TaxTMI 
TaxTMI 
2020 (2) TMI 1384
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....ons"). FACTS 2. The petitioner, M/s. J. P. Impex, is averred to be a sole proprietorship firm mainly engaging in the import of accessories for mobile phones. On 22nd April, 2019, two shipments of such alleged accessories for mobile phones were imported and the petitioner filed bills of entry no. 2933826 and 2934936, valued at Rs. 5,69,126.65 and Rs. 5,66,078.17, with duty payable assessable at Rs. 2,06,516 and Rs. 2,07,040 respectively. 3. Thereafter, on 27th April, 2019, since the goods were not cleared for home consumption, the petitioner wrote to the Deputy Commissioner of Customs - (SIIB), New Customs House, New Delhi, for grant of permission for warehousing of the goods under the bill of entry number 2934936, under Section 49 of the Customs Act,1962 (hereinafter, "the Customs Act"). 4. On 1st May, 2019, post examination conducted by the Customs - (SIIB) officers, it was found that the goods were mis-declared and found to be watches and thus the goods were seized, and Show Cause Notice was issued. 5. On 3rd May, 2019, the Deputy Director, DRI, Jaipur, wrote to the Joint Commissioner (Customs), SIIB, stating the following:....
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....aid consignments from the date of holding of these Bills of entry i.e. 22.04.2019 & 24.04.2019 resp. till the finalization of the investigation as informed by competent authority of Customs. This issues with the approval of Joint Commissioner (SIIB). Yours faithfully Sd/- Assistant Commissioner (SIIB)" (Emphasis supplied) 7. Subsequently, on 8th August,2019, the Show Cause Notice was adjudicated by the Joint Commissioner, ACC Import (SIIB) with reference to the bill of entry No. 2934936, and the duty was calculated at Rs. 23,97,489/- on predetermined assessable value of Rs. 58,75,197/- and goods were directed to be confiscated under Section 111(1) and 111(m) of Customs Act and in lieu thereof redemption fine of Rs. 6,00,000/- was provided and a penalty of Rs. 21,90,445/-was imposed and personal penalty of Rs. 2,00,000/- was imposed. 8. The petitioner avers that they, thereafter approached the cargo handler with a request to release the seized goods, which was, however, turned down by the cargo handler as the demurrage charges, averred to be in tune of Rs. 35,00,000/-, was not deposited, and since the goods were not provided to the ....
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....icial forum in respect of waiver of demurrage charges shall be settled as per the assurances given in your letter ref no.DIAL/201718/Comm-Cargo/2214 dated 13/03/2019 and in the meeting held on 13/03/2019. Further Custodian shall not claim any demurrage Charges, in compliance/of regulations 6(1) of Handling of Cargo in Customs Areas Regulations, 2009 which read as follows;- "subject to any other law for the time being in force, shall not charge any rent or demurrage on the goods seized or detained or confiscated by the Superintendent of Customs or Appraiser or Inspector of Customs or Preventive Officer or Examining Officer, as the case may be" 14. Per contra, Mr. Alok Shukla, counsel for the DCSC contends that the reliance placed by the Customs authorities as well as the petitioner on the communication dated 6th May, 2019, for waiving demurrage charges is completely misconceived. 15. Mr. Alok Shukla makes a pointed submission that the Regulation 6(1)(1) of Handling of Cargo Regulations is misconceived since, the regulation itself is subject to 'any other law for the time being in force'. 16. It is submitted that, the power of the DCSC to levy demu....
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....Port Trust v. Shri Laxmi Steels [2017 (352) E.L.T. 401 (S.C.)], to contend the petitioner was not entitled to any waiver of the demurrage charges. 22. Moreover, it is contended by the counsel for DCSC, that the petitioner has made no effort to pay any demurrage, whatsoever, and without payment of which, the goods cannot be released. 23. Ms. Anjali J. Manish, at the very least, as a secondary argument, seeks waiver of demurrage during the period of delayed filling of the counter-affidavit by respondents. ANALYSIS AND CONCLUSION 24. The issue at hand, is squarely covered by our judgement rendered on 20th December, 2019 in Global Impex v. Manager, CELBI Import Shed [MANU/DE/4351/2019]. 25. The petitioner, therein, had filed a Bill of Entry, dated 3rd May, 2019, for import of unbranded ready-made garments. A request for first check of the consignment was also made. Consequent thereupon, the consignment was, purportedly, subjected to 100% examination. However, on 6th May, 2019, the consignment was put on hold, for further examination, by the Commissioner of Customs (Preventive). Thereafter it was found that the goods were mis-decl....
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....question had been licitly, or illicitly, imported, as also the detention of the goods, by the Customs authorities, was justified or unjustified, bona fide or mala fide, are entirely irrelevant. (v) The liability to pay the demurrage is on the importer, irrespective of the justifiability, or unjustifiability, of the seizure and detention of the goods by the Customs authorities. Even in a case in which the seizure is entirely unjustified, the importer would, in the first instance, have to pay demurrage, to the custodian and, thereafter, pursue, with the Customs authorities, for obtaining reimbursement of the amount. (vi) The only exception, to the application of the above principles, is in a case in which the custodian himself is guilty of unconscionable delay, or of continuing to hold onto the goods without good reason or authority. (vii) Rates of demurrage were deliberately made prohibitive, so as to discourage importers from consigning goods to the custody of the Port Trust or other custodian, and to avoid congestion at the port." (Emphasis supplied) 28. The custodian in Global Impex [MANU/DE/4351/2019] was CELEBI, and it was obse....
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....ng of fees for such storage and processing. In exercise of the said power, the AAI notified the Airports Authority of India (Storage and Processing of Cargo, Courier and Express Goods and Postal Mail) Regulations, 2003 (hereinafter referred to as "the AAI Regulations"), which came into effect on 13th June, 2003. (v) "Cargo Handling Agency" is defined, in clause (i) of Regulation 2 of the AAI Regulations, as meaning "a person, firm or company handling cargo as an agent of the Authority or the licensee and may include the Authority". As such, Mr. Tiku points out, the AAI Regulations permitted licensing/delegation, of the function of handling of the cargo, by the AAI, to its agent. (vi) "Demurrage" is defined, in clause (n) of Regulation 2 of the AAI Regulations, as meaning "the rate or amount of charges payable to the Authority by the shipper or consignee or carrier or agent or passenger for utilizing storage facility at Cargo Terminal, for storage of cargo, goods, unaccompanied baggage, stores, courier bags, express parcels, Postal mail, etc. for extended period beyond the stipulated free storage period for clearance or removal from the Cargo Terminal o....
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....on (4), of Section 12A, of the AAI Act, reads thus: "(4) The lessee, who has been assigned any function of the Authority under sub-section (1), shall have all the powers of the Authority necessary for the performance of such functions in terms of the lease." (xiii) In exercise of the powers conferred by Section 12A of the AAI Act supra, the AAI entered into an Operation, Management and Development Agreement (hereinafter referred to as "OMDA"), on 4th April, 2006, with the Delhi International Airport Pvt. Ltd. (hereinafter referred to as "DIAL"). The said agreement has been placed on record. The agreement recites that the AAI "in the interest of the better management of the Airport ... and/or overall public interest, is desirous of granting some of its functions, being the functions of operating, maintaining, developing, designing, constructing, upgrading, modernising, financing and managing the Airport to the JVC and for this purpose to lease the premises constituting the Airport Site ... in accordance with the terms and conditions set forth herein". "JVC", it may be noted, is the acronym employed, in the OMDA, to refer to the DIAL. (xiv) Chap....
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....een the DIAL and CELEBI. The introductory paras of the said Agreement contained, inter alia, the following recitals: "WHEREAS A. The Airport Authority of India and DIAL have entered into an Operation, Management and Development Agreement dated April 4, 2006 ("OMDA") whereby AAI has granted to DIAL the exclusive right and authority during the term of the OMDA (including any renewal thereof) to operate, maintain, develop, design, construct, upgrade, modernise, finance and manage the Airport. ***** B. Pursuant to the terms of the OMDA, DIAL is, inter alia, entitled to grant concession to 3rd parties for the purpose of upgradation, modernisation, finance, operation, maintenance and management of the Cargo Terminal at the Airport. ***** E. After evaluating all the Proposals received by DIAL, DIAL accepted the proposal submitted by Celebi and issued a Letter of Award to Celebi for award of the Concession." (xvi) Chapter 2 of the Concession Agreement dealt with the exact terms of the "Grant of Concession", and Clause 2.1, thereunder, reads thus: "In consideration of the Concession Fee, License Fee, ....
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....he same for rendering the Services. 6.1.3 The Concessionaire shall, while upgrading, modernizing, financing, operating, maintaining and managing the Cargo Terminal, take into consideration and be responsible for compliance with all relevant provisions of the Applicable Laws, parameters set out in the Business Plan and obtain all such Approvals as may be necessary for the implementation of the Concession including but not limited to complying with the relevant development standards as stipulated under the OMDA." For all the aforesaid reasons, Mr. Tiku submits that the entitlement, of CELEBI, to recover demurrage charges, from the petitioner, cannot be gainsaid. 125. Mr. Tiku has also endeavoured to submit, before us, that no case, meriting waiver of demurrage, can be said to exist, in view of the waiver policy of CELEBI. He draws our attention, in this context, to clause 10.1.10 of the waiver policy, which reads thus:" "10.1.10 Demurrage charges shall not be waived where: (a) Any fine/penalty/personal penalty/warning is imposed by the Customs Authority (b) Delay arose by reason of dispute....
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....ificant principles, we would like to reiterate: a. Firstly, charging of demurrage by the CELEBI, being in terms of the concessionaire agreement, between the DIAL and CELEBI, was entered into, in terms of the OMDA. b. Secondly, the agreement was in accordance with Article 2.1 of the OMDA which, again in turn, was authorised by Section 12A of the AAI Act. c. Thirdly, this, therefore, clearly constituted, "law for the time being in force", within the meaning of the expression, as employed in Regulation 6(1)(l) of the Handling of Cargo Regulations. d. Fourthly, it is expected that the Customs authorities, shall take a reasonable amount of time while exercising their power of search, seizure and investigation, and merely this, thus, cannot lead to transference of liability to pay demurrage, to the Customs authorities. 30. Pari materia, to the CELEBI, DCSC contends, and rightly so, that the Concession agreement dated 19th November, 2009 between the DCSC and DIAL, is in pursuance of the OMDA, which is duly authorized by virtue of Section 12A of the AAI Act, and therefore, the Clause 10.10 of Regulations, 2003, clea....