2021 (8) TMI 253 - HC - Customs

Refund of amount paid as demurrage charges for the clearance of Ammonium Sulphate in Bulk - period 26.07.2014 to 05.08.2014 - HELD THAT - The initial action of the Customs Authorities demanding the certificate from RFCL was incorrect and based on the subsequent clarifications issued by the Ministry of Agriculture, the Customs Authorities released the goods. Therefore, the petitioner cannot be faulted and the detention of the goods was made by the Customs Authorities on account of certain misconception, for which the petitioner cannot be penalised. This Court is of the considered opinion that because of certain procedural delays, the petitioner was penalised. The petitioner was not at fault, in view of the fact that the detention made by the Customs Authorities was found to be wrong, which was subsequently clarified by the Ministry of Agriculture - this Court is of the opinion that the petitioner need not be penalised and they have not committed any fault or irregularity at any point of time and the procedural delays should not affect the rights of an importer and therefore, this Court is inclined to consider this writ petition. The respondents 1 and 2 are directed to refund a sum of ₹ 25,85,403/- paid by the petitioner on 05.08.2014 as demurrage charges for clearance of Ammonium Sulphate in bulk covered under the vessel M.V. Kenanga for the period of 26.07.2014 to 05.08.2014 - Petition allowed.

Summary

Issues:
Refund of demurrage charges for detained goods.

Analysis:
The petitioner sought relief for the refund of demurrage charges amounting to ?25,85,403 paid for the clearance of Ammonium Sulphate in Bulk. The petitioner, a company under the administrative control of the Department of Fertilizers, imported goods detained by Customs authorities without valid reasons. Customs sought clarifications from the Ministry of Agriculture regarding the production of a certificate from the Regional Fertilizer Control Laboratory (RFCL). The Ministry clarified that the certificate was not required for releasing the goods, leading to the release of the detained Ammonium Sulphate. The demurrage charges were imposed by the Chennai Port Trust due to the detention of goods by Customs.

The petitioner argued that they were not at fault, as the detention was based on a misconception by Customs, later clarified by the Ministry of Agriculture. The Port Trust claimed that the petitioner failed to provide the required certificate from Customs authorities, justifying the imposition of demurrage charges. The Court found that the initial demand for the RFCL certificate by Customs was incorrect, and the petitioner should not be penalized for the procedural delays caused by Customs' mistakes.

The Court held that the petitioner should not be penalized for the delays caused by Customs' incorrect actions. It was noted that the Port Trust acted as per rules but imposed demurrage charges due to the lack of a certificate from Customs. In the interest of justice, the Court directed the refund of the demurrage charges paid by the petitioner. The Court allowed the writ petition, ordering the refund of ?25,85,403 within eight weeks from the date of the order, without imposing any costs.