2023 (8) TMI 803 - HC - Customs

Court Orders Conditional Release of Soybean Shipment; Pigeon Peas Cleared, Demurrage Charges Addressed with Port Trust.

Make Index Impex Versus Union of India & Ors.

The HC directed the provisional release of the Soyabean consignment, requiring the petitioner to provide a bank guarantee for differential duty and a bond ... Refusal to clear the goods in question imported by the petitioner - Pigeon Peas - Soya bean - clearance denied on the ground that the goods are genetically modified and which if they exceed the permissible parameters cannot be permitted to be cleared and / or they would be required to be re-exported - HELD THAT:- When the Court was about to pass an order, the concern of the Court was primarily on stand taken on behalf of respondent nos. 1, 8 and 10 coupled with the fact that the FSSAI had taken a clear position that the import in question was permissible for home consumption, as the same was within the norms and fulfillment of standards of FSSAI under the provisions of the Act and the rules made thereunder. In such context, the Court had intended to verify the compliance of the observations as made by the Court in MAKE INDEX IMPEX, A PROPRIETORSHIP CONCERN OF PROPRIETOR RAJESH NAKHUA VERSUS UNION OF INDIA & ORS. [2023 (7) TMI 923 - BOMBAY HIGH COURT], which was to the effect that the goods being imported were safe for human consumption. It is in such context, the Court noted that the affidavit filed on behalf of the FSSAI was not in compliance on what was observed by the Court in above order, and in such context, as a clear affidavit to that effect was not placed by the FSSAI, the Court expressing its dissatisfaction, had adjourned the proceedings for today, to enable FSSAI to place on record clear affidavit in terms of what the Court expected in paragraph 4 of above-mentioned order. Accordingly, a clear stand of the FSSAI is on record that the Soyabean sought to be cleared by the petitioner and subject matter of the present proceedings, in no manner whatever would be harmful for human consumption/health in whatever form, in the light of the requirements and parameters of the FSSAI Act, 2006 and the Rules framed thereunder, if the goods are permitted to be cleared. Thus, the approach as now sought to be adopted by the Customs Department and more particularly in the light of the position taken by respondent no.1-Union of India, respondent No. 8-Genetic Engineering Appraising Committee as also respondent no. 10-Ministry of Environment, Forest & Climate Change and most significantly by respondent No. 7-Food Safety & Standards Authority of India, it is opined that the approach ought to be accepted, and the proceedings, without prejudice to the rights and contentions of the parties on any of the issues, which may arise, be disposed of by permitting provisional release of goods subject to conditions imposed. Petition disposed off. Issues Involved:1. Applicability of Environment Protection Act, 1986 and related rules to the import of Soyabean.2. Applicability of Food Safety and Standards Act, 2006 to the import of Soyabean.3. Conflict between Environment Protection Act, 1986 and Food Safety and Standards Act, 2006.4. Legality of the seizure of Soyabean consignment.5. Provisional release of Soyabean consignment.6. Clearance of Pigeon Peas consignment.7. Demurrage/storage charges imposed by Mumbai Port Trust.Summary:Issue 1: Applicability of Environment Protection Act, 1986The Customs Department refused to clear the goods (Soyabean and Pigeon Peas) on the grounds that they were genetically modified and required clearance from the Genetic Engineering Approval Committee (GEAC) under the Environment Protection Act, 1986. The petitioner argued that the goods were within permissible limits set by the Food Safety and Standards Authority of India (FSSAI).Issue 2: Applicability of Food Safety and Standards Act, 2006The petitioner contended that the import of Soyabean should be governed by the Food Safety and Standards Act, 2006, and not the Environment Protection Act, 1986. The FSSAI's certification indicated that the Soyabean was within permissible limits for human consumption.Issue 3: Conflict between Environment Protection Act, 1986 and Food Safety and Standards Act, 2006The Court noted the larger implications and the need for a clear stand from the GEAC and the Ministry of Environment, Forests, and Climate Change (MoEF&CC). The FSSAI and the GEAC were impleaded as parties to the petition to resolve the conflict between the two Acts.Issue 4: Legality of the seizure of Soyabean consignmentThe petitioner sought to quash the seizure of the Soyabean consignment, arguing it was illegal and arbitrary. The Court noted the divergence of views between the Customs Department, FSSAI, and GEAC. The Customs Department argued that the goods were not cleared by the GEAC, while the petitioner relied on FSSAI's certification.Issue 5: Provisional release of Soyabean consignmentThe Court accepted the suggestion of the learned ASG for provisional release of the goods on the petitioner furnishing a bank guarantee for the differential duty and a bond with appropriate undertakings. The petitioner agreed to use the goods strictly for oil extraction, subject to further FSSAI clearance.Issue 6: Clearance of Pigeon Peas consignmentThe Court noted that there was no hurdle for the clearance of Pigeon Peas, which could be cleared by the petitioner without being entangled in the proceedings concerning Soyabean. The Mumbai Port Authority was directed to permit the clearance of Pigeon Peas upon payment of proportionate demurrage/storage charges.Issue 7: Demurrage/storage charges imposed by Mumbai Port TrustThe petitioner argued that the demurrage/storage charges were incurred due to reasons beyond their control. The Court permitted the petitioner to make a representation to the Chairman of Mumbai Port Trust, who was directed to consider the representation and take a reasonable approach regarding the charges.Conclusion:The petition was disposed of with directions for provisional release of the Soyabean consignment, clearance of Pigeon Peas, and consideration of the petitioner's representation regarding demurrage/storage charges. All contentions of the parties were kept open for any further proceedings.