2020 (4) TMI 358 - HC - Customs

Non-speaking order - Levy of penal demurrage charges - sufficient opportunity of being heard not provided to the petitioner - principles of natural justice - HELD THAT - From the impugned order, it is evident that it is a non speaking order. The details of (a) declaration allegedly made by the petitioner's agent with regard to the petitioner's address, (b) when such a declaration was given by the petitioner's agent and (c) date of the alleged notice sent by the respondent to the petitioner, are all not reflected in the impugned order. As seen from the counter affidavit, the case of the respondent is that the notice sent to the petitioner was returned with the endorsement left . Even though it is the case of the respondent that the address was given only by the petitioner's agent, the said communication of the agent disclosing the petitioner's address has not been reflected in the impugned order dated 06.11.2014. By a single paragraph cryptic order, without any discussion with regard to the service of notice and with regard to the liability of the petitioner to pay penal demurrage charges, the impugned order has been passed by total non application of mind and has also been passed without adhering to the directions issued by a learned single judge of this Court. This Court is of the considered view that arbitrarily without affording a fair hearing to the petitioner, the respondent has passed the impugned order confirming the levy of penal demurrage charges on the petitioner - the matter is remitted back to the respondent for fresh consideration and the respondent is directed to pass final orders after affording sufficient opportunity to the petitioner to place all their submissions - Petition allowed by way of remand.

Summary

Issues: Challenge to impugned order levying penal demurrage charges, Compliance with court directions, Address discrepancy in notice, Fair hearing to petitioner.

Analysis:
1. Challenge to Impugned Order: The petitioner filed a writ petition challenging the impugned order dated 06.11.2014, which levied penal demurrage charges of ?7,75,726. The petitioner had a dispute with the Customs Department regarding customs duty payment for imported cargo lying at Chennai Port. A previous court order directed the petitioner to approach the authorities with documentary evidence, but the respondent confirmed the demurrage charges without proper consideration. The petitioner argued that the respondent did not comply with the court's directions and did not provide a fair hearing on the matter.

2. Compliance with Court Directions: The respondent claimed that the demurrage charges were as per the rates fixed by the Chennai Port Trust and that the notice regarding the charges was sent to the correct address, as declared by the petitioner's agent. However, discrepancies were found in the addresses mentioned in the notice and the petitioner's official documents. The court noted that the impugned order was non-speaking, lacked critical details, and did not reflect the necessary information regarding the notice, address discrepancy, and compliance with court directions.

3. Address Discrepancy in Notice: The impugned order confirmed the demurrage charges without addressing the discrepancies in the addresses provided by the petitioner and mentioned in the notice. The court observed that the order lacked a detailed discussion on the service of notice and the petitioner's liability for the charges. It was evident that the order was passed without proper consideration and without adhering to the court's earlier directions, indicating a lack of application of mind by the respondent.

4. Fair Hearing to Petitioner: The court concluded that the respondent had arbitrarily confirmed the demurrage charges without giving the petitioner a fair hearing. As a result, the impugned order dated 06.11.2014 was quashed, and the matter was remitted back to the respondent for fresh consideration. The respondent was directed to provide the petitioner with a fair opportunity to present their case, including submitting documentary evidence and having a personal hearing within eight weeks from the date of the court's order.

In summary, the court found that the respondent's confirmation of penal demurrage charges lacked proper consideration and a fair hearing for the petitioner. The impugned order was quashed, and the matter was remitted back to the respondent for fresh consideration, emphasizing the importance of providing the petitioner with a fair opportunity to present their case.