2020 (10) TMI 643 - HC - Customs

Refusal to issue the Detention Certificate - waiver of Demurrage Charges - HELD THAT - We are satisfied that while the matter has been remanded back to the learned Commissioner, the demand made under the said order, on account of Detention Certificate not being issued by the Commissioner of Customs, cannot be sustained for the time being and therefore, payment thereof, in favour of the respondents 3 and 4 viz., Deputy General Manager Cargo, Airport Authority of India, Chennai, and the Assistant General Manager (F A), Airport Authority of India, Chennai, cannot arise. Such payment can be made, if, only after such reconsideration on remand, the concerned Commissioner again passes a fresh order and sustains the order against the Appellant. The said order obviously has to be passed after giving due and reasonable opportunity of hearing to the Appellant to ascertain as to whether reasons for delay in issuing the permission for transshipment was on account of fault of the officials at the Chennai Airport during the relevant period or on account of any fault of the Appellant, the custodian of the goods at the relevant point of time. The learned Commissioner is directed to decide the issue once again, as directed by the learned Single Judge, as expeditiously as possible, preferably within a period of six weeks from today - appeal disposed off.

Summary

Issues:
1. Compensation for delay in transshipment application processing.
2. Payment of demurrage charges due to delay in transshipment.

Analysis:

Issue 1: Compensation for delay in transshipment application processing
The High Court addressed the issue of compensation for the delay in processing transshipment applications. The learned Single Judge observed that if there was a breakdown in operations due to alleged arrests causing delays, the petitioner should be compensated. Referring to a Supreme Court case, the court left the issue open for the petitioner to establish the liability of the Customs Department for compensation. The court directed the petitioner to substantiate the allegations before the authorities and remitted the case back for appropriate orders within three months.

Issue 2: Payment of demurrage charges due to delay in transshipment
The appellant, M/s. Qatar Airways, filed an appeal challenging the direction to pay demurrage charges of approximately ?67 lakhs due to delays in transshipment. The delay was attributed to the unavailability of office staff at Chennai Airport to process transshipment applications caused by the arrest of customs officials. The appellant argued that the delay was beyond their control, and the Customs Authorities should verify the reasons for the delay. The High Court, after examining the records and the order of the Single Judge, held that the demand for demurrage charges cannot be sustained at the moment. The court modified the order to suspend the payment of demurrage charges until the Commissioner of Customs reconsiders the issue and passes a fresh order after providing a hearing to the appellant.

In conclusion, the High Court disposed of the appeal, expecting the Commissioner to decide on the issue expeditiously, preferably within six weeks. The court clarified that the petitioner shall not be required to pay demurrages until the Commissioner re-evaluates the situation. The writ appeal was closed without costs, along with related petitions.