Confiscated prohibited goods may be re-exported only on payment of lawful demurrage or ground rent.

Health products misdespatched to India were held not to be shown as a bona fide mistake because the invoice and airway bill identified a Delhi consignee, and the goods fell within the statutory prohibition under the Food Safety and Standards Act, 2006. They were therefore treated as prohibited goods liable to confiscation under the Customs Act, 1962. After confiscation, re-export was permitted only subject to lawful charges, because the power under Section 125 did not displace the custodian's entitlement to demurrage or ground rent, and the cargo-handling regulation operated subject to other laws. The writ petition failed, and re-export was allowed only on payment of the demanded charges.

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Issues: (i) Whether the consignment of health products was wrongly sent to India by bona fide mistake or constituted prohibited goods liable to confiscation; (ii) Whether, after confiscation, the petitioner was entitled to re-export the goods without payment of demurrage or ground rent.

Issue (i): Whether the consignment of health products was wrongly sent to India by bona fide mistake or constituted prohibited goods liable to confiscation.

Analysis: The available contemporaneous documents, including the invoice and airway bill, showed Visha Enterprises, Delhi as consignee, and there was no reliable material to support the claim that the goods were meant for Singapore or were misdespatched by mistake. The goods were health products falling within the statutory prohibition under Section 22 of the Food Safety and Standards Act, 2006. Goods prohibited by law are liable to confiscation under Section 111(d) of the Customs Act, 1962 and fall within the definition of prohibited goods under Section 2(33) of that Act.

Conclusion: The consignment was not established to be a bona fide mistake and was liable to confiscation as prohibited goods.

Issue (ii): Whether, after confiscation, the petitioner was entitled to re-export the goods without payment of demurrage or ground rent.

Analysis: The statutory power under Section 125 of the Customs Act, 1962 contemplated an option to pay fine in lieu of confiscation, and the obligation to pay charges remained attached to confiscated goods. Regulation 6(1)(l) of the Handling of Cargo in Customs Area Regulations, 2009 is expressly subject to other laws in force and cannot override the Customs Act. The governing precedents recognised that waiver of demurrage is not automatic, and where the importer is at fault and the goods are confiscated, the custodian may recover demurrage or rent. Re-export was therefore permissible only on compliance with the charges lawfully leviable.

Conclusion: The petitioner was not entitled to re-export the goods without payment of demurrage or ground rent.

Final Conclusion: The writ petition failed on merits, and the goods could be re-exported only after payment of the demurrage or ground rent demanded by the custodian.

Ratio Decidendi: Goods found to be prohibited and confiscated under the Customs Act cannot be re-exported free of demurrage where the relevant waiver regulation is expressly subject to other law and no bona fide mistake is established.

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