensate the petitioner in the light of the observation of the Hon'ble Supreme Court in Mumbai Port Trust Vs. Shri Lakshmi Steels, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Additional Commissioner of Customs (Gr-2) passed Order in Original No.43805 of 2016 dated 05.01.2016 and after the petitioner's appeal was dismissed vide order in Appeal C.Cus II No.373 & 374/2016 dated 19.04.2016 by the Commissioner of Customs (Appeal-II). The said representation was filed for consideration and disposal of the petitioner's representation for full waiver of demurrages payable to the fourth and fifth respondents. 42. The facts on record clearly indicate that the official respondents have also not co-operated with the petitioner for re-export R22 Refrigerant Gas, despite, the Order in Original No.43805 of 2016 dated 05.01.2016 of the second respondent and the subsequent dismissal of the appeal of the petitioner vide Order in Appeal C.Cus II No.373 & 374/2016 dated 19.04.2016. 43. Despite, Order in Original No.43805 of 2016 dated 05.01.2016 passed by the second respondent Additional Commissioner of Customs (Gr-2) as affirmed by the Commissioner of Customs (Appeals-II) vide Order in Appeal C.Cus II No.373 & 374/2016 dated 19.04.2016, the imported goods were not allowed to be re-exported and remained in the custody of the private respondent mainly fourth and fifth res ..... X X X X Extracts X X X X X X X X Extracts X X X X
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