TMI Blog1995 (6) TMI 36X X X X Extracts X X X X X X X X Extracts X X X X ..... d to provide for stevedores. In the meanwhile the Custom House SIIB branch started investigations in the matter of this import and as the matter between different parties viz. shipowners, charterers, suppliers of the consignees of cargo dragged on, the local steamer agent vide their application dated 9-6-1992 sought another amendment in the IGM for converting the remaining cargo of 4634.400 MTs to same bottom cargo apparently to take back the consignment. They had also earlier informed the Port Trust and the Custom authorities in April (2-4-1992 and 11-4-1992) not to let the vessel go out of harbour, as their charges were mounting against the steamerlines. 2.However, subsequently the applicants vide their letter dated 18-6-1992 informed the Port and Custom authorities that the said vessel had disappeared from the harbour. Since the full cargo intended for discharge at Bombay was not unloaded, action under Section 116 of the Customs Act, 1962, was initiated against the steamer agents. The original authority while observing that the applicants had failed in both the respects (i.e. unloading of cargo and disappearance of ship without proper custom clearance) imposed a penalty of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heir responsibility of discharging the goods and other Government departments too somewhat contributed to the situation. Shri Rana was required at this stage to produce relevant documentary proof by way of Port Trust Public Notices etc. to establish that there was little they could do towards unloading of the goods themselves and that it was the normal Port practice that the stevedores and barges had to be arranged by the buyers. He was also requested to indicate, with documentary evidence, arrangements of the payment of the sales price, and freight, unloading and clearance to prove his point that they had absolutely no role to play in unloading the goods without initiative coming from the importers. This alone could vindicate his stand that how, despite their (including officer-in-charge of conveyance) best efforts and intention they were helpless and in difficult situation and authorities (Port Trust Customs) also failed to respond to their various requests aimed at facilitating early unloading, which failure on the part of the authorities reduced their position to that of `captives' for five months in the outer anchorage. This position resulted in one Captain leaving whereupon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levant circumstances. Even if a minimum penalty is prescribed, the authority competent to impose the penalty will be justified in refusing to impose penalty....." According to the learned advocate the above decision of the Supreme Court is clearly applicable in their case inasmuch as they vide their letter dated 2-4-1992 had informed both the Customs and the Port authorities that the vessel should not be permitted to sail till the investigations were completed by the Customs authorities. Again vide their letter dated 11-4-1992 they had also informed the Port authorities that the vessel should not be permitted to sail without their prior concurrence; that this itself showed that their behaviour was not contemptuous and, therefore, no penalty could be imposed. Moreover, during the period 4 to 5 months when the vessel was held up at Bombay they had to incur an expenditure of US $ 5000 per day. Some of the crew had fallen sick. Out of the 18 original crew members, 11 members had to be repatriated which itself shows that the ship was forced to remain on the anchorage on account of consignees' inability to unload the cargo. 10. Another plea raised by the learned advocate was that eve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nding a reasonable explanation rendered by the carrier the penalty cannot be validly imposed. On the other hand, if the order imposing penalties is based on rational consideration of relevant circumstances it does not call for any interference. This observation of the Hon'ble High Court of Kerala in the case of Sorabji Co. v. Collector of Central Excise [1980 (6) E.L.T. 57 (Ker.)] is relevant in the case now before the Government. 14Similarly, as held by the Government of India. in its revisionary jurisdiction In re : Dempo Steamship Ltd. - [1980 (6) E.L.T. 373 (GOI)] "Under Section 116 of the Customs Act, 1962, the liability of the steamer agent for not accounting for the short landed goods is penal in nature. Therefore, it is incumbent ...... to record a finding as to how and in what circumstances the petitioner failed to account for the deficiency ....." 15.The circumstances of the case, as explained by Shri Rana, the learned Senior Advocate, at the time of hearing are indeed not ordinary. Before its suo motu departure without permission of the Port Trust and Customs authorities the ship had been in anchor H-1 for about five months; unable to unload the goods for differ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut they, being authorised agents, cannot be absolved of their part of the responsibility arising out of sudden departure of the vessel even though it was facing hardships. It has also been pleaded that it is always the right of the exporter from abroad to recall the goods in case their payments have not been made by the importers in India and the owners and the shippers have a lien on the goods in such eventuality. This would depend upon the nature of and terms on which goods were imported by the consignee. A close scrutiny of the contract between the consignor and consignee and study of existing practice is thus called for. 17.In short a conscious and detailed exercise to determine the question whether the party has failed to justifiably explain the unloading has to be carried out. The applicants being an agent of the person-in-charge of the vessel undertook responsibility for acts and obligation of the person-in-charge including the consequences of taking away the ship and if found derelict he is open to penal action but the quantum of penalty ought to depend upon the degree of culpability (of the principals viz. person-in-charge) even if the local agent was helpless. This is f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssel failed to produce any evidence in support of the pleading that the balance cargo was sent back. Apparently, therefore, if the party was able to convince him that the balance cargo was in effect taken back the order would have been different. Further the circumstances under which the ship went back are also [important] to determine the penalty. In para 21 it is mentioned that it is irresponsible behaviour on the part of the shipping agents to allege that the department allowed the vessel to take back the balance cargo because the shipping agent himself had not intimated the department the time and date of departure of the said vessel. Can one say that they themselves knew of these details? Perhaps they themselves did not know the plan of the Captain to move the ship and their stand has to be appreciated in the background that they had already incurred losses and had even required the Port Trust Authorities vide their letter dated 11-4-1992 not to let the ship leave the Port. Hence, the cracks in relationship of the principal and agent had already started appearing. Whether the Port Trust Authorities had taken any preventive steps is also a relevant factor (in favour of the appl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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