Discretionary waiver of cost recovery charges depends on fulfilment of Customs Manual conditions and prior consideration of the claim.

A custodian appointed under the Customs Act remained liable to pay cost recovery charges unless a waiver was granted under the applicable Customs Manual provisions. Clauses 2.8 and 2.10 of Chapter 28 permit exemption only on fulfilment of stipulated conditions, and the use of "may" shows that waiver is discretionary, not automatic. Because no waiver order had been passed, the demand for cost recovery charges could not be quashed. The pending waiver representation was nevertheless required to be considered in accordance with law.

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Issues: Whether the petitioner was entitled to waiver or exemption from payment of cost recovery charges and whether the demand for such charges could be quashed.

Analysis: The petitioner, having been appointed as custodian under Section 45(1) of the Customs Act, 1962, was liable to pay cost recovery charges unless exempted under the applicable Customs Manual provisions. Clauses 2.8 and 2.10 of Chapter 28 of the Customs Manual permit waiver only upon fulfilment of the stipulated conditions, and the use of the word "may" indicates that exemption is not automatic but depends on the authority's consideration of the claim. Since no order granting waiver had been passed, the petitioner remained bound to pay the charges. The demand could therefore not be interfered with, though the pending representation seeking waiver required consideration.

Conclusion: The challenge to the demand failed and the writ petition was dismissed. The petitioner was, however, granted a direction for consideration of the pending waiver application in accordance with law.

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