2007 (12) TMI 201 - HC - Customs

Court affirms consignee's sole liability for demurrage charges on imported goods at Madras Port

The court upheld the Trial Court's decision, ruling that only the consignee is liable for demurrage charges on imported goods at Madras Port. The ... First respondent was a Steamer agent of the ship - second respondent was the consignee of the imported goods – who is liable to pay Demurrage chargers – second respondent, consignee of goods was Holder of Bill of Lading, so he was bound to clear goods from Port - while, first respondent, steamer agent had nothing to do with clearance of goods from Port – therefore, only consignee of goods was liable to pay demurrage charges - appeal by board of trustees of the port is dismissed Issues:Interpretation of liability for demurrage charges between steamer agent and consignee.Analysis:The case involved an appeal against a judgment and decree made in a lower court regarding demurrage charges on imported goods at Madras Port. The appellant, a Port Trust, claimed demurrage charges against the consignee and the steamer agent. The consignee failed to clear the goods, leading to an auction where the goods were sold. The Trial Court decreed the suit only against the consignee, not the steamer agent. The appellant appealed the decision.The appellant argued that based on legal precedents, the liability to pay demurrage charges lies with the consignee, as per the Bills of Lading Act. The consignee, being the owner of the goods, is responsible for clearing the goods from the Port Trust premises. The appellant relied on Supreme Court judgments to support this argument. The contract is between the Port Trust and the consignee, making the consignee liable for demurrage charges.The appellant further referenced the Indian Contract Act, stating that in bailment cases, the bailee (Port Trust) must take care of the goods bailed as a prudent man would. Therefore, the consignee, as the bailor, was obligated to clear the goods by following legal formalities. The steamer agent, not involved in the clearance process, is not liable for demurrage charges. The court upheld the Trial Court's decision, dismissing the appeal and confirming that only the consignee is liable for the demurrage charges.In conclusion, the judgment emphasized that based on legal principles and previous court decisions, the consignee, as the owner of the goods, is responsible for paying demurrage charges. The steamer agent has no obligation in this regard. The court found no error in the Trial Court's decision and dismissed the appeal without costs.