2005 (10) TMI 106 - HC - Customs

Summary

Issues Involved:

1. Liability for warehousing charges due to delay by Customs authorities.
2. Waiver of warehousing charges by Central Warehousing Corporation (C.W.C.).

Detailed Analysis:

1. Liability for Warehousing Charges Due to Delay by Customs Authorities:

The petitioner sought relief from warehousing charges incurred due to delays by the Customs authorities in finalizing the assessment of imported goods. The petitioner argued that the Customs authorities were grossly negligent at various stages, causing significant delays. The petitioner's counsel highlighted several points of negligence:
- Delay in registering the project despite the submission of necessary certificates.
- Delay in ordering the inspection of goods and further delays in submitting the examination report.
- The Customs authorities' initial refusal to accept the certificate from M/s. Superintendence Co. of India (P) Ltd., which was later accepted in the final assessment.

The Customs authorities acknowledged some delay but argued that there was no malice involved and that the liability to pay warehousing charges should not be shifted to them. They offered to issue a detention certificate to help the petitioner seek a waiver of demurrage charges from the C.W.C.

The court held that the primary liability for warehousing charges lies with the importer. The court noted that the petitioner imported goods before obtaining the necessary Project Import Certificate and failed to furnish a fresh certificate within the stipulated time. Additionally, the petitioner did not approach the court promptly to address the delays. Thus, the court did not find sufficient grounds to shift the warehousing charges to the Customs authorities.

2. Waiver of Warehousing Charges by Central Warehousing Corporation (C.W.C.):

The petitioner also sought an order directing the C.W.C. to waive the warehousing charges. The petitioner argued that the C.W.C. was negligent in handling the waiver application and failed to shift the goods to a cheaper warehouse despite requests. The C.W.C. rejected the waiver application without providing reasons and insisted on full payment of charges before shifting the goods.

The court found the C.W.C.'s handling of the waiver application and the shifting request to be grossly negligent and in violation of principles of natural justice. The court criticized the C.W.C. for not filing a reply to the petition and for breaching the court's order by shifting the goods to a different warehouse than ordered.

Court's Order:

1. The Customs authorities were directed to issue a detention certificate for the period from the filing of the bill of entry to the assessment of goods.
2. The C.W.C.'s order rejecting the waiver application was quashed, and the C.W.C. was directed to reconsider the waiver application and pass a reasoned order within six weeks.
3. If the C.W.C. declines the waiver, they must compute the warehousing charges up to December 22, 1997, considering the detention certificate.
4. Warehousing charges from December 23, 1997, to the clearance of goods should be computed at the rate applicable to the warehouse at Ambernath.
5. The liability to pay warehousing charges, if not waived, remains with the petitioner.

The petition was disposed of with these directions, and no costs were awarded.