Calcutta High Court
Board Of Trustees For The Port Of ... vs Indian Rayon Corporation Ltd. And Anr. on 5 February, 1987
Equivalent citations: 1988(15)ECC325, 1987(28)ELT334(CAL)
JUDGMENT Dipak Kumar Sen, J.
1. In 1983, the Indian Rayon Corporation Limited the respondent No. 1 imported a consignment of 166 bales of Polyester Staple Fibre for home consumption which were shipped by the vessel S.S. Kunasbiri. The said goods arrived and were unloaded at the Port of Calcutta on the 12th November, 1983.
2. The respondent No. 1 engaged M/s. Chatterjee & Sons, the respondent No. 4 clearing and forwarding agents authorised by the Customs for clearing the goods and a bill of entry for the aforesaid purpose was filed on the. 16th November, 1983.
3. The Customs authorities, however, detained the goods for testing the chemical examination.
4. The Customs authorities, however, permitted the respondent No. 1 to remove the said goods from the Calcutta Port and warehouse the same under Section 49 of the Customs Act, 1962. The said goods were removed from the Calcutta Port on the 31st January, 1984 when a sum of Rs. 1,98,009.38p. was paid on account of wharf rent against a wharf rent bill issued by the Calcutta Port authorities. The goods were ultimately released by the Customs authorities on the 23rd February, 1984.
5. The respondent No. 1, thereafter, applied to the Customs authorities for a wharf rent exemption certificate as the goods had been detained under Section 17 of the Customs Act, 1962 for special examination and test for which the respondent No. 1 was not responsible.
6. Pending the issue of the wharf, rent exemption certificate the respondent No. 1 under cover of its letter dated the 23rd June, 1984 submitted a claim bill or an application for refund of wharf rent paid in respect of the said goods as aforesaid and called upon the Calcutta Port authorities to register its claim. A letter from the respondent No. 4 dated the 28th July, 1984 authorising the respondent No. 1 to receive the amount of refund against its claim bill on behalf of the clearing agent was also forwarded.
7. Subsequent thereto, the Customs authorities issued a wharf rent exemption certificate in favour of the respondent No. 1. It was recorded in the certificate, inter alia, that the said goods had been detained by the Customs authorities from the 18th November, 1983 till the 26th December, 1983 and thereafter again from the 10th January, 1984 to the 23rd February 1984 aggregating 84 days for the purpose of special examination and chemical test.
8. Under cover of its letter dated the 17th July, 1984 the respondent No. 1 forwarded to the Officer concerned of the Calcutta Port Authorities the said wharf rent exemption certificate in original, another claim bill, the wharf rent bill of Calcutta Port authorities and a fresh letter of authority from the respondent No. 4. The respondent No. 1 called upon the Calcutta Port authorities to assess its claim and refund the amount to the respondent No. 1 expeditiously.
9. The Calcutta Port authorities however kept the claim of the respondent No. 1 pending on the ground that the respondent No. 4 had failed to pay amounts due to the former on account of under-charges in respect of other transactions.
10. On the 9th April, 1986 the Officer on Special Duty (Operation and Works) of the Calcutta Port Trust issued a letter to the respondent No. 1 stating, inter alia, that as the respondent No. 4, had failed to pay the under-charge bills raised against them, therefore, the amount refundable in respect of the said goods could not be released either to the respondent No. 4 or to the respondent No. 1.
11. By this letter dated the 8th August, 1986, the Officer on Special Duty (Operation and Works) confirmed the stand of the Calcutta Port Authority and informed the respondent No. 1 that there was no valid ground to review the decision not to refund the claim.
12. On or about the 16th September, 1986 the respondent No. 1 and Ganesh Lal Mundra the respondent No. 2 moved this Court under Article 226 of the Constitution against the Board of Trustees for the Port of Calcutta, the appellant, the Union of India, the respondent No. 3 and Messrs. Chatterjee & Sons the respondent No. 4, claiming, inter alia, a writ in the nature of certiorari for quashing the decision of the appellant contained in the said letters dated the 9th April and the 8th August, 1986, a writ in the nature of mandamus calling upon the appellant to .withdraw or rescind the said two communications and to desist from giving any effect to or act on the basis or in terms thereof, to desist from withholding the claim of the respondent No. 1 for refund and to make payment of the said claim.
13. It was contended in the application of the respondent No. 1 that the appellant was all along aware that the respondent No. 4 was acting as the agents of the respondent No. 1. The respondent No. 1 effected the payment of wharf rent routed through the respondent No. 4 and refund of the excess rent paid was to be made to the respondent No. 1 through the respondent No. 4. The appellant at all material times knew or be deemed to have known that the respondent No. 4 had no right, title and interest in the said wharf rent.
14. It was contended further that the action of the appellant in not releasing the claim of the respondent No. 1 assessed and settled at Rs. 1.36 lakhs was arbitrary and unreasonable as nothing was due and owing from the respondent No. 1 to the appellant and such action was based on irrelevant and extraneous consideration. The appellant being a creature of statute had to act in accordance with law. The appellant had proceeded without authority of law and the impugned decision of the appellant violated the rights of the respondent No. 1 under the Constitution and deprived the respondent No. 1 of property without any authority of law.
15. The application was heard on affidavits without any Rule nisi being issued.
16. Shyamal Kumar Chose, the Senior Accounts Officer of the appellant, affirmed an affidavit on the 22nd November, 1,986 which was filed in opposition to the writ petition. It was alleged in the said affidavit, inter alia, that all Port charges in respect of of the said consignment of goods had been paid by the respondent No. '4 and the appellant had no privity of contract with the respondent No. 1. It was further alleged that the appellant did not enter into any transaction directly with the respondent No. 1 and the consignment in question had been delivered to the respondent No. 4. The Bill of entry in the instant case was submitted in the name of the respondent No. 4. It was contended that the respondent No. 1 had not paid the wharf rent and the appellant had no obligation to refund the wharf rent to the respondent No. 1, on the authorisation of the respondent No. 4.
17. It was alleged that a sum of Rs. 2.30 lakhs was due and payable by the respondent No. 4 to the appellant in respect of other transactions on account of other parties. Particulars of the said dues were set out in a schedule to the said affidavit. It was contended that inspite of demands, the respondent No. 4 failed and neglected to pay the said under-charge bills and adopted the special case through the respondent No. 1 who was not legally entitled to withdraw the same. The intention of the respondent No. 4 it was alleged, was to deprive the appellant of its right to adjust the said under-charge bills of other parties due and payable by the respondent No. k from the wharf rent paid by the respondent No. 4 in the instant case.
18. Ganesh Lal Mundra, the respondent No. 2, affirmed an affidavit sometime in November, 1986 which was filed in reply to the aforesaid affidavit of Shyamal Kumar Ghosh. It was, contended in the said affidavit' inter alia that the respondents. Nos. 1 and 2 were not concerned with the amounts stated to be due and payable by the respondent No. 4 to the appellant in respect of other transactions which had nothing to do with the respondent No. 1. It was contended further that the appellant was all along aware that the respondent No. 1 was the importer of the said goods and the respondent No. 4 was the clearing agent. It was alleged that the appellant had not taken any other steps against the respondent No. 4 for realisation of its alleged dues nor revoked the licence of the respondent No. 4.
19. The said application was disposed of by an order passed by the first court on the 11th December, 1986, directing the appellant to pay to the respondent No. 1 a sum of Rs. 1,36,000/- on the basis of wharf rent exemption certificate issued by the Customs authorities without issuing any no objection certificate to the respondent No. 4. The appellant was given liberty to take steps for realisation of their outstanding dues from the respondent No. 4. The order was passed subject to any other order which might have been passed in any other proceedings in this Court on the application of the respondent No. 4 against the appellant in respect of such demand.
20. The present appeal is from the said order dated the 11th December, 1986.
21. It is recorded that Union of India, the respondent No. 3 did not appear in this appeal. It is recorded further that Union of India did not also appear at the hearing of the writ petition before the first Court. At the instance of the appearing parties, the appeal was treated as in the day's list on the 29th January, 1987. Learned advocate for the respondents Nos. 1 and 2 waived service of the notice of appeal. By consent, filing of paper book was dispensed with and the undertaking given in that behalf was directed to stand discharged. The appeal and the application were heard together.
22. At the hearing, learned advocate for the appellant contended that in law and, in particular, under the Major Port Trusts Act, 1963, the respondent No. 1 had no right to claim and obtain any refund of wharf rent paid to the appellant in respect of the said consignment even if any part of the same was refundable. He submitted further that for the purpose of landing and clearing of goods in the Port, it was the clearing agent who was treated as the owner of the goods and the appellant was entitled not to entertain any other claim on the goods landed and cleared in the Port apart from that of the clearing agents.
23. Learned Advocate next submitted that huge amounts remained due and' payable by the respondent No. 4 to the appellant in respect of other transactions had by the respondent No. 4 and the under-charge bills issued by the appellant to the respondent No. 4 remained unpaid. The appellant was entitled in law to adjust its claim in respect of the said under-charge bills against the amount of refund which could be claimed by the respondent No. 4.
24. It was last submitted that, in any event, it appeared from the wharf rent exemption certificate issued by the Customs authorities that the same covered a period from the 31st January, 1984 'to the 23rd February, 1984 during which the goods in question were not in the Calcutta Port and no wharf rent had been charged or paid for the said period. There was no question of any refund of wharf rent for the said period. It was submitted that no wharf rent exemption certificate was in existence on the 31st January, 1984 when the said goods were cleared from the Port and the said goods were cleared upon payment of all wharf rents lawfully due at that time.
25. In support of his contentions, learned Advocate for the appellant drew our attention to the following sections of the Major Port Trust Act, 1963.
Section 2. Definitions .- In this Act, unless the context otherwise requires :-
(o) "owner" (i) in relation to goods, includes any consignor, consignee, shipper or agent for the sale, custody, loading or unloading of such goods.
Section 36. Power of Board to undertake certain works.- (1) Board may undertake to carry out on behalf of any person any works or services or any class of works or services, on such terms and conditions as may be agreed upon between the Board and the person concerned.
Section 42. Performance of services by Board or other person.- (2) A Board many, if so requested by the owner, take charge of the goods for the purpose of performing the service or services and shall give a receipt in such form as the Board may specify.
Section 49. Scale of rates and statement of conditions for use of property belonging to Board.- (1) Every Board shall, from time to time, also frame a scale of rates on payment of which, and a statement of conditions under which, any property- belonging to, or in the possession or occupation of, the Board, or any place within the limits of the port or the port approaches may be used for the purposes specified.
Section 58, Time for payment of rates on goods,- Rates in respect of goods to be landed shall be payable immediately on the landing of the goods and rates in respect of goods to be removed from the premises of a Board, or to be shipped for export, or to be transhipped, shall be payable before the goods are so removed or shipped or transhipped.'
26. Learned Advocate for the appellant also drew our attention to by-law 55A of the Bye-Laws promulgated under Section 127 of the Calcutta Port Act, 1890 by the Commissioners for the Port of Calcutta, which it was submitted remained in force under the subsequent Major Port Trusts Act, 1963. The relevant portion of the said By-Law is as follows :-
"55A. No clearing agent shall without obtaining a clearing agency licence from the Traffic Manager, transact any shipping clearing for forwarding business within the port area."
The Traffic Manager may if he is satisfied about the non-fulfilment of any of the terms or conditions herein contained, suspend, withdraw or revoke the clearing agency licence issued to him, and, also if necessary apply the security deposit of Rs. 500 towards the recovery of any sum due to the Commissioners in respect of any transaction done by the said clearing agent or his sircars, clerks, servants or agents...
The procedure laid down above with the exception of making a security deposit and adjustment of any under-charges due against such deposit, will also be applicable to any exporter or importer doing the shipping, clearing or forwarding of his own consignments within the port area without employing an outsider as a clearing agent."
27. Our attention was also drawn to the Scale of Rates (Schedule or Charges) notified by the authorities of the Calcutta Port Trust which provided, inter alia, as follows ;-
"Rent on goods detained in the Port by the Collector of Customs for special examination under Section 17 of the Customs Act, 1962 involving chemical/analytical test other than the ordinary process of appraisement by the Customs shall be remitted as under :
Extent of remission
(i) For the first 60 days 75% of the rent due
(ii) For the next 60 days 50% of the rent due
(iii)For the subsequent days - Nil -
The remission shall, however, be granted provided the detention in each case is certified by the Collector of Customs to be not attributable to any fault or negligence on the part of the importer."
23. Learned Advocate for the respondents Nos. 1 and 2 contended on other hand that, admittedly, the respondent No. 1 was the consignee of the said goods and had imported the same for the purpose of home consumption. There was no dispute that the respondent No. 4 had been engaged the clearing agent by the respondent No. 1 and the appellant had dealt with the respondent No. 4 as such agent of the respondent No. 1.
28. He next submitted that the said goods had been detained at the Calcutta port by the Customs authorities for the purpose of special examination and/or chemical test for assessment of duty. This was established by the wharf rent exemption certificate issued to the respondent by the Customs authorities and the appellants could not and were not entitled to dispute the same. Under the notification of the appellants prescribing the scale of rates and schedule of charges, the appellants were bound to grant exemption of wharf rent in terms of the certificate issued by the Customs authorities. It was not the case of the appellants that such exemption was not available in respect of the said goods. In fact, the exemption has been assessed and settled at Rs. 1.36 lakhs as stated in the writ petition. The same had not been denied or disputed in the affidavit filed on behalf of the appellants.
29. It was submitted that the amounts which, it is alleged, have been under-charged to the respondent No. 4 had nothing to do with the goods in the instant case. The transaction which the appellants based their claim of under-charge was in respect of other goods cleared by the respondent No. 4 on behalf of other parties. The appellants were, not entitled to realise such claim from the money deposited on behalf of the respondent No. 1 towards wharf rent in the instant case. The appellants had no right to adjust the under-charge bills on account of transactions or other parties against the claim of the respondent No. 1.
30. It was submitted that the appellants had no lien in respect of claims on account of other transactions on the goods involved in the instant case.
31. In support of his contentions learned Advocate for the respondent Nos. 1 and 2 drew our attention to Section 59 of the Major Port Trusts Act, 1963, the relevant part of which is as follows :
Section 59 : Board's lien for rates - (1) For the amount of all rates leviable by the Board under this Act in respect of goods, and for the rent due to the Board for any buildings, plintsh, stacking areas, or other premises on or in which any goods may have been placed, the Board shall have a lien on such goods, and may seize and detail the same until such rates and rents are fully paid...."
Learned Advocate for the respondent No. 4 supported the respondent No. 1.
32. From Section 2(o) of the Major Port Trusts Act, 1963, noted earlier, it appears that the definition of the word "owner" therein is only inclusive and not a comprehensive definition. In any event, a consignee is also to be considered as the owner within the meaning of the said section. In the instant case, the respondent No. 1 was admittedly the importer of the said goods. The wharf rent exemption certificate in the instant case had been issued by the Customs authorities in favour of the respondent No. 1. The title of the respondent No. 1 to the said goods has not been disputed or questioned by the respondent No. 4. The respondent No. 1 submitted its claim for refund of the wharf rent paid in excess which had been accepted by the appellant. It was stated in the claim that the wharf rent had been paid against the said wharf rent bill dated the 30th January, 1984 by the respondent No. 1.
33. In view of the aforesaid we hold that the appellant was not entitled to. challenge the locus standi of the respondent No. 1 or to contend that only the respondent No. 4 could be treated as the owner of the said goods and that payment of wharf rent in respect of the said goods had been made by the respondent No. 4 on its own account. There is nothing in the said Act of 1963, the By-laws promulgated or any other Rule or Notification precluding the actual owner of goods cleared through the Calcutta Port to prefer claims in respect of the same to the appellant. Under Section 59 of the said Act of 1963, the appellant has been given a right of lien for its. rates and rents against the goods on which such rates and rents have accrued. Such lien, in our view, cannot be extended to other goods belonging to other persons. The position would remain the same in respect of payment made on account of rent and rates paid in respect of any particular consignment. If such rates and rents have been paid in excess the appellant, in our view, cannot shift its claim in respect of other goods belonging to other parties on such excess amount paid either under the Act of 1963 or the By-laws or Rules made thereunder.
34. Even under the general law, it is not open to the appellants to adjust its claims against particular goods of particular persons against other goods belonging to other persons or against money paid by another person, in respect of such other goods. The appellant, in the instant case, was not entitled to treat the respondent No. 4 as the principal in respect of goods cleared by it and adjust its claim in respect of some goods against the dues in respect of others. Ex facie, the respondent No. 4 was the agent who acted on behalf of different principals in respect of different consignments of goods.
35. For the reasons as aforesaid, we are unable to accept the contentions of the appellants. We note that the positive averment In the writ petition that Rs. 1.36 lakhs have been assessed and settled to be the claim of the respondent No. 1 on account of wharf rent paid in excess on the basis of the wharf rent exemption certificate granted by the Customs authorities was not denied by the appellant.
36. Before us a faint dispute was raised as to the quantum of refund to be calculated on the basis of the exemption granted. The wharf rent exemption certificate granted by the Customs authorities is clear and mentions specifically the dates on which wharf rent should be exempted. The rest is a matter of arithmetical calculation to be made on the basis of the percentage of exemption allowed under the scale and rates and schedule of charges of the appellant.
37. For the reasons as above, the appeal is dismissed. We affirm the judgment and order dated the 11th December, 1986 except that we direct the appellants to refund to the respondent No. 1 the amount due to it in law on the basis of the wharf rent exemption certificate issued by the Customs authorities within two weeks of the issue of the signed copy of the operative part of this judgment. The application is also disposed of as above. All interim orders passed in the appeal are vacated.
38. The appellants would pay the costs of this appeal to the respondents Nos. 1 and 2. All parties to act on a signed copy of the operative part of this judgment.