2022 (6) TMI 787 - HC - Customs

Concession of demurrage, detention and rental charges - mis-declaration of the description of goods and and also quantity - walnut imported besides, wet dates (which was declared) - issuance of detention certificates - whether the petitioner would be entitled to seek for any waiver of demurrage or detention charges from the fourth and fifth respondents respectively in both the cases beyond 13.01.2022? - whether such claim is justifiable within the meaning of the provisions of the Customs Act as well as the two Regulations, namely 2009 Regulations and 2018 Regulations? HELD THAT - Section 49(b) makes it clear that, in case of any imported dutiable goods, entered for warehousing, the customs authorities, if they satisfied on the application of the importer that the goods cannot be removed for deposit in a warehouse within a reasonable time, the goods may be pending clearance or removal, as the case may be, permitted to be stored in a public warehouse for a period of not exceeding thirty days - Only invoking the said provision for storing the said goods, which were imported by the petitioner, in a public warehouse, the said permission order was passed by the Customs authorities on 13.01.2022. There are two Regulations, namely 2009 Regulations, called Handling of Cargo in Customs Areas Regulations, 2009 and 2018 Regulations, called Sea Cargo Manifest and Transhipment Regulations, 2018 - Under Regulation 6(1)(l), the Customs Cargo service provider like the private respondents shall not charge any rent or demurrage on the goods seized or detained or confiscated by the proper officer - Here in the case in hand, since the goods were seized and detained and if the same is put in warehouse like the warehouse of the respondents herein, they cannot charge any rent or demurrage on the goods seized. However, the definite case of the respondents 4 and 5 in both the cases as projected by them by way of counter affidavit as well as the arguments advanced by the learned respective counsel appearing for them was that, no doubt from 08.11.2021 to 13.01.2022, there was an advice by the authorities, i.e., from Customs for waiver of rent / demurrage / detention charges, however beyond 13.01.2022 absolutely there was no advice and no such advice infact could have been given by the Customs authorities beyond 13.01.2022, because of the specific proviso contained in clause 10(l) of 2018 Regulations that, beyond 60 days, such kind of waiver cannot be made, hence the petitioner is liable to pay the rent, demurrage and detention charges from 14.01.2022. Here in the case in hand, since confiscation and redemption was possible only after 11.02.2022 Order-in-Original order, thereafter if at all the petitioner wanted to take the goods, whether beyond 13.01.2022 till the petitioner approaches the fourth and fifth respondents, whether that kind of demurrages can also be waived is the question - from the point of view of the customs, beyond the waiver period that was permitted up to 13.01.2022, it was possible for the petitioner to seek for further period waiver, for which request should be made by the petitioner with the Commissioner of Customs before expiry of 30 days. Therefore this Court is of the considered view that, the claim made by the petitioner through the prayer sought for in these writ petitions are untenable, hence, it is liable to be rejected.

Summary

Issues Involved:
1. Entitlement to waiver of demurrage or detention charges beyond 13.01.2022.
2. Compliance with the Customs Act and relevant regulations (2009 and 2018 Regulations).
3. Obligations and responsibilities of the petitioner regarding mis-declaration of goods.

Issue-wise Detailed Analysis:

1. Entitlement to Waiver of Demurrage or Detention Charges Beyond 13.01.2022:
The core issue is whether the petitioner is entitled to seek waiver of demurrage or detention charges from the fourth and fifth respondents beyond 13.01.2022. The petitioner argued that the customs authorities' permission letter dated 13.01.2022 and advice notes to the respondents should exempt them from such charges. However, the respondents contended that any waiver beyond 60 days is not permissible under the regulations. The court noted that the customs authorities had provided a waiver up to 13.01.2022, and beyond this period, the petitioner did not apply for an extension within the stipulated 30 days. Therefore, the petitioner is not entitled to waiver beyond 13.01.2022.

2. Compliance with the Customs Act and Relevant Regulations (2009 and 2018 Regulations):
The court examined Section 49 of the Customs Act, which allows for the storage of imported goods in a public warehouse for up to 30 days, extendable by another 30 days by the Commissioner of Customs. The relevant regulations, Regulation 6(1)(l) of the 2009 Regulations and Regulation 10(l) of the 2018 Regulations, prevent charging rent or demurrage on goods detained by customs, but only up to a maximum of 60 days. The court found that the customs authorities had appropriately exercised their power under these provisions, but any waiver beyond 60 days is not legally permissible.

3. Obligations and Responsibilities of the Petitioner Regarding Mis-declaration of Goods:
The petitioner admitted to mis-declaration of goods and paid the revised customs duty, penalty, and redemption charges totaling Rs. 65 lakhs. The court emphasized that the petitioner must shoulder the responsibility for the mis-declaration. The customs authorities had confiscated the goods and allowed redemption after payment of the necessary charges. The court found no basis for the petitioner's claim for further waiver of charges beyond the legally permissible period.

Conclusion:
The court concluded that the petitioner's claim for waiver of demurrage or detention charges beyond 13.01.2022 is untenable and rejected the writ petitions. The court, however, allowed the petitioner to negotiate privately with the respondents for any concessions on the charges from 14.01.2022 onwards. The respondents were directed to consider such requests in light of the pending writ petitions.

Final Order:
Both writ petitions were disposed of without any order as to costs, allowing the petitioner to negotiate with the respondents for potential concessions on charges beyond the stipulated period.