TaxTMI 
TaxTMI 
2010 (4) TMI 455
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....er the provisions of the Major Port Trusts Act, 1963 ("the MPT" for short) governed by the rules and regulations framed thereunder. 4.One M/s. Metal Distributors (UK) Ltd., London in the normal course of business contracted to supply 78 consignments of zinc and copper wire bars to five different parties/consignees in India. The said consignments were shipped during the period September to November, 1991. As per the terms of the contract, the property in the goods were to pass to the consignees only upon their retiring the documents presented for payment through bank. The said dealings with the five parties/consignees were on Cash Against Documents ("CAD" for short) basis. The total quantity involved was (approx.) 1135 MT of zinc and 460 MT of copper wire bars. The total CLE Value of the said goods was (approx) Rs. 7.50 Crores. 5.According to the petitioners, the aforesaid five consignees failed and neglected to retire documents. It appears that the Custom Authority started investigation against those five parties with regard to the validity of import and in the matter of advance licenses held by them. Failure on the part of those five consignees to retire documents put the fo....
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....y accordingly made applications for amendment of the I.G.M. in terms of diverse letters addressed by them during the period April, 1992 to June, 1992 to the Custom Authorities. The petitioners also filed the requisite amendment applications under the provisions of Section 149 and 30 of the Custom Act, 1962. However, none of the said applications were entertained by the Custom, as such, the claim of the petitioners as the legitimate consignee was not recognized by the Custom authorities. 10.According to the petitioners, since they were not recognized as the owners or importers or the consignees of the said goods, there was no question of making them responsible for payment of demurrage charges and holding them vicariously liable, more particularly having regard to the facts that the goods were all along detained for bona fide custom operations and ITC facilities. 11.On 3rd June, 1992, the foreign supplier addressed a letter to the Custom Authorities, inter alia, stating therein that the five parties had failed to retire the documents for a fairly long time and abandoned their claims in respect of the Bills of Entry filed by them earlier, as such they were left with no other al....
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....ach Apex Court by way of SLP, which was, ultimately, converted into an appeal and disposed of on 3rd December, 1992 directing BPT not to deliver or part with the consignments pursuant to the sale effected by the BPT in favour of respondent Nos. 6 and 7 to the SLR The petitioners were directed to pay charges for the two consignments. The petitioners made payments, subject to final orders in the Writ Petition No. 2464 of 1992. 15.The petitioners, during the course of hearing of the Petition No. 1397 of 1992, on 4th August, 1992, were advised to make representations to the Custom Authorities for obtaining clearance of the goods by setting out facts in detail. Accordingly, the petitioners made representation for grant of clearance of the goods covered by the said 78 bills of entry. The Custom Authorities appears to have considered the representations made by the petitioners. A letter was given to the petitioners by the Custom Authorities inter alia; stating therein that with regard to the 37 consignments, which were in the name of the said earlier five consignees, the investigations were still in progress and as such, permission to amend the I.G.M. in case of those 37 consignments c....
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....s lost in effecting amendment to IGM. The petitioner suffered huge amount of demurrage as such their request for remission of demurrage should be considered sympathetically. 20.On 14th September, 1992, the Assistant Commissioner of Custom also wrote to the BPT informing them that the petitioner had been allowed to clear 41 consignments, however, clearance of 37 consignments had not yet been allowed since investigations was pending. It was further informed not to put goods on auction. The petitioner also represented to the Deputy Collector of Custom that out of 41 detention certificates, 32 detention certificates carried period of detention from 9th June,1992 to 9th September, 1992, which was not correct. Attention was also drawn to the letter dated 5th May, 1992. The said Deputy Collector was once again requested to revise the period mentioned in the 32 detention certificates. It appears that the Deputy Collector of Custom accepted the request made by the petitioners and agreed to mention and inform the BPT that the reason for detention was ITC formalities and pendency of the investigation by the Custom. 21.The respondent BPT vide its letter dated 7th October, 1999 did not ac....
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....eriod prior to the noting of the importer's name in the Bill of Entry. In his submission, this act of respondent No. 1 amounts to hostile discrimination against the petitioner and renders their action or decision wholly arbitrary, unreasonable and mala fide in violation of the fundamental rights granted by Article 14 of the Constitution of India. 26.Mr. Shroff, further submits that for the negligence or inaction on the part of the Custom, the petitioners cannot be allowed to suffer punishment and financial losses. He, thus, submits that the petitioners are entitled for the relief claimed in the petition and seeks direction directing the respondents to deposit the amount of Rs. 1,91,14,798/-along with 18% p.a. interest thereon from the date of payment of the respective amounts, with this Court with liberty to the petitioners to withdraw the same unconditionally. Per Contra : 27.Mr. Makhija, learned Counsel for the respondents submits that, in the petition, prior to its amendment, the petitioners had claimed writ of mandamus directing respondent Nos. 4 and 5 i.e. the Union of India and Custom to pay to the petitioners an amount of Rs. 1,91,14,798/-along with interest @18% p.....
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....arbitrary, perverse or contrary to the guidelines. 32.Mr. Makhija, while taking this Court through the sequence of events, right from the date of arrival of the goods in the Custom Area, urged that 78 consignments remained in the Port during the period from November, 1991 to January, 1992. According to him, the BPT was not concerned with the dispute between the petitioners and the Custom Authorities. According to him, the petitioners were allowed to file 41 Bills of Entry in the month of May, 1992 after amendment to the IGM. Thus, the Custom Authorities had accepted the petitioners' title to the goods in respect of 9 consignments only on 1st May, 1992 and on 9th June, 1992 in respect of 31 consignments. He, thus, submits that pursuant to the order dated 1st October, 1992 passed in Writ Petition No. 2132 of 1992, the petitioners had cleared the goods covered by 70 consignments and made payment of Rs.2,81,67,333/- against which respondents have granted remission of an aggregate amount of Rs. 90,52,535/-. Now, the petitioners are claiming refund of Rs. 1.92 crores paid by the petitioners towards demurrage charges, which according to Mr. Makhija, claim made in this behalf is untenab....
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....on of these aspects. Accordingly, in the case of Gilt Pack, 80% remission in demurrage fees for first 150 days of certified detention and 50% remission in demurrage fees for remaining period of certified detention was granted by respondent No. 1. Thus, in the case of Gilt Pack, the original importer and party who originally cleared the goods were one and the same. As at the time of import, Gilt Pack alone had title to the goods and it continued till the date of lifting the goods. 36.Mr. Makhija urged that the facts of the case of the petitioners is altogether different than that of Gilt Pack. In the case in hand, the goods were imported by different parties by noting Bills of Entry. In view of the failure of original importer to clear the goods, the goods were resold by foreign supplier to the petitioners. Since, the petitioners did not have title to the goods at the time of import, remission was granted by respondent No. 1 from the date of noting as per advice of Collector of Custom to whom the case was referred by respondent No. 1 for clarification. 37.With the aforesaid submission, Mr. Makhija submits that there is no violation of Article 14 of the Constitution of India. H....
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....ect matter of the petition. (Emphasis supplied) 40.The reason given by the BPT for not allowing remission of the demurrage charge for the period involved in the aforesaid last item is a subject matter of challenge as indicated in the opening part of this petition. 41.Before going into the reasons assigned by BPT in not allowing remission which the petitioners are demanding through this petition, it is necessary at the cost of repetition to recapitulate the facts in short. 42.A foreign supplier had shipped 78 consignments to 5 parties on CAD basis which landed in Mumbai Port during the period November, 1991 to January, 1992. The said 5 parties failed to retire said documents though they filed 37 Bills of Entry with the Custom seeking clearance of the goods covered thereunder. As the original Importers did not clear the said consignments, in April, 1992, the foreign suppliers sold the-said consignments to the petitioners. The amendment to IGM was sought by the Shipping Company as well as the petitioners. The Custom Authorities did not permit the amendment of the IGM, filing of Bills of Entry and clearance of the goods on the ground of pendency of investigation, under the ....
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.... 33,49,906 11,56,050 21,93,856 4. 2 13,88,476 2,47,095 11,41,381 70 2,81,67,333 90,52,535 1,91,14,798 Balance Amount : 1,91,14,798 45.The respondent-BPT vide their letter dated 16th September, 1995 had advised the petitioners that the detention certificate prior to the date of noting of the Bills of Entry would not be considered for grant of remission but detention certificate, issued for the subsequent period to the date of Noting of the Bills of Entry, would only be considered for the purposes of grant of remission. Ultimately, the remission of demurrage charges was granted by the BPT aggregating to Rs. 90,52,535/-. All these factual aspects unequivocally go to show that 78 consignments had remained in the docks for considerable period of time, from November, 1991 to January, 1992, due to alleged disputes between the petitioners and the Custom Authorities. The goods suffered demurrage charges with which BPT hardly had any concerned. The Custom Authorities had accepted the petitioners' title to the goods in respect of 9 consignments on 1st May, 1992 and in respect of 31 consignments on 9th June, 1992. As such, the BPT holding a view....
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....ing the cases of the petitioner sympathetically and, ultimately, to the extent their case was justified in the hand of the BPT was accepted and remission to the extent of Rs. 90,52,535/- was granted. The respondent No. 1 - BPT has not only considered the case of the petitioner based on the guidelines issued by the Central Government but have also taken into account other factors and, ultimately, came to the conclusion that part of the period for which goods were lying in the Custom area were not entitled to be considered as special case as required under the provision of Section 53 of the Major Port trust Act. If the power of remission is to be exercised by the authority then it has to be exercised only when a special case is made out under Section 53 of the Major Port Trust Act. It has been further submitted that the petitioner ought to have been granted remission for the period from 23-3-1993 till the noting of the bill of entry, especially, when the petitioner applied for review and produced detention certificate and demanded the benefits of the policy guidelines issued on the basis of ITC formalities and independent certificate and the BPT has rejected the claim on the ground t....
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....e incurred while in trading into contract. The petitioners entered into contract with open eyes knowing fully well as to what would be their liability in the event of purchase of goods discarded by earlier consignee. Under these circumstances, in our considered view, the petitioners are not justified in making claim of refund against the respondent-BPT. 50.The reasons given by the authorities cannot be said to be extraneous or not germane to the issue before the authorities nor the said reasons are perverse. In our opinion, the reasoning given in the order indicate that the case of the petitioner could hardly be said to be a special case. 51.Mr. Makhija, learned counsel for the respondent was justified in contending that judicial review is concerned with reviewing not the merits of the decision in support of which the application for judicial review is made, but the decision making process itself. It is thus different from an appeal. When hearing an appeal, the Court is concerned with the merits of the decision under appeal. Since the power of judicial review is not an appeal from the decision, the Court cannot substitute its own decision. Apart from the fact that the Court i....