TaxTMI 
TaxTMI 
2013 (4) TMI 237
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....the petitioner, till the final payment is made." 2. The petition arises with the following factual background. In the year 1998, the petitioner exported 100% Mulberry Raw Silk to its various Indian buyers under 31 different consignments. The goods were shipped from Hong Kong and Singapore. The Indian buyers however, did not take the release of the documents from the bank. The petitioner, therefore, attempted to find new buyers in India who would be interested in purchasing such goods. Upon finding such buyers, the exporter filed necessary Bill of Lading with the customs authorities duly amended in this respect. The customs authorities however did not release the goods in favour of such new buyers. The petitioner, therefore, alternatively prayed for re-shipment of the goods which request was also not considered. 3. The respondent authorities, however, issued seizure orders some time in March 1998 purportedly under Section 110 of the Customs Act, 1962. Subsequently, the customs authorities passed four different orders dated 16-2-1999, 17-2-1999, 1-3-1999 and 8-3-1999 confiscating the goods in question. 3.1 The petitioner had filed four different petitions being Spec....
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....t of restoration of the illegally confiscated goods to the petitioner company, the Custom Authorities would consider the prayer of the petitioner company, based on its investigation and inquiry, to either allow the petitioner company to dispose of its goods to other licenced importers in India or to re-ship them, as is permissible in law. Rule is made absolute with no order as to costs. Sd/- (D.M. Dharmadhikari, CJ Sd/- (A.R. Dave, J)" 5. Despite such order of the Division Bench of this court, the customs authorities initially did not release the goods in order to test the legality of the decision of this court before the Apex Court. However, having filed such S.L.P. challenging the judgment of the High Court and during the pendency of such S.L.P., the Commissioner of Customs, Kandla on 21-7-2001 restored the ownership of the goods to the petitioner exporter by passing the following order :- "Please refer to this office letter even number dated 17-7-2001 on the above referred subject. In the facts and circumstances of the case and respectfully abiding by the order passed by the Hon'ble High Court, Ahmedabad, ownership of the goods is restored to you. Fur....
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....elivery of the goods by making payment to the banks. The petitioner, in the alternative, had also prayed that the entire consignment be permitted to be re-shipped. The customs authorities gave no reply to such letters and had, at all stages, totally ignored the pleas of the petitioner. 9.1 The counsel further submitted that the order of seizure was illegal and unlawful. In any case, the final order of confiscation was passed without any notice to the petitioner and was, therefore, bad in law and in fact, quashed by this court by a judgment dated 18-9-2000. Consequent to such decision, the confiscation having been declared illegal, the petitioner cannot be saddled with the demurrage charges for the containers and the ground rent which the petitioner had to pay to the company. 9.2 In this respect, the counsel relied on the decision of the Apex Court in the case of Shipping Corporation of India Ltd. v. C.L. Jain Woollen Mills reported in 2001 (129) E.L.T. 561 (S.C.) wherein the Apex Court under similar circumstances held the customs authorities liable to bear the charges of demurrage once the order of confiscation was held and declared to be illegal. 9.3 The counsel ....
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....r of confiscation could have been passed. The court held that such requirement was mandatory in nature. Eventually, therefore, the court set aside all four orders of confiscation. Consequently the respondents were directed to restore the goods seized and illegally confiscated to the petitioner company. While doing so, however, the Bench kept liberty open to the respondents to make further investigation into the alleged import of the goods and thereafter take action as may be permissible. It was made clear that as a result of restoration of the illegally confiscated goods to the petitioner company, the customs authorities would consider the prayer of the petitioner based on its investigation and inquiry to either allow the petitioner Company to dispose of its goods to other licensed importers in India or to re-ship them as may be permissible under the law. 13. It is not in dispute that despite such liberty, no further inquiry or investigation was carried out. In any case, no show-cause notice was issued to the petitioner exporter of any further proposed action. In fact, the Commissioner of Customs, Kandla passed an order on 21-7-2001 and restored the ownership of the goods to ....
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....of bearing the burden of demurrage charges thereupon arose and the Apex Court held that the Delhi High Court having set aside the order of confiscation and levying penalty and such order having reached finality, the liability of the importer to pay demurrage charges ceases and that question cannot be re-opened. The court thereafter proceeded to decide the question, namely if the customs authorities do not release the goods and initiate proceedings and finally pass the order of confiscation but that order is ultimately set aside in appeal and it is held by the court of law that detention of the goods was illegal, then in such circumstances, whether the carrier of the goods who had lien over the goods for non-payment of duty, can enforce the terms and conditions of the contract against the customs authorities, making the said authorities liable to pay the demurrage charges. In this respect, the Apex Court held that there is nothing in the Customs Act which would enable the customs authorities to compel the carrier not to charge demurrage charges, the moment a detention certificate is issued. It was observed that it may be true that the customs authorities might have bona fide initiat....