2022 (9) TMI 1354 - HC - Customs

Import of good subject to FSSAI regulations - time frame for inspection of goods - praying for levy of demurrage charges being imposed on an importer only after the grant of an NOC from FSSAI and in essence a waiver from that levy till such time as clearance is granted - the reliefs as claimed stand restricted to appropriate directions being framed for FSSAI expediting the process of inspection of imported articles and for permission being accorded to enable an importer to move the goods from a custodian warehouse to a public warehouse. HELD THAT - From the recordal of submissions of parties it is manifest that none of them question the permissibility of the movement of imported articles from a custodian warehouse to a public warehouse. It was also conceded before the Court that no provision, statutory or otherwise, prohibits such a choice being exercised by an importer. In view of the above and bearing in mind the provisions which are made in Section 49 of the 1962 Act the Court records that pending clearance of imported articles by the competent statutory authorities it would in principle be permissible for an importer to apply to the competent authority of Customs to be granted the permission to move such articles from a custodian warehouse to a public warehouse. This would thus enable the importer to move the goods out of the airport or the cargo terminal and to store the same in a public warehouse. The movement of those goods would however necessarily have to be regulated by the Customs authorities since the goods while transiting from the custodian warehouse to the public warehouse are still to be cleared for the purposes of home consumption. The imported articles of food are statutorily subject to inspection and analysis under the provisions of the Act read with the Import Regulations which have been noticed above. An importer of food articles thus cannot contend that the goods be cleared for home consumption even before they have been duly inspected by the authorities of FSSAI and a conforming report having been drawn and submitted before the authorized officer. It would be pertinent to recollect that Section 47(5) of the Act only makes provisions for the authorized officer of FSSAI to take samples of the imported articles and forward the same to the Food Analyst - it would not be prudent to prescribe or stipulate a particular timeframe within which that exercise of inspection, taking of samples and clearance is ultimately completed. This since it would be impossible for the Court to predict the vagaries of a particular situation as well as the volume of imported articles of food that may be pending for inspection at any particular point of time by FSSAI. The apprehension which has been expressed in the writ petition stands duly taken care of and laid to rest in light of the unanimous position as struck by and on behalf of respondents 1, 4, 5, 6 and 8 who had stated that the transportation of imported articles from the custodian warehouse to a public warehouse is not prohibited under the provisions of the 1962 Act. This would enable the authorities of FSSAI to inspect imported articles of food and draw samples for analysis thereof irrespective of whether the imported articles of food are stored in a custodian warehouse or a public warehouse. All that would need to be observed is that FSSAI would not refuse inspection merely on the ground that the goods are stored in a public warehouse. Petition disposed off.

Summary

Issues Involved:
1. Delay by FSSAI in granting No Objection Certificate (NOC) for clearance of imported goods.
2. Levy of demurrage charges on importers due to the delay.
3. Right of importers to move goods from custodian warehouse to a public warehouse pending clearance.
4. Compliance with statutory provisions under the Food Safety and Standards Act, 2006 and Customs Act, 1962.

Detailed Analysis:

1. Delay by FSSAI in Granting NOC:
The petitioner contended that FSSAI was obligated under Section 47(5) of the Food Safety and Standards Act, 2006 to inspect and clear imported food articles within 5 days of taking samples. However, delays by FSSAI in granting the NOC resulted in significant demurrage charges for the petitioner. The Court recognized the statutory requirement for prompt inspection and clearance but refrained from prescribing a specific timeframe due to practical considerations such as varying volumes of imports.

2. Levy of Demurrage Charges on Importers:
The petitioner sought relief from demurrage charges imposed due to delays by FSSAI. The Ministry of Civil Aviation and Airports Authority of India justified demurrage as a regulatory measure to prevent cargo congestion. However, they did not object to the storage of imported goods in public warehouses pending clearance. The Court acknowledged the regulatory nature of demurrage but noted that importers should have the option to move goods to public warehouses to mitigate such charges.

3. Right to Move Goods to Public Warehouse:
The petitioner argued that importers should be allowed to move goods from custodian warehouses to public warehouses pending FSSAI clearance. The Court examined the relevant provisions of the Customs Act, 1962, particularly Section 49, which allows temporary storage of goods in public warehouses. The Court concluded that importers have the right to apply for permission to move goods to public warehouses, and such applications should be considered by Customs authorities in accordance with the law. The Court emphasized that no statutory provision prohibits this practice.

4. Compliance with Statutory Provisions:
The Court reviewed the statutory framework governing the inspection and clearance of imported food articles, including the Food Safety and Standards (Import) Regulations, 2017. It highlighted the procedural requirements for inspection, sampling, and storage of imported goods. The Court underscored that FSSAI is obligated to inspect and clear goods with due expedition but did not impose a rigid timeframe for the completion of these processes. The Court also clarified that FSSAI should not refuse inspection based on the location of storage, whether in a custodian or public warehouse.

Conclusion:
The Court disposed of the writ petition by affirming the importers' right to move goods to public warehouses pending FSSAI clearance and recognizing the need for FSSAI to expedite inspection processes. The decision balanced regulatory requirements with practical considerations to mitigate undue financial burdens on importers due to procedural delays.