1988 (6) TMI 52 - HC - Customs

Issues Involved:
1. Applicability of Section 55 of the Major Port Trusts Act, 1963.
2. Legality of demurrage charges in light of Wharf Rent Exemption Certificates.
3. Timeliness and limitation of the refund claim.
4. The jurisdiction of the High Court under Article 226 for directing refunds.
5. The duty of public authorities to act fairly and justly.

Detailed Analysis:

1. Applicability of Section 55 of the Major Port Trusts Act, 1963:
The primary issue was whether Section 55 of the Major Port Trusts Act, 1963, which prescribes a six-month limitation period for refund claims of overcharges, applied to the petitioner's case. Section 55 states, "No person shall be entitled to a refund of an overcharge made by a Board unless his claim to the refund has been preferred in writing by him or on his behalf to the Board within six months from the date of payment duly supported by all relevant documents."

The petitioner contended that the demurrage charges were not "overcharges" but amounts collected without authority of law due to the Wharf Rent Exemption Certificates. The court agreed, noting that Section 55 applies to overcharges synchronizing with payment, which was not the case here. The overcharging only became apparent when the second set of exemption certificates was issued on February 3, 1986.

2. Legality of Demurrage Charges in Light of Wharf Rent Exemption Certificates:
The petitioner argued that the entire demurrage charges were illegal due to the Wharf Rent Exemption Certificates issued by Customs authorities. The court noted that according to Notification No. 412 dated August 30, 1979, issued by the Port Trust Authorities, wharf rent is still leviable at a concessional rate even if an exemption certificate is issued. The court concluded that only a part of the levy was illegal and refundable.

3. Timeliness and Limitation of the Refund Claim:
The court examined whether the refund claim was time-barred under Section 55. It determined that the right to claim refund accrued only when the second set of Wharf Rent Exemption Certificates was issued on February 3, 1986. Since the petitioner filed the refund claim on February 15, 1986, it was within the limitation period. The court emphasized that limitation could not run until the right to claim refund had accrued.

4. Jurisdiction of the High Court under Article 226 for Directing Refunds:
The court addressed whether it could direct refunds under Article 226 of the Constitution. It referred to the Supreme Court's decisions, which allow courts to direct refunds where money has been collected without authority of law. The court held that the petitioner's claim was just and not barred by limitation, thus warranting a refund.

5. Duty of Public Authorities to Act Fairly and Justly:
The court criticized the public authorities for relying on technical pleas to defeat legitimate claims. It cited the Supreme Court's stance that governments and public authorities should not rely on technicalities to deny fair and just claims. The court emphasized that the Customs authorities' delay in issuing the exemption certificates should not prejudice the petitioner's right to a refund.

Conclusion:
The court allowed the petition, directing the respondent to determine and refund the amount due to the petitioner based on the Wharf Rent Exemption Certificates. The refund was to be calculated for the period from November 28, 1984, to March 25, 1985, within two weeks of the order. The court emphasized the duty of public authorities to act fairly and justly, rejecting the claim solely on the ground of limitation. There was no order as to costs.

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