2001 (10) TMI 109 - HC - Customs

Summary

Issues Involved:
1. Inaction and undue delay by the Customs Department in adjudication and release of goods.
2. Valuation of imported goods for customs duty purposes.
3. Compensation for demurrage and detention charges due to departmental delays.

Detailed Analysis:

1. Inaction and Undue Delay by the Customs Department:
The petitioner imported nine consignments of glassware between October and December 1999 and filed Bills of Entry for assessment and clearance. However, the goods were detained, and warehousing was only partly allowed. Despite court orders for warehousing and subsequent directives for expeditious adjudication, the Customs Department failed to complete the adjudication process. The court observed that the delay was a clear case of harassment and undue delay, emphasizing the principle that "justice delayed is justice denied." The court referenced previous cases, such as Kishan Kumar Daga v. Collector of Customs, where abnormal delays were similarly criticized.

2. Valuation of Imported Goods:
The petitioner argued that the goods should be valued similarly to those in comparable cases, citing Sub-rule (3) of Rule 5 of the Customs Valuation (Determination of Price of Imported Goods) Rules, 1988, which mandates using the lowest value found in identical transactions. The court supported this view, referencing multiple cases, including Sandip Agarwal v. Collector of Customs and Trident Television Private Limited v. Collector of Customs, which highlighted the necessity of fair and consistent valuation practices. The court directed the Customs Department to take into account comparable cases and the quantity imported by the petitioner for provisional assessment.

3. Compensation for Demurrage and Detention Charges:
Due to the delay in adjudication and release of goods, the petitioner incurred demurrage charges amounting to Rs. 30,40,855/-. The court noted that this loss was due to the Customs Department's mistakes and delays. While the court did not directly order compensation, it left the matter to the departmental authorities to take appropriate steps to address the issue and avoid further litigation.

Conclusion:
The court ordered the immediate release of the goods upon payment of customs duty based on the disclosed price in the Bills of Entry and furnishing a bank guarantee for the balance duty as per the provisional assessment. The court emphasized that the provisional value should consider comparable cases and the quantity imported by the petitioner. The Customs Department was directed to ascertain the provisional value within seven days and release the goods within three days of payment and furnishing the required guarantees. The court's observations and directions aimed to ensure fair treatment and prevent undue delays in the adjudication process.