2020 (8) TMI 231 - HC - Customs

Maintainability of petition - Jurisdiction - petitioner seeks adjudication of disputes - HELD THAT - In view of the fact that the petitioner has already furnished the bank guarantee equivalent to the amount claimed by the respondent authorities in terms of the demand notice dated 2nd March, 2020 and having regard to the fact that they have made written representation for waiver of cost recovery charges that is still pending with the appropriate authorities, I am inclined to pass an order by extending the custodianship of the petitioner beyond 30th June, 2020 for a period of 3 months or until the representation pending with the authorities are disposed of by a reasoned order, whichever is earlier. The Assistant Commissioner of Customs is directed to consider the representations dated 13th June, 2018 and 10th December, 2018 after giving an opportunity of hearing to the petitioner and/or their duly authorized representatives and shall dispose of the said representations in accordance with law by a reasoned order within a period of 8 (eight) weeks from the date of communication of this order by either of the parties and such order shall be communicated within 2 (two) weeks from the date of such order. Petition disposed off.

Summary

Issues:
1. Demand raised by Custom Authorities towards cost recovery charges.
2. Pending representation for waiver of cost recovery charges.
3. Extension of custodianship of the petitioner.
4. Jurisdiction of the Delhi High Court over the matter.
5. Direction to Assistant Commissioner of Customs to consider representations.

Analysis:
1. The petitioner, a certified logistics player with a CFS at Haldia Port, challenged the demand of ?4,36,91,155 by Custom Authorities for cost recovery charges. Allegations were made that the demand was raised without following proper guidelines, and despite pending representations, written demands were issued. The petitioner contended that there was no post sanction for the CFS Officers and highlighted the irregularities in officer postings.

2. The petitioner, while maintaining their rights, provided a bank guarantee for the demanded amount. The court, considering the pending representation for waiver of charges and the bank guarantee, extended the custodianship of the petitioner until the representations are disposed of or for three months, whichever is earlier. It was emphasized that custodianship will continue until the representations are resolved.

3. The respondent authorities argued that the Assistant Commissioner of Customs should handle the representations. Reference was made to a Delhi High Court order rejecting a prayer, clarifying that the rejection was due to jurisdictional issues and not the merits of the case. The court directed the Assistant Commissioner to consider the representations and dispose of them within eight weeks, providing an opportunity for a hearing.

4. In case of rejection of the representations, the court ordered that the bank guarantee should not be invoked until one week after the order of adjudication is communicated to the petitioner. The writ petition and connected application were disposed of, with directions for all parties to act on a certified copy of the order.

This judgment from the Calcutta High Court provides a detailed analysis of the issues surrounding the demand for cost recovery charges by Custom Authorities, the pending representations for waiver, the extension of custodianship, the jurisdictional aspect in light of the Delhi High Court order, and the directions for the Assistant Commissioner of Customs to handle the representations effectively.