TaxTMI 
TaxTMI 
2023 (3) TMI 79
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....mport of various cereals, pulses, tuvar dal, red choli and other items. The respondent no.1 entered into a contract of 2500 metric tons approximately. The consideration of entire export is approximately 15 lakhs of USD out of which the petitioner received advance of 20%. 2.1. Out of 106 containers, 20 containers have already been exported from Kandla Port itself. For remaining 84 containers, the respondent handed over all the containers with the shipping agent with all the documents of the Customs Department on 23.06.2006 and 24.06.2006 and it was examined by the Customs Department and thereafter only the Customs Department granted the permission under Section 50 and the order under Section 51 of the Customs Act was passed. 2.2. The Customs Authority granted permission to ship the containers on 24.06.2006 but the vessel did not arrive at the Kandla Port and the containers continue to lie at the port for the purpose of loading the same in the vessel of respondent no.4 and 5. The petitioner acting on behalf of the Government of India, in exercise of powers conferred under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 ('The Foreign Trade Act' hereinafter) iss....
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....request was made to call for the details of such cargo whether stuffed in the container or stored in loose or lying in port area for want of shipment. 2.7. The respondent no.4 sent a letter to the respondent - M/s. Inter Mark Shipping Agencies Private Limited requesting them not to accept loading of export commodities shown as per the list till further orders in view of the notification. The respondent no.1 made several representations to various authorities and contended that the goods which are lying at Kandla Port does not cover the said notification issued by the DGFT because before issuance of the said notification, the goods were passed out of charge by the Customs Authority under Sections 50 and 51 of the Customs Act and the said notification cannot be made applicable in the case of the petitioner especially in view of para-9.12 of the Import Export Policy. 2.8. It was pointed out that no notification of General Provision Class Act in view of the judgment of the Apex Court in the matter of ITC, Bhadrachalam vs. Union of India, can be permitted. It was submitted that no reply since had been received from any authority, the respondent no.1 approached this Court challenging b....
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....1. The appellant has further questioned the decision of the learned Single Judge by saying that it failed to appreciate that as per the notification issued by the appellant under the Foreign Trade Act for framing the policy under the guidance of Union of India and national importance and the protection is granted under Section 18 of the Act and therefore, this act was done in the good faith. 3.2. The company has not come out with the clean hands and there were no prayers for the compensation or the damages at the time of Special Civil Application No. 14642 of 2006 while challenging the notification which put the ban on the export of the pulses. The same is hit by the connotation waiver and acquiesces as per one of the guiding principle enunciated in the decision of the Apex Court in Collector of Customs, Bombay vs M/s. Krishna Sales (P) Ltd. [AIR 1994 SC 1239]. 3.3. It is further the say of the appellant that merely coming out with or declaring the notification of the Union of India, would not give any right to the person concerned to claim the compensation or damages under the writ jurisdiction. The oral testament of the offices of the department and those of the petitioner com....
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....akshmi Steels and Others [(2018) 14 SCC 317] (vi) International Lease Finance Corporation vs. Union of India and Others [2019 SCC OnLine Del 7782] 6. We could notice, at the outset, that there are certain undisputed facts which have been noted by the learned Single Judge which are as follows:- 6.1. The petitioner intended to export the goods of 87 containers from Kandla Port Trust. As per the Customs Act, there was a requirement to get the clearance certificate for all 87 containers and the petitioner had followed it. This clearance certificate had been issued by the Custom Office under the provision of Sections 50 and 51 of the Customs Act before 27.06.2006. 6.2. According to the respondent no.1, the shipments were not available and therefore, the 67 containers could not be physically exported beyond the territory of India. The Division Bench of this Court as well as the Apex Court while considering the action of the respondent authority in not permitting the petitioner to load the goods and considering the applicability of the notification dated 27.06.2006 and the same to be illegal. The respondent no.1 needed to export the goods and yet, for those of the containers, it ha....
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.... shipment of goods which had already passed out of charge by the customs in the pursuance of notification issued by DGFT on 27.06.2006 and also requested certain details of such cargo whether stuffed in container or stored in loose, lying in the port area for want of shipment. The respondent no.4 also sent a letter to M/s. Inter Mark Shipping Agencies Private Limited requesting them not to accept the loading of export commodities. 6.7. The Court cannot be oblivious of the respondent no.1 having made several representations to various authorities and contending that the goods which were lying at Kandla Port would not be covered under the notification issued by the petitioner because before the issuance of the said notification, the goods were passed out of charge by the Customs Authority under Sections 50 and 51 of the Act and this notification cannot be made applicable in case of the petitioner especially in view of para-9.12 of the Import Export Policy. Much emphasis had been laid on the decision of the Apex Court in the matter of ITC, Bhadrachalam vs. Union of India and Pankan Agency vs. Union of India, however when no heed was paid, the Special Civil Application No. 14626 of 20....
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....ch he might have borne the expenses, he has a right to detain it until his dues are paid. But it is not necessary in the case in hand to examine the common law principle and the bailees lien inasmuch as the very terms of the contract and the provisions of the Bills of Lading,, unequivocally conferred power on the appellant to retain the goods, until the dues are paid. Such rights accruing in favour of the appellant cannot be nullified by issuance of a certificate of detention by the customs authorities unless for such issuance of detention certificate any provisions of the Customs Act authorises. We had not been shown any provisions of 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 may be undoubtedly true that the customs authorities might have bona fide initiated the proceedings for confiscation of the goods which however, ultimately turned out to be unsuccessful and the Court held the same to be illegal. But that by itself, would not clothe the customs authorities with the power to direct the carrier who continues to retain a lien over the imported goods, so long ....
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....nsider the uncontested facts which have already emerged even from the appeal memo. The only aspect that needs to be considered is as to whether the policy decision which otherwise the authority is entitled to, would save it from payment of the demurrage charges. 7.1. In case of International Airport Authority of India and Others vs. Grand Slam International and Others [(1995) 3 SCC 151], the question was about the demurrage for the period for which the detention certificate issued for wrongful detention of the imported goods by Customs Authorities. There was a public notice issued in 1986 by the Collector of Customs in purported exercise of power under Sections 8, 33, 34 and 45 of the Customs Act read with Rules 56, 57, 58 and 59 of the Aircraft Rule, 1920 directing the approved custodian of imported goods in Kandla Customs area i.e. International Airport Authority of India/ Central Warehousing Corporation to calculate the warehousing/storage charges by excluding the charge for the period of detention of the goods at the instance of the customs as certified by the Assistant Collector of Customs. Per majority, the notice had been held ultra vires Section 45 of the Customs Act. The....
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....eaded, the Court held that though it is true 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 period 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 Boards of Trustees the directions not to levy demurrage charges for periods covered by detention certificate, after giving them an opportunity, as far as practicable, of expressing their views. "40. In any event, the provisions of the Customs Act under which the said Customs public notice was issued may be ex- amined. Section 8 empowers the Collector of Customs to approve proper places in any Customs port of Customs airport for the unloading and loading of goods and to specify the limits of any Customs area. Section 33 debars the unloading of imported goods at any place other than a place approved under section 8. Section 34 states that imported goods shall not be unloaded from any conveyance except under the supervision of a proper officer. Section 45 reads thus: "Restrictio....
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....ity 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. 43. What is stated in the quoted clause of the said customs public notice would be effective against the Authority only if it were shown that the Authority had, expressly or impliedly, consented to such arrangement; that is not even pleaded. 44. It cannot be gain said 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 III of the Major Port Trusts Act, 1963, to issue to the Authority and the Boards of Trustees, respectively, directions on questions of policy after giving them an opportunity, as far as practicable, of expressing their views. -Me Central Government can, if so advised, after giving to the Authority and the Boards of Trustees the oppo....
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....same consignment. The Government challenged the order of the Tribunal which upheld the Collector's order. In this background when the question arose of the payment of demurrage, container charges and ground rent to Warehousing Corporation, the Court held that the goods have not been released but detained and seized by the DRI officer on the ground of fraudulent deal for further adjudication held the Corporation was entitled to recover its charges from the importer for the period from 16.01.1991 till the date of release. The Customs Authorities were not held liable for the said period. "16. The High Court has directed that the Custom Department would pay the demurrage, container charges and ground rent to the Corporation from 16th January, 1991. The said direction is contrary to the decision of this Court in International Airport Authority of India and Ors. v. Grand Slam International and Ors. The Corporation is entitled to recover its charges from the importer. Therefore, the direction in the impugned judgment and order that the custom authorities shall pay those charges is set aside. Thus, the appeal filed by the importer (CA No. 7931/95) deserves to be dismissed. In any ev....
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....es, the Court held thus: "Statutorily the respondent Board is entitled to claim payment of all demurrage charges before the goods were cleared. The appellant never offered to pay the demurrage charges. It sought to misuse the order of the court and take the goods out of the custody of the respondent without payment of the respondent's charges. The respondent was fully justified in refusing to allow such clearance. The appellate court was right in concluding that the respondent was entitled to recover all charges till the date the goods remained with it." "The proposition that the bailee, who exercises a lien, is not entitled to charge rent for storage of goods can never apply to a case where the lien is exercised for non-payment of rent or storage charges." "17. Statutorily the 1st Respondent is entitled to claim payment of all demurrage charges before the goods were cleared. The Appellants never offered to pay the demurrage charges. They sought to misuse the Order of the Court and take the goods out of the custody of the 1st Respondent without payment of their charges. The 1st Respondent was fully justified in refusing to allow such clearance. The Appellate Court was righ....
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.... clearance of goods was before the Court. Thereafter by Order dated 16th September, 1991 the High Court again permitted clearance of goods. The interim Order dated 16th November, 1991, in the Appeal filed by the 1st Respondents, also permitted clearance on furnishing a Bank Guarantee. At no stage did the Appellant inform the 1st Respondent that they were not going to furnish a Bank Guarantee. Thus the 1st Respondent could not have sold the goods. 20. Mr. Nageshwar Rao then submits that the 1st Respondent had applied to the Appellate Court for permission to sell the goods. He points out that by Order dated 10th January, 1992 it was held as follows :- ".After hearing the Counsel for the parties, it is not possible for this Court to specify as to what consequential action the Board of Trustees for the Port of Calcutta is entitled to take in view of non-furnishing of the Bank Guarantee by the writ petitioner/respondents. That course of action has to be decided by the appellant itself. However, we direct that the appeal shall appear in the list for hearing on 31.1.1992 at the top of the list subject to part-heard" 21. Mr. Nageshwar Rao submits that now the 1st Respondents could....
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....e. There was no malafide ascribed to the Customs Authority and therefore, the Board's powers to charge demurrage was erroneously held to be limited to case of fault of negligence of importer. The Court held that the importer is liable to pay demurrage charges even when the Custom Authority has detained the imported goods which detention might later be found to be unjust. "13. Two issues arise before us - (1) whether any direction could be given to the Mumbai Port Trust to waive the demurrage charges and (2) whether the liability to pay the demurrage/detention charges in respect of the imported goods could be fastened upon the DRI/Customs Authorities. 14. As far as the first issue is concerned, it would be pertinent to point out that the Mumbai Port Trust is a statutory authority created under the Major Port Trusts Act, 1963 (for short 'the Act'). A Major Port Trust is managed by the Board of Trustees appointed under Section 3 of the Act. The works and services to be provided by the Trust at the Major Ports are set out in Chapter V of the Act. Chapter V-A which was introduced with effect from 09.01.1997 provides for fixation of tariff for Major Port Trusts. The tarif....
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....y with passage of time. This Court held that the High Court 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. 24. In Board of Trustees of the Port of Bombay v. Indian Goods Supplying Co (1977) 2 SCC 649, this Court held that it was the duty of the Board to recover rates; the Board had a lien on the goods and the right to seize and detain the goods, until the rates were fully paid and to sell the goods if the rates were not paid and recover the same. It was held that certain concessions may be given taking into account the hardship of the importers, but the legality of the rates cannot be questioned. This Court went on to hold that the importer of the goods was liable to pay the demurrage charges even if the importer was not responsible for any delay, nor any fault could be attributed to the importer. 25. In Board of Trustees of the Port of Bombay v. Jai Hind Oil Mills Company (1987) 1 SCC 648, this Court noted that the provisions of the Major Port Trust, 1963 were pari materia to the acts governing the Individual Port Trusts pri....
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....vered therefor. An importer must land the imported goods at a seaport or airport. He can clear them only after completion of customs formalities. For this purpose, the seaports and airports are approved and provide storage facilities and Customs officers are accommodated therein to facilitate clearance. For the occupation by the imported goods of space in the seaport or airport, the Board or the 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. xxx xxx xxx 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....
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....e International Airport Authority to collect charges from the importer. 28. In Union of India v. R.C. Fabrics (P) Ltd. (2002) 1 SCC 71, this Court followed the law laid down in Grand Slam (supra). Thereafter, in Om Prakesh Biyani v. Board of Trustees, Port of Calcutta 2002) 3 SCC 168 this Court, after referring to Section 58 of the Major Port Trust Act, held as follows: "8. ...........Thus the charges of the 1st Respondent are to be paid before the goods are removed. The High Court seriously erred in permitting removal of the goods without payment of the port charges. To be noted that it was never disputed that the charges were payable. The 1st Respondent was not concerned with the dispute as to who had to pay the charges. It was the appellant who was interested in clearance of the goods. It was for him to have paid the charges and cleared the goods. Even if it was the appellant's case that the Customs Authorities had to pay the charges, the appellant should have first cleared the goods by paying charges due to the 1st respondent and then claimed reimbursement from the Customs Authorities." 36. The next issue which arises is whether any direction could be issued to the DRI....
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....hat the detention of the goods by the Customs Authorities was illegal and such illegal detention prevented the importer from releasing the goods. Therefore, the Customs Authorities would be bound to bear the demurrage charges in absence of any provision absolving the Customs Authority from that liability. Here the facts have grossed out. 8.3. We must also notice the fact that undoubtedly the appellant had acted as per the policy of the Government of India of not allowing the export of the goods of 87 containers from the Kandla Port Trust but while so doing, it had forgotten the fact that the clearance certificate of all the 87 containers had been given following the procedure and the same had been issued by the Customs Officers under the provision of Sections 50 and 51 of the Customs Act before 27.06.2006. It was only on account of the non-availability of the shipments that the 67 containers could not be physically exported beyond the territory of India. 8.4. The Division Bench of this Court had held the appellant's action of not permitting the loading of the goods to be illegal. There was no fault of the petitioner. He was paying the ground rent, demurrage charges of the respond....