1996 (7) TMI 145 - HC - Customs

Summary

Issues:
- Release of imported goods on mutilation
- Payment of charges to port authorities
- Dispute over demurrage and container charges
- Consideration of goods as serviceable material
- Legal procedure for release of goods on mutilation

Analysis:
The judgment revolves around the import of rags by a company from the UK and the subsequent dispute regarding the release of these goods. The company imported woollen rags which were to be considered as free importable goods. However, upon arrival at Calcutta Port, the goods were held by the authorities, leading to the company paying various charges to the port trust authorities. The company sought the release of the goods either through mutilation or in accordance with specific legal judgments.

The court considered the argument presented by the Customs Authority that the question of mutilation could not be addressed until an inspection of the goods was permitted. The Customs Authority relied on standing orders to support their position, emphasizing the need for a formal request for inspection before any actions could be taken. However, the court found that the Gujarat High Court's decision supported the company's position, indicating that goods could be released upon being rendered unserviceable through mutilation.

Further, the court referred to a Tribunal decision and highlighted the importance of determining whether the goods, after being cut into pieces, remained serviceable material. If the goods were deemed unserviceable post-mutilation, the Customs Authority should release them in accordance with the law. The court directed the Commissioner of Calcutta Customs to consider the company's application for release on mutilation within a month, taking into account relevant legal precedents and passing a reasoned order.

In conclusion, the judgment provides clear directions for the release of goods on mutilation and emphasizes the need for a proper legal procedure to be followed in such cases. The court's decision aims to ensure a fair and just resolution to the dispute, highlighting the importance of considering whether the goods remain serviceable after mutilation before releasing them.