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2017 Supreme(Del) 2614
IN THE HIGH COURT OF DELHI AT NEW DELHI
S. MURALIDHAR, PRATHIBA M. SINGH, JJ.
MUSCLES FUSION FZE - PETITIONER
Versus
THE PRINCIPAL COMMISSIONER OF CUSTOMS (IMPORT), AIR CARGO COMPLEX, NEW DELHI & ORS. - RESPONDENTS
W.P. (C) 3589 of 2017 & CM APPL. 15768 of 2017
Decided On : 02-08-2017
For the Petitioner: Ms. Anjali J. Manish
For the Respondents: Mr. Amit Bansal, Mr. Akhil Kulshreshta, Mr. Milanka Chaudhary, Mr. Sarojanand, Ms. Satakshi Sood, Mr. Rakesh Tiku, Mr. Sarul Jain
The main legal point established in the judgment is that confiscated goods, especially those containing prohibited items, cannot be re-exported without payment of demurrage/ground rent charges, as per the provisions of the Customs Act, 1962 and the Food Safety and Standards Act, 2006.
Headnote:
Demurrage Charges - Re-export of Health Products - Customs Act, 1962, Section 111(d), Food Safety and Standards Act, 2006, Section 22 - The court discussed the legality of re-exporting a consignment of health products without payment of demurrage/rent charges. The court analyzed the provisions of the Customs Act, 1962 and the Food Safety and Standards Act, 2006, and their implications on the re-export of prohibited goods. The court held that the petitioner was not entitled to re-export the goods without payment of demurrage/ground rent.
Fact of the Case:
The petitioner, a Dubai based trading company, exported a consignment of health products to Delhi. The consignment was held by the Directorate of Revenue Intelligence (DRI) and subsequently confiscated by the Additional Commissioner of Customs (Imports) under the Customs Act, 1962.
Finding of the Court:
The court found that the consignment contained prohibited goods under the Food Safety and Standards Act, 2006, and was rightly confiscated under the Customs Act, 1962. The court also held that the petitioner was not entitled to re-export the goods without payment of demurrage/ground rent charges.
Issues: The main issue was whether the petitioner could re-export the consignment without paying demurrage/rent charges owed to the cargo handling company.
Ratio Decidendi: The court's decision was based on the provisions of the Customs Act, 1962 and the Food Safety and Standards Act, 2006, which prohibited the import of certain health products. The court also relied on the precedent set by the Trip Communication Pvt. Ltd. v. Union Of India case, which established that there would be no automatic exemption of demurrage/rent charges for confiscated goods.
Final Decision: The court directed the cargo handling company to communicate the amount of demurrage/ground rent to the petitioner, and upon payment, permitted the re-export of the goods. Failure to make payment would result in the cargo handling company dealing with the goods in accordance with the law.
Prathiba M. Singh, J.
1. The short question in the present case is - Whether the Petitioner is permitted to re-export its consignment of health products without payment of demurrage/rent charges owed to the Cargo handling company?
2. The Petitioner - a Dubai based trading company, exported a consignment of health products against Airway Bill No.607-67933913 through Etihad Airways, Abu Dhabi to Delhi. According to the Petitioner, the consignment consisted of 919 cartons packed in 11 pallets weighing 4325 kg. The invoice dated 23rd April 2016, accompanying the consignment was raised on M/s. Visha Enterprises, Delhi (hereafter ‘Visha Enterprises’). Upon the arrival of the consignment in Delhi, the importer Visha Enterprises did not file any bill of entry and also did not send any remittance for such consignment.
3. On 2nd May, 2016, the Directorate of Revenue Intelligence (‘DRI’) requested the Deputy Commissioner (Import Shed) at the Indira Gandhi International (‘IGI’) Airport, New Delhi to put the consignment on hold and to examine the same in the presence of DRI officers.
4. The Petitioner sought permission from the Customs authorities to re-export the goods - which request was forwarded by the Commissioner of Customs (Import) on 25th May 2016. The DRI then sought a clarification if the process of import with respect to the said consignment was completed. This letter dated 24th June, 2016 was also sent to the importer Visha Enterprises.
5. On 22nd July, 2016, the Petitioner through its Authorised Representative (AR) requested both the DRI and the Customs authorities for grant of No Objection Certificate (‘NOC’) or permission to re-export the consignment. It is the case of the Petitioner that it continues to be the owner of the consignment, as the importer Visha Enterprises was not aware of the consignment as it had not placed an order for the said goods. The Petitioner took the stand that the consignment was sent to India by mistake. On 29th July/1st August, 2016 the DRI requested the Principal Commissioner of Customs (Import) to consider the Petitioner's plea for re-export and also ascertain the question of the importability of the said goods. The Petitioner, on 2nd August, 2016, again sought a NOC from the DRI on the ground that re-export was not being permitted without a NOC from the DRI. The Petitioner further claimed that since the imported items were health products having limited shelf life and being perishable in nature, the request may be considered at the earliest. The DRI then informed the Petitioner that the case of the Petitioner had been referred to the Principal Commissioner of Customs (Import).
6. Since no permission for re-export was granted by the authorities, the Petitioner filed W.P.(C) No.7309/2016 before this Court. In the said petition, M/s. Visha Enterprises was also impleaded vide order dated 19th August, 2016. Thereafter, the said writ petition was disposed of by this Court on 14th September, 2016 in the following terms.
“W.P.(C) No. 7309/2016
The matter is listed today as 13.09.2016 was declared holiday on account of 'Id-ul-Zuha'.
The Petitioner's grievance is that the respondents – Customs authorities are not concluding their proceedings expeditiously. It is contended that the goods were never imported but were brought for re-export purposes and that in any event the importer had in fact abandoned the goods.
The materials on record show that the respondents acted on the basis of the information by the DRI and have seized the goods.
In the circumstances, the respondents shall take steps to conclude the investigation and take appropriate follow-up action as is necessary having regard to the outcome of the investigation at the earliest convenience and preferably within four months from today.
W.P. (C) 7309/2016 stands disposed of.”
7. Pursuant to the above order, a hearing was granted to the Petitioner on 10th January, 2017. Vide order dated 13th January, 2017, the Additional Commissioner of Customs (Imports)
