Sahaj Impex vs Balmer Lawrie And Co. Ltd
2021 Latest Caselaw 1120 Bom

                                                                               4. as wp 10492-19.doc

R.M. AMBERKAR
(Private Secretary)

                       IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                         CIVIL APPELLATE JURISDICTION

                                  WRIT PETITION NO. 10492 OF 2019


                      Sahaj Impex                                         .. Petitioner
                                  Versus
                      Balmer Lawrie & Co Ltd & Anr.                       .. Respondents

                                                 ...................
                       Mr. Vimal Jha i/by Lex Prime Law Firm for the Petitioner
                       Mr. J.B. Mishra for Respondent No. 2
                                                   ...................

                                           CORAM        : UJJAL BHUYAN &
                                                          MILIND N. JADHAV, JJ.

DATE : JANUARY 18, 2021.

Judgment and Order (Oral) (Per : Ujjal Bhuyan, J.) :

Heard Mr. Jha, learned counsel for the petitioner

and Mr. J.B. Mishra, learned counsel for respondent No. 2.

None has appeared for respondent No. 1 though in terms of

registry's note dated 08.01.2021, respondent No.1 has been

duly served as per bailiff report dated 21.12.2020.

2. Before proceeding further, we may mention that

in this case, notice was issued as far back on 10.02.2020. In

the order dated 13.03.2020, this Court noted that though the

respondents are situated at Navi Mumbai and Raigad,

notices had not been received yet. Registry was directed to

take necessary steps to ensure service of notice.

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Subsequently, in the proceedings held on 05.11.2020, Mr.

Mishra, learned counsel appeared on behalf of respondent

No. 2 while respondent No. 1 continued to remain

unrepresented. It was made clear that if respondent No.1

had been served but continued to remain unrepresented,

Court would proceed with the hearing. On subsequent dates,

registry was directed to serve notice upon respondent No. 1

and thereafter to put up service report. It is in these

circumstances that registry put up a note on 08.01.2021

stating that as per the report of bailiff dated 21.12.2020,

respondent No. 1 was duly served.

3. By filing this petition under Article 226 of the

Constitution of India, petitioner seeks a direction to the

respondents to release the container No. TTNU9895081

containing the imported goods of the petitioner declared vide

bill of entry No. 7540462 dated 07.08.2018 without paying

rent, demurrage and other charges for re-export as per

customs order dated 28.11.2018.

4. Case of the petitioner is that it is a company

incorporated under the Companies Act, 1956 having its

registered office at Indore. It is engaged in the business of

import and export of plastic granules and regrind.

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5. It is stated that petitioner had imported plastic

regrind from Dubai under bill of entry No. 7540462 dated

07.08.2018. When the cargo reached Nhava Sheva port, it

was put on hold by the Special Investigation and Intelligence

Branch of the customs department for the purpose of

investigation. In this connection, the Special Investigation

and Intelligence Branch kept the container of the petitioner

in the container freight station of respondent No. 1 which it is

stated is the legal custodian of customs to keep the

container during inquiry or investigation. Reference has

been made to a public notice No. 26/2010 dated 02.03.2010

issued by the Commissioner of Customs (Export), Nhava

Sheva, Maharashtra whereby it was mentioned that some

Customs Cargo Service Providers including custodians of

container freight stations under the jurisdiction of Jawaharlal

Nehru Custom House (JNCH) were charging rent / demurrage

on the goods seized / detained / confiscated by the proper

officer of customs. It was pointed out that this was a violation

of Regulation 6(1)(l) of the Handling of Cargo in Customs

Areas Regulations, 2009 which stipulates that Customs

Cargo Service Providers including custodians of container

freight stations should not charge any rent or demurrage on

the goods seized or detained or confiscated by the proper

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officer. In such cases, the Customs Cargo Service Providers

should allow the goods on production of a certificate issued

by the proper officer certifying such period without charging

and collecting any rent or demurrage for such period.

Proforma of such certificate was enclosed to the public

notice. Violation of the above regulation would attract penal

action, it was cautioned.

6. Respondent No. 1 had sent two notices dated

01.09.2018 and 16.09.2018 with regard to auction of the

cargo if the consignee failed to clear the container / cargo

within 30 days period. Petitioner has stated that container

No. TTNU9895081 containing the imported cargo of the

petitioner declared vide bill of entry No. 7540462 dated

07.08.2018 is lying since 02.08.2018 with respondent No.1

which is the custodian of customs.

7. A letter dated 28.11.2018 was issued by the

Deputy Commissioner of Customs, Special Investigation and

Intelligence Branch to the Deputy Commissioner of Customs,

Group 2G, JNCH, Nhava Sheva informing the latter that the

adjudicating authority had approved re-export of the goods

imported vide bill of entry No. 7540462 dated 07.08.2018 of

the petitioner on furnishing a bond of the full value of the

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goods and bank guarantee of Rs. 4 lacs. It was mentioned

that petitioner had submitted bank guarantee of Rs. 4 lacs

and Provisional Duty (P.D.) Bond of Rs. 15,24,000.00 for re-

export of the goods. Along with the said letter, original copy

of the bank guarantee and P.D. Bond furnished by the

petitioner were enclosed.

8. Thus, petitioner had complied with the conditions

imposed in the order of the adjudicating authority for re-

export of the goods which it had imported by furnishing the

bank guarantee of Rs. 4 lacs and P.D.Bond of

Rs.15,24,000.00 which covered the assessable value of the

goods.

9. Superintendent of Customs, Special Investigation

and Intelligence Branch issued a certificate dated 31.01.2019

certifying that the goods declared by the petitioner vide bill

of entry No. 7540462 dated 07.08.2018 were detained by the

Special Investigation and Intelligence Branch for the period

from 14.08.2018 to 06.02.2019. It was clarified that the

above certificate was issued in terms of public notice No.

26/2010 dated 02.03.2010. Copies of the said certificate

were furnished amongst others to respondent No. 1.

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10. In addition to the above, petitioner has stated that

copy of the said certificate was submitted by itself on the

same day i.e on 31.01.2019 to respondent No. 1. However,

there was no response from respondent No. 1. Petitioner

sent e-mail on 05.02.2019 to which, however, respondent

No.1 replied that writ petition No. 4679 of 2010 was pending

before this Court in which a challenge has been made to

Regulation 6(1)(l) of the Handling of Cargo in Customs Areas

Regulations, 2009. The writ petition has been filed by CFS

Association of India of which respondent No. 1 is a member.

While stating that no interim order had been passed in the

said writ petition, claim of the petitioner to waiver of rent and

demurrage charges was however denied.

11. Since respondent No. 1 did not release the goods

of the petitioner and on the other hand demanded rent and

demurrage charges which was more than Rs. 17 lacs,

petitioner has filed the present writ petition seeking the relief

as indicated above.

12. Learned counsel for the petitioner has referred to

sections 45 and 141 of the Customs Act, 1962 (briefly, "the

Customs Act" hereinafter). He has also referred to the

public notice No. 26/2010 as well as Regulation 6(1) of the

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Handling of Cargo in Customs Areas Regulations, 2009. After

referring to the aforesaid provisions and the public notice, he

submits that when the customs authorities had approved re-

export of the goods with certain conditions which have been

duly complied with by the petitioner and when the customs

authorities had issued certificate dated 31.01.2019 for

waiver of rent and demurrage charges covering the period

from 14.08.2018 to 06.02.2019, there can be no justification

on the part of respondent No.1 not to release the goods of

the petitioner for re-export.

12.1. On a query by the Court, he submits that

respondent No. 1 is a Government of India enterprise.

Necessary particulars in this regard obtained from the official

website of respondent No. 1 have been placed on record.

12.2. He therefore submits that this Court may be

pleased to issue necessary direction to respondent No.1 to

forthwith release the goods of the petitioner for re-export.

13. Mr. Mishra, learned counsel for respondent No.2

has referred to the prayer portion in the writ petition and

submits that no prayer has been made by the petitioner

against the customs department, rather no grievance has

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been expressed by the petitioner against the authorities of

the customs department. According to him, dispute between

petitioner and respondent No.1 is a contractual one and,

therefore, a suit would be the proper remedy for the

petitioner.

14. Submissions made by learned counsel for the

parties have been duly considered. Also perused the

materials on record.

15. Section 45 of the Customs Act under the heading

'clearance of imported goods' deals with restrictions on

custody and removal of imported goods. Sub-section (1) says

that save as otherwise provided in any law for the time being

in force, all imported goods unloaded in a customs area shall

remain in the custody of such person as may be approved

by the Principal Commissioner of Customs or Commissioner

of Customs until they are cleared for home consumption or

are warehoused or are transhipped in accordance with the

provisions of Chapter VIII which deals with goods in transit.

15.1. As per sub-section (2), the person having custody

of any imported goods in a customs area, whether under the

provisions of sub-section (1) or under any law for the time

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being in force, shall keep a record of such goods and send a

copy thereof to the proper officer; shall not permit such

goods to be removed from the customs area or otherwise

dealt with, except under and in accordance with the

permission in writing of the proper officer or in such manner

as may be prescribed.

15.2. Sub-section (3) deals with pilferation of imported

goods in a customs area with which we are not presently

concerned.

16. Section 141 of the Customs Act says that

conveyances and goods in a customs area are subject to

control of officers of customs. As per sub-section (1), all the

conveyances and goods in a customs area shall, for the

purpose of enforcing the provisions of the Customs Act, be

subject to the control of officers of customs. Sub-section (2)

says that the imported or export goods may be received,

stored, delivered, despatched or otherwise handled in a

customs area in such manner as may be prescribed and the

responsibilities of persons engaged in the aforesaid activities

shall be such as may be prescribed.

17. Section 157 of the Customs Act provides the

general power to make regulations.

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18. In exercise of powers conferred by sub-section (2)

of section 141 read with section 157 of the Customs Act, the

Central Board of Excise and Customs (briefly "the Board"

hereinafter) have made a set of regulations called Handling

of Cargo in Customs Areas Regulations, 2009 (briefly "the

Regulations" hereinafter). Regulation 2(1)(b) defines

'Customs Cargo Services Provider" to mean any person

responsible for receipt, storage, delivery, dispatch or

otherwise handling of imported goods and export goods and

includes a custodian as referred to in section 45 of the Act

and persons as referred to in sub-section (2) of section 141

of the Act.

18.1. Regulation 6 deals with responsibilities of Customs

Cargo Service Provider. A large number of responsibilities to

be discharged by Customs Cargo Service Provider are

mentioned in Regulation 6. Relevant for the present case is

the responsibility mentioned in clause (l) which says that the

Customs Cargo Service Provider shall subject to any other

law for the time being in force, shall not charge any rent or

demurrage on the goods seized or detained or confiscated by

the Superintendent of Customs or Appraiser or Inspector of

Customs or Preventive Officer or Examining Officer, as the

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case may be.

19. It is not in dispute that respondent No. 1 is a

Customs Cargo Service Provider as defined in Regulation 2(1)

(b) of the Regulations. Being so, it is under a legal obligation

to discharge the responsibilities as mandated under

Regulation 6, more particularly in clause (l) thereof which

clearly says that a Customs Cargo Service Provider shall not

charge any rent or demurrage on the goods seized or

detained or confiscated by the Superintendent of Customs or

Appraiser or Inspector of Customs or Preventive Officer or

Examining Officer as the case may be. This position has

been clarified by the Commissioner of Customs (Export) in

the public notice dated 26/2010 with the further clarification

that Customs Cargo Service Providers shall allow the goods

on production of a certificate issued from the proper officer

certifying such period of seizure or detention or confiscation

without charging and collecting any rent or demurrage for

such period.

20. It is also not disputed that the goods imported by

the petitioner vide bill of entry No. 7540462 dated

07.08.2018 were detained by the proper officer of the

customs department for the period from 14.08.2018 to

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06.02.2019 which has been certified by the Superintendent

of Customs in the prescribed format further mentioning that

the certificate was issued as per public notice No. 26/2010

dated 02.03.2010.

21. Therefore, for the period from 14.08.2018 to

06.02.2019, respondent No. 1 is under a legal obligation not

to charge any rent or demurrage on the goods of the

petitioner or on the container in which the goods have been

stored and kept under its custody. Following the certificate

dated 31.01.2019, it was also under a legal obligation to

release the goods kept under its custody on or before

06.02.2019 to enable the petitioner to re-export the goods.

Failure to do so has not only caused prejudice to the

petitioner but would also disentitle respondent No. 1 from

claiming any rent and demurrage for the period beyond

06.02.2019 till release of the goods because such retention

of goods would be clearly unlawful being in violation of

Regulation 6(1)(l) of the Regulations and the public notice

dated 02.03.2010.

22. That being the position, we do not agree with the

submissions made by Mr. Mishra that the dispute between

petitioner and respondent No. 1 being contractual, petitioner

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should be relegated to the forum of civil court for obtaining

relief. That apart, respondent No.1 being a Government of

India enterprise has to act in a responsible manner.

Moreover, being a Customs Cargo Service Provider, it is

subject to the control of the officers of the customs

department and cannot act in defiance of the law and of

lawful directions of the customs authorities.

23. Thus having regard to the above, we direct

respondent No.1 to release the goods imported by the

petitioner vide bill of entry No. 7540462 dated 07.08.2018

kept in container No. TTNU9895081 forthwith to enable the

petitioner to re-export the same in terms of letter dated

28.11.2018 of the Deputy Commissioner of Customs, Special

Investigation and Intelligence Branch.

24. Writ petition is accordingly allowed. However,

there shall be no order as to costs.

25. This order will be digitally signed by the Private

Secretary of this Court. All concerned to act on production

by fax or email of a digitally signed copy of this order.

[ MILIND N. JADHAV, J. ] [ UJJAL BHUYAN, J. ]

Ravindra Digitally signed by Ravindra M.

           Amberkar
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M.         Date:
           2021.01.21
Amberkar   14:50:54
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