2022 (4) TMI 920 - HC - Customs

Seeking release of detained goods - seeking waiver of detention charges and other charges - HELD THAT - The statutory regulations clearly provide for waiver of these charges which the petitioner cannot be compelled to pay. In the instant case the CFS/Shipping Line have not complied with the requirements that they are to fulfil pursuant to issuance of detention certificate. The question would be is the respondent/department powerless or can it be said that they will be a mute spectator to the non-compliance of their directions by the CFS/Shipping Line. The answer to this question lies in 2018 2019 Regulations wherein under Regulation 11 provides for action being taken for suspension of operations or revocation of registration of an authorised carrier. In the 2019 Regulations under Regulation 11 similar power has been provided. It is not for this Court to inform the respondent/department as to what the powers are under the statutory regulations. It is found that CFS and the shipping line are not parties to this application - liberty granted to the petitioner to take appropriate steps in this regard - List this matter on 11th March, 2022.

Summary

Issues:
1. Compliance with court directions regarding release of goods and detention certificate issuance.
2. Dispute over payment of demurrage and other charges by the petitioner.
3. Interpretation of contractual relationship between petitioner and container freight station/shipping liner.
4. Applicability of statutory regulations on waiver of charges.
5. Authority of the department to enforce compliance with regulations.

Analysis:
1. The High Court issued directions for the release of goods and issuance of a detention certificate. The department complied with the release order based on a test report. However, the detention certificate was issued for the entire detention period till goods release, but the petitioner faced challenges in clearing the goods due to demands for demurrage and other charges by the CFS/Shipping Line.

2. The revenue argued that the dispute between the petitioner and the CFS/Shipping Line is contractual, relying on precedents like Mumbai Port Trust and J.J. Polyplast Pvt. Ltd. The Court distinguished these cases, emphasizing that the statutory Sea Cargo Manifest and Transhipment Regulations, 2018 bind both the department and license holders, prohibiting container detention charges and rent/demurrage on goods seized by Customs Authorities.

3. The Court highlighted Regulation 11 of the 2018-2019 Regulations, empowering the department to suspend operations or revoke registration of carriers for non-compliance. It rejected the notion that the dispute is purely contractual, emphasizing the department's authority to enforce regulatory compliance.

4. The Court noted that the CFS and shipping line were not parties to the application, granting the petitioner liberty to take appropriate steps. It urged the department to resolve the issues, warning of adverse inferences and stringent orders if compliance is not ensured.

5. The matter was listed for further hearing on 11th March 2022, maintaining pressure on the department to address the non-compliance issues promptly to avoid contempt proceedings.