2012 (9) TMI 313 - AT - Customs

Rent or demurrage charges on goods detained or confiscated - goods not kept in Bonded warehouse - Held that - As the assessee were advised to shift the goods to bonded warehouse and in compliance to it he approached the bonded warehouse but as there was no space in the bonded warehouse, same was intimated to the department - as per Notification No.26/09-Cus. (N.T.) dt. 17.3.2009 clearly explicit that if the goods are seized or detained by the proper officer, the assessee shall not be charged with any rent or demurrage on the goods. Therefore, the first appellate authority has rightly held in the impugned order that respondents are not liable to pay detention and demurrage charges - in favour of assessee.

Summary

Issues:
1. Challenge to impugned order regarding waiver of demurrage and detention charges.
2. Interpretation of Regulation 6(l) of Handling of Cargo in Customs Areas Regulations 2009.
3. Compliance with Section 49 of the Customs Act, 1962.
4. Applicability of case laws in similar situations.

Analysis:

1. The Revenue challenged the impugned order seeking waiver of demurrage and detention charges based on the delay in passing the order and the non-shift of goods to a bonded warehouse. The issue was whether the waiver was justified. The first appellate authority had noted the delay in passing the order and held that the appellants should not be forced to pay charges due to the delay caused by the department.

2. The Revenue argued that under Section 49 of the Customs Act, 1962, the goods should have been warehoused in a bonded warehouse due to prolonged adjudication, which the respondents failed to do. They cited various case laws to support their position. However, the respondents relied on Regulation 6(l) of the Handling of Cargo in Customs Areas Regulations 2009, which states that no rent or demurrage is chargeable on goods seized or detained by the proper officer. The respondents contended that the impugned order was correct as per this regulation.

3. The judge considered the submissions from both sides and analyzed Regulation 6(l) in detail. It was found that the goods in question had been seized and were needed for investigation and adjudication, falling under the purview of the regulation. The judge disagreed with the Revenue's argument regarding shifting the goods to a bonded warehouse, noting the lack of space as intimated to the department by the respondents. The judge distinguished the case laws cited by both sides based on the timing of the goods' detention and the introduction of the 2009 regulations.

4. The judge concluded that the impugned order waiving demurrage and detention charges was correct as per Notification No.26/2009-Cus. (N.T.) and Regulation 6(l). The judge upheld the first appellate authority's decision, dismissing the Revenue's appeal. The judgment highlighted the importance of not charging rent or demurrage on goods seized or detained by the proper officer, emphasizing the protection provided by the relevant regulations in such cases.