TaxTMI 
TaxTMI 
2020 (5) TMI 476
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....on of goods and passengers has been issued with Demurrages and Transshipment charges by the 3rd/4th respondent for delay in transshipping the cargo brought by them for being transshipped to Trivandrum International Airport during the period between 26.11.2009 and 13.12.2009. 4. It is the case of the petitioner that since it has wide-bodied cargo aircrafts and since there is no facility for landing of such aircrafts in Trivandrum, the petitioner brought the cargo in these aircrafts to the Chennai International Airport for being transshipped to Trivandrum/Calicut by road. 5. The cargos meant for being discharged at the Trivandrum Air Cargo Complex were transshipped from Chennai Air Cargo Complex by road in its bonded vehicles after some delay. 6. Since there was delay in transshipment as a result of which the petitioner has been asked to pay transshipment and the demurrage by the Air Port Authority of India, Air Cargo Complex, Chennai. 7. The Chennai International Air Cargo Complex represented by 3rd / 4th respondent is the custodian of imported goods within the customs area under Section 45 of the Customs Act, 1962 had demanded a sum of Rs. 82,89,226/- vide its bills fro....
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....at query raised in letter dated 14.12.2009 by the 2nd respondent was also not bonafide and intended to deflect the inhouse problem faced by the Customs Department at that point of time. 16. The petitioner replied to the letter dated 14.12.2009 of the 2nd respondent and stated that the reasons for bringing the goods to Chennai. Subsequently, the 2nd respondent accorded transshipment permission for the goods after an inordinate delay of more than three days and in some cases the delay has been extended to twenty eight days. 17. It is submitted that there was a clear inaction by the 1st and 2nd respondents in not facilitating free movement of imported cargo expeditiously by granting transshipment permission. 18. Since the 4th respondent issued a demand notice dated 08.02.2010 and called upon the petitioner to settle the dues accumulated due to the delay in transshipment, the petitioner submitted a letter dated 12.02.2010 to the 1st respondent and requested for issue a "Detention Certificate' to recommend waiver of extra transshipment and demurrage charges incurred since the delay in transshipment was not due to the fault or negligence of the petitioner. The petitioner has als....
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.... 26. These allegations regarding arrest of the customs officials of the Air Cargo were not the basis of the writ petition. These were highlighted for the Court to take judicial notice of the prevailing ground reality then which had totally crippled and disrupted the transshipment operation. 27. However, in the affidavit filed in support of the present writ petition, the petitioner has merely stated that the customs department did not permit them to file transshipment application on time and therefore request was sent to the 1st respondent on 11.12.2009 to permit transshipment of the subject goods. The learned counsel for the petitioner relied on the following judgments: i. Shipping Corporation of India Limited Vs. C.L. Jain Woolen Mills, 2001 (129) ELT 561 (SC). ii. Agrim Sampada Limited Vs. UOI, 2004 (168) ELT 15 (Del.) iii. R.K. Enterpries Vs. Board of Trustees, Chennai Port Trust, 2010 (257) ELT 67 (Mad.). iv. Mumbai Port Trust Vs. Shri Lakshmi Steels, 2017 (352) ELT 401 (SC). v. Trip Communication Pvt. Ltd. Vs. Union of India & Others, order dated 28.03.2014 passed by the Delhi High Court in W.P.(C).No.7438 of 2018. 28. The r....
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....vidence Act. News items from newspaper cannot be treated as proof of the facts stated therein. It is submitted that the content of newspaper are hearsay and are not genuine. The learned counsels for the respondents relied on the following decisions:- i. Mumbai Port Trust Vs. Shri Lakshmi Steels and Others, (2018) 14 SCC 317. ii. Ravinder Kumar Sharma Vs. State of Assam and Others, (1999) 7 SCC 435. iii. Kunjikoya Vallana Kunnummal Vot House Vs. Chairman, Cochin Port Trust, 2019 (344) E.L.T. 810 (Ker.) iv. Jindal Drugs Limited Vs. Union of India, 2018 (361) E.L.T. 769 (S.C.) 34. The 3rd and the 4th respondents have stated that the petitioner is not entitled to any waiver in absence of any "Detention Certificate' and that the goods were allowed to be transshipped on credit basis even though the Port Authority has lien over the goods until payment of charges. 35. I have heard learned counsel for the petitioner and the respondent. 36. The dispute herein pertains to collection of Transshipment and other charges such as demurrage for storage of containers by the custodian of the goods. 37. Demurrage is collected by the Custodian of the impo....
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....dia Ministry of Finance Department of Revenue, New Delhi Subject : Movement of Imported Cargo by Containers/Trucks from Airport/ACCs to ICDs/CFSs/Airports/ACCs - reg. I am directed to invite your attention to the subject mentioned above and to say that a number of references have been received from the trade and the Ministry of Commerce for allowing movement of imported cargo in containers/trucks from the airports/ ACCs to ICDs/CFSs/Airports/ACCs to the ICDs/CFSs/Airports/ACCs is required in view in the fact that the number of flights at most of the airports other than the gateway airports are restricted and there is loss of time involved in waiting for the cargo / passenger flights as per available schedule. 2. The matter has been examined. With a view to supplementing the existing flights and providing adequate flexibility to the trade in the choice of modes of transport, it has been felt that movement of imported cargo in containers/trucks should be allowed between airports/ACCs and airports/ACCs/CFSs/ICDs. Accordingly the following procedure is laid down for transshipment of imported cargo under bonded trucking facility from airports/ACCs to ICDs/CFSs....
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....n area so that the goods on unloading can be shifted to the transshipment warehouse without having to be moved outside the Airport area. The concerned Airlines/Custodian warehouse should have double locking arrangement, one key of which will be with the Airlines/custodian and the other with Customs, for storage of transshipment cargo. Preventive Officers will be posted at the Airlines/custodian warehouse on cost recovery basis. (vii) If the Airlines/custodian does not have a transshipment warehouse, the import cargo for transshipment duly passed with transshipment application will be received by them from the Airport Authority of India's (AAI) custody to their make-up area specially earmarked for the purpose of palletisation/containerisation on the same day under customs supervision and if for any reason the goods cannot be trannsshipped immediately, the same should be handed over to AAI. (viii) The custodian so appointed and deciding to trannsship the cargo will present transshipment application (5 copies) alongwith the copy of Airway Bill (both Master copy and House Airway Bill wherever applicable) to the Customs officer incharge of transshipment clearance. The ....
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....) The Import Freight Officer of Customs at the inland airport/ACC/CFS/ICD of destination will check the Customs Bottle Seals and description of packages as per T.P. copy. He will tally the packages with the copies of the manifest received and will ensure that the packages are in good condition. The safety and security of the packages is the responsibility of the custodian. In case of any damage at the time of in transit, it should be clearly indicated in all copies of manifest and attested by custodian. The IFO at the airport/ACC/CFS/ICD of destination after receiving the cargo shall give a suitable endorsement on the original T.P. copy. Checked Customs Bottle Seal and packages as per T.P. application No. ............ .......... dated .................... arrived on Container/Truck No. ...................... on ........................(date). Name and Signature of IFO Customs The IFO will retain the T.P. copy sent with the truck for record. (xiii) The endorsed original T.P. copy will be presented by the Airlines custodian as evidence of handling over of the cargo to the transshipment officer at the Air Cargo Complex/Airport from where the transsh....
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....y when the petitioner addressed letter dated 11.12.2009 to the 2nd respondent. 50. It is not as if the petitioner was transshipping such cargo for the 1st time through Chennai airport to Airports in Trivandrum and Calicut. If indeed there were no officers available to receive and scrutinise the application for transshipment for the reasons stated by the petitioner, obviously there will be delay in filing of transshipment application. The imported cargo therefore cannot be transhipped and would stagnate in the premises of the Airport authority of India. 51. Therefore, the query dated 14.12.2009 of the 2nd respondent asking why cargo meant for Trivandrum were routed through Chennai instead of carrying them directly to Trivandrum indicates the request of the petitioner for immediate processing of Transshipment application was perhaps intended to deflect the problem phased by the Customs. No reasons was given by the 2nd respondent. 52. Therefore, in the background of the facts which have emerged, prima facie it appears the petitioner may not have been guilty of any delay in filing transshipment application. 53. However, this would require proper verification and presentatio....
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....or clearance or removal from the Cargo Terminal or of the Customs at the Cargo Terminal. 59. During the relevant period, the cargo had to be cleared within 72 hours of its arrival. By order an dated 02.12.2016, this time has been now reduced to 48 hours by the Director, Ministry of Civil Aviation (ER Division). 60. For the purpose of Transshipment, the authority under the aforesaid Regulations relies on the relevant airlines and customs document upon its admission, handing over and delivery as the case may be for levy and collection of applicable charges. 61. Under Rule 4, the authority shall levy charges which may include unitisation and de-stuffing charges, facilitation charges, terminal storage and processing charges etc. 62. Under Regulation 6 of the Airport Authority of India (Storage and Processing of Cargo, Courier and Express Goods and Postal Mail) Regulations, 2003, the Airport Authority can lay down procedure and policy for grant of waiver demurrages charges under the regulation. Though such scheme/policy exists for grant a waiver, neither the petitioner nor the 3rd/4th respondent have filed the same before this court. 63. Under the aforesaid Regulation 6, ....
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....lities without any default on the part of the importers. (b) Where the goods have been released on caution (a regular detention certificate and not a recommendatory letter). (c) Where the goods are detained [by] the Custom House pending test report and the facility of clearance against provisional assessment has not been allowed. Such detention certificates will be issued on merits for the period for which the goods were detained for the purpose. (d) Where the goods are detained for PHO formalities, the certificate will cover the period stretching between the date of drawal of the sample by the PHO and the date of his test results, and (e) In cases where samples have been drawn from the imported consignments by the Assistant Drugs Controller for ensuring compliance with the provisions of Drugs and Cosmetics Act, 1940 and where the Assistant Drugs Controller is of the opinion that release cannot be allowed against a letter of guarantee pending tests." 8. The said public notice also states that detention certificates will not be issued in the following types of cases:- "(a)Time taken by the Custom House Laboratory for analytical/c....
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.... (1976) 3 SCC 167, the Hon'ble Supreme Court has held that the Port Trusts were under a statutory obligation to render services of various kinds in the larger public and national interest. 72. The Hon'ble Supreme Court also observed that the demurrage charges are levied in order to ensure quick clearance of the cargo from the harbour and the rates are fixed in such a way that they would make it unprofitable for the importer to use the port premises as a warehouse. In case there is congestion in the port it would affect the free movement of ships and of essential goods. Therefore, the scale of rates had to be framed in such a manner that it worked both as an incentive to the importers to remove the goods as expeditiously as possible from the transit areas and also acted as a disincentive to keep the goods in the premises of the Board for a long time, thereby increasing the demurrage charges substantially with passage of time. 73. The Court further held that the High Court there was in error in holding that the Board's power to charge demurrage was limited to cases where the goods were not removed from its premises due to some fault or negligence on the part of the importer....
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....he Authority which is its proprietor is entitled to charge the importer. That until Customs clearance, the Board or the Authority may not permit the importer to remove his goods from its premises, does not imply that it may not charge the importer for the space his goods have occupied until their clearance. *** 44. It cannot be gainsaid that, by reason of unjustified detention of his goods by the Customs Authorities, the importer is put to loss by having to pay demurrage charges for the periods of such detention. The Central Government is empowered by Section 35 of the International Airports Authority Act, 1971 and Section 111 of the Major Port Trusts Act, 1963 to issue to the Authority and the Board of Trustees, respectively, directions on questions of policy after giving them an opportunity, as far as practicable, of expressing their views. The Central Government can, if so advised, after giving to the Authority and the Board of Trustees the opportunity of expressing their views, direct them, under the aforementioned provisions, not to levy demurrage charges for periods covered by detention certificates.' 80. Hon'ble Venkatachala, J. as he was then in his concur....
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.... these Regulations apply to the Mumbai Port Trust. These Regulations have been framed under Section 157 of the Customs Act. Section 160(9) of the Customs Act clearly lays down that nothing in the Act shall affect the power of the Port Authority in a major port, as defined in the Indian Major Port Trusts Act, 1963. It is not disputed before us that the Mumbai Port Trust is a major port. 33. As already explained hereinabove, the Mumbai Port Trust has the power and authority to levy rates including demurrage as fixed by the Tariff Authority under Section 47-A of the Act. This right of the Port Trust is not affected either by the provisions of the Customs Act or by the 2009 Regulations. Section 160(9) of the Customs Act clearly lays down that the provisions of the Customs Act shall not in any manner affect the constitution and powers of any Port Authority in a major port. This will include the right of the Major Port Authority that is a Major Port Trust to levy and charge rates and demurrage. 34. [Ed.: Para 34 corrected vide Official Corrigendum No. F.3/Ed.B.J./123/2017 dated 23-32018.] As far as the 2009* Regulations are concerned, these are the Regulations ....
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....ursement from the Customs Authority. * Handling of Cargo in Customs Areas Regulation, 2009. 78. The Hon'ble Supreme Court while giving the above decision has however not considered the provisions of the Airport Authority of India (Storage and Processing of Cargo, Courier and Express Goods and Postal Mail) Regulations, 2003. Perhaps the Hon'ble Supreme Court may have come to a different conclusion if it had considered the 2003 Regulation. 79. Para 34 of the above decision has practically rendered Regulation 6 of the Handling of Cargo in Customs Area Regulations, 2009 otiose by holding that the said Regulation framed under the Customs Act was in the nature of subordinate legislation and there can be no manner of doubt that such subordinate legislation framed by the Board under the Customs Act cannot in any manner affect the power and authority of the Major Port Trust statutorily vested in it. 80. The Court thus followed its earlier decision in International Airport Authority of India vs. Grand Slam International [1995 (77) ELT 753 SC] and Trustees of Port of Madras vs. Nagavedu Lungi & Co., [1995 (80) ELT 241 SC]. 81. If one were to go by the decision of the Hon'ble Su....