Port lien for demurrage cannot be enforced against an auction purchaser ready to take delivery of confiscated goods.

Where confiscated goods were sold by Customs and the auction purchaser was ready and willing to take delivery within the stipulated time, the Port Trust could not enforce its lien for rent and demurrage against that purchaser. Once the goods stood confiscated and vested in the Central Government, any claim for charges had to be worked out against the sale proceeds or the party responsible for delayed delivery, not against a purchaser prevented from taking delivery by the authorities. The refusal to deliver the goods on the basis of such charges was held unreasonable and unfair.

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Issues: Whether the Port Trust could demand rent and demurrage from an auction purchaser of confiscated goods and withhold delivery of the goods on that basis.

Analysis: The auction terms required the purchaser to pay rent and demurrage only if delivery was not taken within the stipulated time after confirmation of sale. The purchaser had paid the sale price and wanted delivery, but delivery was prevented by the warehousing authority. Section 59 of the Major Port Trusts Act, 1963 recognises a port lien for charges on goods, but once goods are confiscated under Section 126 of the Customs Act, 1962 they vest in the Central Government, and the port's claim, if any, is to be worked out against the sale proceeds or against the party responsible for delayed delivery. The port could not shift that liability to a purchaser who was ready to take delivery. Refusal to deliver the goods in the face of the internal procedure governing confiscated goods was held to be unreasonable.

Conclusion: The purchaser was not liable for the Port Trust's rent and demurrage charges, and the Port Trust could not refuse delivery on that ground.

Final Conclusion: The impugned order was upheld, and the challenge by the Port Trust failed as the refusal to deliver the goods and insistence on demurrage were held to be unfair and unreasonable.

Ratio Decidendi: Where confiscated goods are sold by Customs and the auction purchaser is ready and willing to take delivery within the stipulated time, the port's statutory lien for charges cannot be enforced against that purchaser for demurrage accrued because delivery was prevented by the authorities; the proper recourse is against the sale proceeds or the party responsible for non-delivery.

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