Deteriorated imported goods: equitable relief allowed-order set aside, disposal authorised and demurrage waiver directed.

Quashing the adjudicating order dated 6.10.2022, the HC declined to decide technical classification and valuation disputes on merits because the consignment had completely deteriorated and equitable relief was appropriate for a small importer; outcome: the original order is set aside. The court directed that the department may deal with the deteriorated goods by auction or destruction and appropriate any realisation with surplus returned to the petitioner; outcome: disposal permitted with surplus payable to petitioner. The court further directed issuance of a demurrage waiver certificate in respect of the subject bill of entry; outcome: waiver certificate to be issued.

---

---

Issues: Whether the order in original dated 6.10.2022 passed by the adjudicating authority sustaining classification/valuation and detention of imported goods should be quashed; and whether the petitioner is entitled to directions for disposal of deteriorated goods and issuance of a demurrage waiver certificate.

Analysis: The Court examined the factual matrix: detention and seizure of goods on 1.3.2022, the adjudication by Respondent No.3 on 6.10.2022, the petitioner's contention of non receipt of a show cause notice, and the joint inspection report showing complete deterioration of the goods. The Court noted competing contentions on classification and valuation but refrained from resolving those technical disputes on merits in view of the condition of the consignment and the disproportionate impact on a small importer. The Court considered equitable reliefs appropriate where goods have no market value and followed its prior order in Writ Petition No.13178 of 2023 regarding provisional release and demurrage waiver certificates. The Court directed that the Department may deal with the deteriorated goods (auction or destruction), that any realisation be appropriated with surplus to the petitioner, and that a demurrage waiver certificate be issued in respect of the subject bill of entry.

Conclusion: The order in original dated 6.10.2022 is quashed and set aside; the Respondents are permitted to deal with the deteriorated goods by auction or destruction with realisation appropriated and any surplus returned to the petitioner; and the Respondents are directed to issue a demurrage waiver certificate in respect of Bill of Entry No.6184455 dated 9.11.2021.

---