Monika India vs Union of India (UOI)

Adarsh Kumar Goel, J.—This writ petition seeks mandamus to the Collector of Customs to direct the Punjab State Warehousing Corporation and M/s. Samrat Shipping Co. (P) Ltd., Respondents No. 4 and 5, to waive the demurrage charges or for direction to pay to the Petitioner a sum of Rs. 2,09,704/-, recovered from the Petitioner by Respondents No. 4 and 5.

Case of the Petitioner is that it had import licence and it imported Polyester Fibre Prime Commercial Quality and Synthetic Waste Polyester. The said goods were shipped vide Bills of levy dated 15-4-1990 and 25-4-1990 by a Taiwan supplier. The goods having arrived at inland container depot at Ludhiana, the Petitioner filed a Bill of Entry dated 16-7-1990. However, on account of wrongful action of the Customs authorities, the clearance took place only on 13-9-1990, during which period, the goods remained stored with Respondents No. 4 and 5. Even though the Customs Department issued detention certificate, Annexure P-5, dated 14-9-1990, Respondents No. 4 and 5 recovered the demurrage charges. In these circumstances, the Petitioner was entitled to refund of demurrage charges.

In the reply filed on behalf of the Customs Department, stand taken is that delay in clearance of goods was attributable to the Petitioner itself. Initially, the goods were declared to be synthetic waste, later, the declaration was changed to polyester waste. The earlier declaration not being covered under notification dated 20-3-1990, the matter had to be referred for clarification after declaration of the Petitioner that the goods were polyester tow waste. After clarification, the goods were cleared. Though the detention certificate was issued, the same did not automatically entitle the Petitioner to waiver of demurrage charges. Same is the stand taken on behalf of Respondent No. 5.

Question for consideration is whether the Petitioner was entitled to waiver of demurrage charges in the facts and circumstances of the present case.

There is no doubt that there is obligation of the customs authorities to promptly take a decision on clearance of goods or to disallow clearance where the goods are prohibited goods where duty due was not paid. Even so, a warehouse is not under an obligation to waive charges, as may be liable under a contract. In an appropriate case for wrongful action of delaying clearance of goods, the customs department may be liable for damages, but this cannot be a ground by itself to waive demurrage charges payable under a contract to a warehouse. The matter was examined by the Hon''ble Supreme Court in several judgments including in International Airports Authority of India and Others Vs. Grand Slam International and Others, and Trustees of the Port of Madras through its Chairman Vs. M/s. K.P.V. Sheikh of Mohd. Rowther and Co. Pvt. Ltd. and another, and it was held that relationship between importer and the warehouse was governed by the contract, which is not nullified merely by issuance of detention certificate by the customs authorities. The customs authorities had no jurisdiction to compel a warehouse not to charge demurrage charges. This view was reiterated in Shipping Corpn of India Ltd. Vs. C.L. Jain Woolen Mills and Others, .

In view of above, the prayer for waiving the demurrage charges cannot be accepted. As regards the claim of damages against the customs department, this may require adjudication of disputed questions of fact, for which writ is not a proper remedy.

Accordingly, the writ petition Petitioner against the Customs Department in any other appropriate proceedings.