2012 (7) TMI 448 - AT - Customs

Waiver of the demurrage and detention charges - confiscated the goods for the contraventions of misbranding and adulteration under the Prevention of Food Adulteration Act, 1954 - goods are prohibited for importation into India - consignments to be re-exported on payment of redemption fine and penalty Held that - Demurrage charges and other incidental charges for goods detained in the customs area are required to be paid by the exporter consignor even if such goods were illegally detained - delay in redemption and re-export till date has been entirely caused on account of the appellants filing appeals first before the lower appellate authority and then before the Tribunal against assessee

Summary

Issues:
1. Confiscation of impugned goods for misbranding and adulteration under the Prevention of Food Adulteration Act, 1954.
2. Appeal for waiver of demurrage and detention charges.
3. Applicability of Regulation 6(1) of the Handling of Cargo in Customs Areas Regulations, 2009.
4. Interpretation of Section 126 of the Customs Act, 1962.
5. Liability for demurrage and detention charges based on Supreme Court judgments.
6. Delay in redemption and re-export of impugned goods.

Analysis:

1. The adjudicating authority confiscated the impugned goods due to misbranding and adulteration under the Prevention of Food Adulteration Act, 1954, stating they are prohibited for importation into India. The goods were allowed to be re-exported upon payment of redemption fine and penalty, a decision not challenged by the appellants. An appeal was made for waiver of demurrage and detention charges, which was rejected by the lower appellate authority citing Supreme Court judgments.

2. The advocate for the appellants argued that demurrage and detention charges should be waived under Regulation 6(1) of the Handling of Cargo in Customs Areas Regulations, 2009. However, the contention was rejected as the regulation only outlines the responsibilities of Customs cargo service providers without mandating the Customs authorities to bear such charges.

3. The appellants further contended that under Section 126 of the Customs Act, 1962, the confiscated cargo vests with the Central Government, thus the Customs department should bear the charges. This argument was deemed unacceptable as Section 126 only states the vesting of goods with the government post-confiscation, which was not applicable in this case due to the redemption and re-export orders.

4. The lower appellate authority's reliance on Supreme Court judgments was upheld, emphasizing that importers are liable for demurrage charges even if goods are detained without their fault. The detention of impugned goods due to contravention of laws led to the decision that Customs authorities are not responsible for demurrage and detention charges.

5. The delay in redeeming and re-exporting the goods was attributed to the appellants filing appeals, increasing their demurrage burden. The Tribunal dismissed all appeals, urging the appellants to expedite the process to avoid further charges. The decision was pronounced on 7.6.2012.