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1991 Supreme(Del) 103

High Court Of Delhi
TRISHUL IMPEX - Appellant
Versus
UNION OF INDIA - Respondent
Civil 468 of 1991
Decided On : 02/15/1991

Advocates Appeared:
B.DUTTA, MADAN LOKUR, P.K.JAIN, R.K.Joshi

The Container Corporation of India, as the custodian of goods under Section 45 of the Customs Act, was bound to release the goods to the petitioner without payment of demurrage charges and ground rent charges. The Customs Department was liable to the Container Corporation of India for these charges.

Headnote:

CUSTOMS ACT, 1962 - SECTION 45 - DETENTION CERTIFICATE - INTERPRETATION - LIABILITY FOR DEMURRAGE CHARGES AND GROUND RENT CHARGES - CONTAINER CORPORATION OF INDIA AS CUSTODIAN UNDER SECTION 45 - DUTY TO RELEASE GOODS WITHOUT PAYMENT OF DEMURRAGE CHARGES AND GROUND RENT CHARGES - CUSTOMS DEPARTMENT LIABLE FOR PAYMENT OF DEMURRAGE CHARGES AND GROUND RENT CHARGES TO CONTAINER CORPORATION OF INDIA.

Fact of the Case:

Petitioner imported 71 cartons and presented the Bill of Entries on February 27, 1988. Customs authorities instituted an inquiry and issued a show cause notice on December 15, 1988, which was later discharged on March 15, 1990. Petitioner sought release of goods without payment of demurrage charges and issuance of a Detention Certificate from February 27, 1988, until the date of actual clearance.

Finding of the Court:

The court held that the Container Corporation of India, as the custodian of goods under Section 45 of the Customs Act, was bound to release the goods to the petitioner without payment of demurrage charges and ground rent charges. The Customs Department was liable to the Container Corporation of India for these charges.

Issues: 1. Whether the Container Corporation of India, as the custodian of goods under Section 45 of the Customs Act, was bound to release the goods to the petitioner without payment of demurrage charges and ground rent charges. 2. Whether the Customs Department was liable to the Container Corporation of India for these charges.

Ratio Decidendi: 1. The court relied on previous judgments which held that the custodian of goods under Section 45 of the Customs Act was bound by orders passed against the Customs authorities. 2. The court also noted that the detention certificate had been issued by the Customs authorities, which meant that the Inland Container Depot was bound to release the goods to the importer. 3. The court further held that the Customs Department was liable to the Container Corporation of India for the demurrage charges and ground rent charges, as it was the Customs Department that had detained the goods.

Final Decision: The court directed the Container Corporation of India to release the goods to the petitioner on submission of a revalidated delivery order and payment of demurrage charges and ground rent charges for the period prior to February 27, 1988. The goods were to be released within four days from the date of fulfillment of these conditions by the petitioner.

M. C. JAIN, J. ORDER (Oral)

( 1 ) HEARD counsel for the parties. This court by order dated November 12, 1990, allowed the petition and directed respondents 1 to 5 to release the goods without payment of demurrage charges in favour of the petitioner and also to issue a Detention Certificate in respect of these goods from February 27, 1988 when the Bill of Entries were filed until the date of actual clearance.

( 2 ) RESPONDENT No. 5 has now filed this C. M. 468/91 in which a declaration is sought that the liability of any demurrage charges and ground rent charges will have to be borne by the petitioner. The petitioner s case is that in all 71 cartons were imported and the Bill of Entries were presented on February 27. 1988 and thereafter the Customs authorities instituted an inquiry and a show cause notice was issued on December 15, 1988. Ultimately however, by order dated March 15, 1990 the Assistant Collector Customs discharged the said show cause notice. The petitioner s case is that when the show cause notice has been discharged, the petitioner has no liability for payment on demurrage charges and/or the ground rent charges. According to it, the Container Corporation of India is the custodian on behalf of the Customs authorities under Section 45c2) of the Customs Act and as such after issuance of the Detention Certificate by the Customs authorities the Inland Container Depot is under an obligation to release the goods without payment of demurrage charges and ground rent charges.

( 3 ) COUNSEL for the petitioner referred to two decisions in Support of his contention. One decision is of this Court dated July 28, 1987 in Trans Asia Carpets v. Union of India, CCP No. 97/87 (1 ). In that case this court had observed that the Bombay Port Trust as an agent of the Customs authorities was bound by the judgment of the court whereby the Customs Collector was to waive the demurrage or the detention charges and it was not open to the Bombay Port Trust to stress upon any alleged minor error in the detention certificate. It was observed that the Customs Collector had to obey the order of the court. It was necessary for the Bombay Port Trust to assist them in ensuring compliance with the order of the court. The Bombay Port Trust instead of assisting them questioned their authority and the detention certificate ordered to be issued by this court. The petitioner submitted that in the present case the Inland Container Depot is the custodian of the Customs authorities under Section 45 of the Customs Act and as such bound by any orders passed against the Customs authorities.

( 4 ) THE other judgment referred to by the learned counsel for the petition is Sri Tirupathi Plastics v. Assistant Collector of Customs and Others, (. 1990) 27 ECC 92 (Kar) (2 ). There, the goods were in the custody of the Railways. It was observed that as per notification, Notice No. 21/81 (Custom) dated August 7, 1981, Southern Railways are the approved custodian under Section 45 of the Customs Act, 1962. Reliance was placed in that case on an earlier decision in Equipment Sales Corporation v. Assistant Collector of Customs, (1990) 25 ECC 145 (3), wherein it was ruled that though there were no rules or regulations under which a detention certificate could be issued by the Department, it was by virtue of the decisions of the Courts that such detention certificates are being issued by the Customs and other authorities. It was observed in the course of the order that a demurrage waiver certificate must necessarily follow in all cases where detention certificate has been issued. The learned Judge observed that if correctly understood what the decision lays down is that when the goods are detained for whatever reason by the Customs authorizes and riven to the custody of the approved custodians of such detained good s pending adjudication of rival claims between the Department and the importer, a detention certificate or an order detaining the goods must be furnished to the impo




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