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IN THE HIGH COURT OF CALCUTTA
I.P. Mukerji, J.
Srikant Bagla - Petitioner
Versus
Commissioner of Customs & Ors. - Respondents
W.P. No. 818 of 2014
Decided On : 20-4-2015

Advocates Appeared:
For the Petitioners:Mr. Jayanta Mitra, Sr. Advocate & Advocate General, Mr. A.K. Banerjee and Mr. S.K. Faridullah, Advocates.
For the Respondent No.8:Mr. Soumya Mazumdar, Mr. Dibyendu Chatterjee and Mr. Siddhartha Roy, Advocates.
For the Respondent No.9:Mr. P.D. Mukherjee, Advocate.
For the Customs Authority :Mr. R.N. Das Sr. Advocate and Mr. T.M. Siddiqui, Advocates.

The customs is not liable for demurrage charges incurred due to the detention of goods if they had reasonable grounds to suspect that the goods were hazardous and had made diligent efforts to get the goods tested.

Headnote:

CUSTOMS ACT, 1962 - FURNACE OIL IMPORT - HAZARDOUS SUBSTANCE - DEMURRAGE CHARGES - LIABILITY OF CUSTOMS FOR DETENTION OF GOODS - LACK OF TESTING CENTERS - FAULT OF PETITIONER - NO RIGHT TO DAMAGES.

Fact of the Case:

The petitioner imported furnace oil, which was detained by customs for being hazardous. The petitioner sought to recover demurrage charges from the customs for the prolonged detention of the goods.

Finding of the Court:

The court found that the customs had reasonable grounds to suspect that the imported goods were hazardous and that they had made diligent efforts to get the goods tested. The court also found that the petitioner had contributed to the delay by not responding to the customs' offer to store the goods under Section 49 of the Customs Act, 1962, and by not depositing the charges of the National Test House.

Issues: 1. Whether the customs was liable for the demurrage charges incurred due to the detention of the goods? 2. Whether the petitioner had contributed to the delay in the clearance of the goods?

Ratio Decidendi: 1. The customs was not liable for the demurrage charges as they had reasonable grounds to suspect that the imported goods were hazardous and had made diligent efforts to get the goods tested. 2. The petitioner had contributed to the delay by not responding to the customs' offer to store the goods under Section 49 of the Customs Act, 1962, and by not depositing the charges of the National Test House.

Final Decision: The writ petition was dismissed, and the petitioner's right to establish the fault of the Customs in a properly constituted civil proceeding was kept open.

JUDGMENT :

I.P. Mukerji, J.

The writ petitioner imported a large quantity of a substance alleged to be furnace oil. This is also known as fuel oil He did so between January and March, 2013 in six containers, from Singapore, Malaysia and Australia. The first and the second arrived on 1st January, 2013. The containers were unloaded and removed to a container freight station the very next day, 2nd January, 2013. Other containers followed.

2. The goods were detained by the customs for a long period of time on the suspicion that they were hazardous. Under our law hazardous goods cannot be imported into the country. Ultimately, the goods were found to be hazardous. However, permission was given by the Indian authorities to the petitioner to re-export the goods.

3. Now, unpaid rent or demurrage charges operate as a lien on the goods. The container freight station owners will not allow the goods to be removed unless their charges for storage are met. The charges are quite substantial. The writ petitioner says that these charges are more than the value of the goods. Although, diverse prayers have been made in the writ petition, the only prayer that was seriously urged by Mr. Jayanta Mitra, learned Advocate General appearing for the writ petitioner was that the demurrage charges be borne and paid by the customs, as the goods were detained for a prolonged period for their fault.

4. Now let me elucidate on the facts.

5. Out of the six containers two arrived in the port of Kolkata on 1st January 2013 and the others by March, 2013. Four containers were shipped from Singapore one from Malaysia and one from Australia. Of the six containers, five were shipped by M/s. Arrow Chem. Pvt. Ltd, Singapore and one by Houra Resources Pvt. Ltd., Australia.

6. The customs took up the first container on 29th January, 2013 for sampling and assessment of customs duty.

7. Similarly, the second container arrived at the port on 1st January, 2013. It was removed to the container freight station on the same day. On 1st February, 2013 sampling and assessment to duty were made. In the same way, the third container arrived on 6th January, 2013. It was removed to the container freight station on 8th January, 2013. Sampling and assessment to duty were made on 1st February, 2013. Again, the fourth container arrived on 2nd February, 2013 and removed to the container freight station on 3rd February, 2013. Sampling and assessment to duty were made on 8th March, 2013. In the same manner, the fifth container arrived on 10th February, 2013 and was removed to the container freight station on 11th February, 2013. Sampling and assessment to duty were made on 9th March, 2013 and 25th March, 2013.

8. Lastly, the six container arrived on 15th March, 2013. It was removed to the container freight station on 16th March, 2013. Sampling and assessment to duty were made on 19th March, 2013.

9. The petitioner filed six bills of entry on 22nd January, 2013, 29th January, 2013, 29th January, 2013, 5th March, 2013, 5th March, 2013 and 13th March, 2013 for home clearance of the goods.

10. The alleged furnace oil was not released to the petitioner, although he wanted provisional release thereof. The respondents subjected the goods to tests on receipt of information that some unscrupulous importers were importing hazardous waste oil, importation of which was absolutely prohibited.

11. According to the affidavit-in-opposition affirmed on behalf of the customs on 29th October, 2014 the samples which were drawn from the goods were sent to the Customs House laboratory for testing. The test report dated 31st January, 2013 with reference to a part of the goods stated that the sample did not satisfy the requirement of furnace oil/fuel oil as per IS1593-1982. The Customs House laboratory recommended that the sample be sent to the Central Pollution Control Board, Kolkata, for testing.

12. Tests were carried out with regard to the rest of the goods and the report was the same. The main reason for coming to this opi



































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