2014 (4) TMI 981 - HC - Customs

Refund of demurrage charges for release of seized goods Held that - The Regulation that prohibits respondents No. 3 and 4 from recovering demurrage on detained or seized goods came into effect after the goods were seized on 15-1-2008 - The Regulation would, therefore, not apply to the present case Relying upon M/s. Dewan Steel Industries v. Union of India 2013 (9) TMI 180 - PUNJAB AND HARYANA HIGH COURT - The scope of the Regulations is wider than the Circular, as it prohibit the Customs Cargo Service Provider to charge any amount on the goods seized or detained - But since the goods were seized in the year 2008, such Regulations will not come to the rescue of the petitioner - Even the said Regulations are to determine the relationship between the service provider and the Revenue and not in respect of services availed by the importer - Relying upon International Airports Authority of India etc. v. M/s. Grand Slam International & Ors. 1995 (2) TMI 70 - SUPREME COURT OF INDIA - No merit is found in the present petition Decided against petitioner.

Summary

Issues:
1. Interpretation of Regulation 6(1) of Handling of Cargo in Customs Area Regulations, 2009 regarding demurrage charges on seized goods.
2. Applicability of the Regulation to goods seized before its notification.
3. Refund of demurrage charges paid by the petitioner.
4. Impact of previous judgments on the present case.

Analysis:
1. The petitioner sought a writ of certiorari to quash orders and refund demurrage charges on goods seized by customs authorities. The petitioner relied on Regulation 6(1) to argue against paying demurrage on seized goods. The counsel contended that respondents operating under the regulation cannot levy demurrage and must refund the amount paid during goods release.

2. The Union of India's counsel argued that the Regulation applies to the case, requiring respondents to refund demurrage charges. However, respondents' counsel pointed out that the goods were seized before the Regulation's notification, citing a Division Bench judgment that favored the respondents.

3. The Court noted that the Regulation prohibiting demurrage on seized goods came into effect after the goods were seized, hence not applicable. Citing the Division Bench judgment, the Court found no grounds to grant relief to the petitioner. The judgment highlighted the distinction between payment obligations pre and post-confiscation, emphasizing the importer's liability for demurrage charges post-adjudication.

4. Referring to precedents from the Supreme Court, the Court dismissed the petition, emphasizing the wider scope of the Regulations in determining the service provider's relationship with the Revenue, rather than services availed by the importer. The Court's decision was based on the lack of merit in the petition, leading to its dismissal.