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TMI Blog1996 (7) TMI 557X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner at Singapore. 2. According to the petitioner Company, in terms of the contract entered into by and between the Company and M/s. M.K. Enterprises, the Respondent No. 10 in the present writ proceedings, it raised six invoices and shipped consignments of 6 x 20 ft. containers of Electrolytic Copper Wire Rods to be off loaded at the port of Calcutta. 3. M/s. Mitsui OSK Lines Ltd., the re-shipping Company in question, issued six Bills of Lading notifying M/s. M.K. Enterprises that the goods in question had been shipped for being off loaded at the Calcutta Port. The said goods were reshipped on the Vessel, S.S. Tiger River, which arrived at the Calcutta Port on 13th May, 1993. 4. It is the case of the petitioner Company that before the arrival of the goods at the Calcutta Port, the importer, the Respondent No. 10, informed the petitioner Company that they were not in a position to take delivery of the goods. Accordingly, on 11th May, 1993, the petitioner Company requested the Shipping Lines and its Agents in India not to discharge the goods at the Calcutta Port, but to send back the same to Singapore. 5. The Agents of the Shipping Lines, the Respondent No. 9 herein, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry permission to sell the same to an Indian buyer. 10. According to the petitioner Company, inasmuch as, it did not receive any response from the Customs authorities, it filed the present writ application and by an order dated 21st February, 1994, the learned Single Judge allowed the petitioner Company to re-ship the goods to Singapore, upon its Calcutta-based Agent giving an undertaking to indemnify the respondents in the event of any loss or damage. Twelve weeks' time was given to the parties to arrange for transhipment of the goods for the purpose of re-export. The Customs authorities were also directed to issue a detention certificate to the writ petitioner Company so that it was not made liable for any demurrage charges to be paid to the Calcutta Port Trust. 11. An appeal was preferred by the Customs authorities against the said order of the learned Single Judge and on 25th August, 1994, the Appeal Court gave liberty to the petitioner Company to re-export the goods in question, subject to payment of export duty, if any. 12. In terms of the order passed by the learned Single Judge on 21st February, 1994, the Customs authorities issued a detention certificate in favour of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e re-exported with the permission of the Customs authorities. 18. It was urged that in the writ petition permission had been granted to re-export the goods and in the appeal preferred by the Customs authorities the same was affirmed, but on payment of export charges, if any. 19. It was urged further that having regard to the detention certificate issued by the Customs authorities for the period from 19th August, 1993 to 7th October, 1994, the Port Trust Authorities could not claim any port charges from the petitioner Company for the said period or for the subsequent period during which the goods had been detained on account of the stand taken and the obstruction caused by the Calcutta Port Trust Authorities, for which the petitioner Company was not responsible. 20. It was then contended that if the Port Trust Authorities had any claim for demurrage or other port charges, it could recover the same from the Customs authorities who were responsible for the detention of the goods and in respect where of directions had been given to the Customs authorities to issue a Detention certificate to the petitioner Company. 21. In support of his submissions that the petitioner Company had no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court, the Bombay and Delhi High Courts and this Court, the petitioner Company should be allowed to re-export the goods in question in terms of the order passed by the Appeal Court on 25th August, 1994, without payment of demurrage and other port charges. 24. It was lastly urged on behalf of the petitioner Company that the Ministry of Surface Transport, Government of India, had been considering the question of waiver/remission of demurrage charges in different cases? It was submitted that by a letter No. PR-14013/23/89-PG, dated 29th January, 1992, addressed to the Chairman of all major ports, the Government of India indicated the guidelines issued under Section 111 of the Major Port Trusts Act, 1963, for remission of demurrage charges and directed that necessary action should be taken to adopt the same. 25. As pointed out by Mr. Panja, according to the aforesaid Circular, each case was to be treated on its own merits and only when the port was unable to deliver the goods on time. Certain exceptions were, however, set out in the said Circular where remission could be granted. Among the exceptions indicated, one ground for grant of remission is where clearance of goods is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... day at Page 453, and in Trustees of Port of Madras v. M/s. Nagavedu Lungi & Company, reported in 1995 (4) judgments Today at Page 243. Mr. Das urged that as per the majority decision in the first case it was held that an authority even if it is the custodian of the imported goods, because of the provisions of the Customs Act, would be entitled to charge demurrage for such goods in its custody and make the importer or consignee liable for the same even for periods during which he/it was unable to clear the goods from the Customs area, due to the fault on the part of the Customs authorities or of other authorities who might have issued detention certificates owning such fault. 30. Mr. Das submitted that the said view was reiterated by the Supreme Court in the case of M/s. Nagavedu Lungi & Company (supra). 31. Mr. Das then urged that under Section 59 of the Major Port Trusts Act, 1963, the port Trust authorities had a lien over the detained goods for recovery of demurrage and other port charges, and such statutory right could not be rendered infructuous by the issuance of a detention certificate by the Customs authorities who had detained the goods. 32. In this connection, Mr. Das ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unlawfully detained the goods, had been set at rest, and the petitioner company was, therefore, bound to pay the entire demurrage and port charges before it could re-export the goods, notwithstanding the detention certificate issued by the Customs authorities to cover the period from 19th August, 1993, to 7th October, 1994. 38. Mr. Das concluded his submissions by urging that since the order of 21st February, 1994, of the learned Single Judge was of an interim nature and since in the order of the Appeal Court dated 25th August, 1994, there was no reference to payment of demurrage and other port charges, at the stage of final hearing of the writ petition, the Court could always modify the interim orders in aid of the final decision, having particular regard to the fact that such orders had been made in the absence of the Calcutta Port Trust and its authorities who stand to be deprived of their statutory dues by virtue of the said orders. 39. The basic question raised in the writ petition as to the liability of the petitioner Company to pay demurrage and port charges on account of detention of the goods in question by the Customs authorities, was considered at an interim stage and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the period of detention by the Customs authorities and thereafter. 44. While the writ petitioner Company relied on various decisions wherein the consistent view taken was that the importer/consignee should not be made liable to pay demurrage charges on account of detention of the goods by the Customs authorities for no fault on his/its part, a slightly different view has been taken by the Supreme Court in the International Airports Authority case (supra). 45. At first glance, there appears to be a significant departure in the International Airports Authority case from the views expressed by the Supreme Court in Akbar Badruddin Jiwani and Sampat Raj Dugar's case (supra), relied upon by Mr. Panja, but on a second glance it is clear that it is not so. The element of difference is with regard to fixation of liability for payment of demurrage and port charges on the basis of the Scale of Rates prepared by the Port Trust authorities under the Major Port Trusts Act, 1963. 46. In the International Airports Authority case, the Hon'ble Supreme Court referred to its earlier decision in (i) Trustees of the Port of Madras v. Aminchand Pyarelal & Ors., [1976 (1) SCR 721] (ii) The Board of Tru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the goods was not due to the negligence of the importer for which he should be held responsible, yet he cannot avoid the payment of demurrage as the rates imposed are under the authority of law, the validity of which cannot be questioned. 51. In the Jai Hind Oil Mills case, the last of the three cases referred to in the International Airports Authority case (supra), the Supreme Court was of the view that before directing the Customs authorities to issue a Detention Certificate, the Court should have issued notice to the Port Trust authorities which was vitally interested in securing its own interests as regards the demurrage charges recoverable by it under law. The Supreme Court observed that this was necessary because on the production of the Detention Certificate issued by the Customs authorities, the Port Trust was under an obligation to permit the clearance of the goods without payment of full demurrage charges. If, ultimately, the party was found to be at fault, the Port Trust authorities would have lost their lien over the goods as envisaged in Section 59 of the Major Port Trusts Act, 1963. 52. The principle which emerges from the various decisions referred to above is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioner Company to re-export the goods, subject to payment of export duty, if any. 58. The aforesaid orders were not, however, implemented since by a subsequent order passed by a learned Single Judge on the application of the Calcutta Port Trust authorities on 23rd December, 1994, the parties were directed to maintain status quo, which order was subsequently extended until further orders on 11th January, 1995. 59. Inasmuch as, the Port Trust authorities cannot be denied their statutory dues on account of demurrage and other Port Charges, what has to be seen in the facts of this case is whether the liability of the importer/consignee to pay such dues is to be shifted to the Customs authorities, since the petitioner Company was not to blame for detention of the goods in question, which fact has been resolved by the issuance of a Detention Certificate by the Customs authorities in favour of the petitioner Company to that effect. 60. A similar question came up for decision before the Hon'ble Supreme Court in Padam Kumar Agarwalla v. The Additional Collector of Customs, Calcutta, & Ors. reported in AIR 1972 SC at Page 542. Quashing the order of confiscation passed by the Customs auth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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