2018 (11) TMI 1307 - HC - Customs

Release of detained empty container denied - demurrage for the period for which the container was stored at Freight Station - demand of demurrage from importer - Held that - It is well known that the container is kept in the Freight Station at the instance of the Customs. Till confiscation is over, the container will be kept along with seized materials in the Container Freight Station. If at all, rent is payable it shall be collected from importer or exporter and not from the container owner. Since, he leased out the container, he is entitled to rent for the usage of empty container and not more. He cannot be construed to be the owner of goods or the container was kept in the Container Freight Station at his instance. This Court in a similar circumstance, in M/s.Trans Asian Shipping Services (P) Ltd., 2016 (10) TMI 669 - MADRAS HIGH COURT held that the containers were detained by the Department for investigation and have been kept in the respective container freight stations, the Customs Department/Directorate of Revenue Intelligence shall also endeavour to assist the respective container freight stations for recovery of the rent due and payable. As the importer has been found guilty, they could be made liable for payment of rental dues and not the container owner. Petition allowed - decided in favor of petitioner.

Summary

Issues:
1. Detention and confiscation of cargo by respondents.
2. Refusal to release container by the fifth respondent.
3. Dispute over payment of demurrage for the container.
4. Ownership rights and responsibilities regarding the container and seized cargo.
5. Legal precedent regarding rental dues and liability of importer/exporter.

Analysis:

Issue 1: The judgment addresses the detention and confiscation of cargo by the respondents, which led to the petitioner seeking the release of their empty container after de-stuffing the cargo. The cargo, identified as Red Sanders, was seized by the respondents 2 to 4, and the container was held at the fifth respondent's Container Freight Station.

Issue 2: The fifth respondent refused to release the container unless the demurrage for the period it was stored at the Container Freight Station was paid by the petitioner. The court examined the rights of the container owner and the obligations of the importer/exporter in such situations.

Issue 3: The contention arose regarding the payment of demurrage or rent for the container during the period it was stored at the Freight Station. The court clarified that any rent due should be collected from the importer/exporter, not the container owner, as the latter is entitled to rent for the usage of the empty container only.

Issue 4: The judgment emphasized the ownership rights and responsibilities concerning the container and the seized cargo. It was established that once the confiscation process is completed, the container owner is entitled to receive the empty container after de-stuffing the cargo, without being held liable for any additional charges.

Issue 5: Legal precedent was cited to support the decision, highlighting a similar case where the importer was held liable for rental dues, not the container owner. Instructions were provided by the second and third respondents to release the container after de-stuffing the cargo, further reinforcing the petitioner's entitlement to their empty container without any additional financial obligations.

In conclusion, the Writ Petitions were allowed, directing the fifth respondent to release the containers to the petitioner after de-stuffing the cargo, with no costs incurred by the petitioner. The judgment clarified the rights and liabilities of the parties involved, ensuring the container owner's entitlement to their property without undue financial burdens.