Gujarat High Court
Transnational Shipping India Pvt. Ltd vs Union Of India on 3 March, 2022
Author: J.B.Pardiwala
Bench: J.B.Pardiwala
C/SCA/17185/2021 ORDER DATED: 03/03/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 17185 of 2021
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TRANSNATIONAL SHIPPING INDIA PVT. LTD.
Versus
UNION OF INDIA
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Appearance:
PANKEET P AUNDHIYA(9421) for the Petitioner(s) No. 1
MR JINESH H KAPADIA(5601) for the Respondent(s) No. 3
MR NIKUNT K RAVAL(5558) for the Respondent(s) No. 2
MR SAVAN N PANDYA(5600) for the Respondent(s) No. 3
NOTICE UNSERVED for the Respondent(s) No. 1,4
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CORAM:HONOURABLE MR. JUSTICE J.B.PARDIWALA
and
HONOURABLE MS. JUSTICE NISHA M. THAKORE
Date : 03/03/2022
ORAL ORDER
(PER : HONOURABLE MS. JUSTICE NISHA M. THAKORE)
1. The writ applicant has approached this Court invoking extra-ordinary writ jurisdiction under Article 226 of the Constitution of India and has prayed for the issuance of writ of mandamus directing the respondent nos.2 and 3 herein to de- stuff the cargo from the containers and return the empty containers to the writ applicant. The writ applicant has also prayed for the direction to the respondents nos.2 and 3 to collect the CFS/demurrage charges and other statutory charges, if any, under the provisions of Customs Act, 1962 (in short 'the Act') to be recovered from the respondent no.4.
2. The brief facts, which emerges from the record, are summarized as under:
Page 1 of 8 Downloaded on : Sat Dec 24 12:06:39 IST 2022C/SCA/17185/2021 ORDER DATED: 03/03/2022 2.1 The writ applicant is a company registered under the
Companies Act, 1956 and is engaged in the business of Sea freight, Air freight, Container freight and other similar business relating to Maritime and Logistics Industry. It is the case of the writ applicant that the respondent no.4 herein had imported a cargo declared to be "fuel oil" which was stuffed in the 10 containers of the writ applicant bearing Nos.DRYU2395978, DRYU2396146, DRYU2403749, ESPU2048281, FCIU3890778, GCIU2054666, HJCU8360330, IALU8226491, ILCU5050657 and UESU2382410 from the Port of Shuwaikh, Kuwait to the Port of Mundra, India, vide bill of lading No.TNSSWKMUN20011 dated 14.03.2020 issued by the writ applicant.
2.2 The shipment reached at the Port of Mundra on 03.04.2020 and the cargo was discharged on the same day i.e. 03.04.2020. The arrival notice was given to the consignee - respondent no.4. In the meanwhile, the containers carrying the goods were moved to the designated CFS by the CFS Authorities - respondent no.3 herein. However, the consignee - respondent no.4 herein till date has not approached the writ applicant for taking delivery of the cargo nor has issued any abandonment letter. In such circumstances, since 03.04.2020, the containers are at CFS lying un-cleared on account of inaction of the respondent no.4 in de-stuffing the containers and clearing the cargo.
2.3 It is the case of the writ applicant that vide communication dated 15.07.2020, the writ applicant had called upon respondent no.4 to take delivery of their shipment and to de-stuff and release their empty containers. The respondent no.4 was also put to notice that in case of any further delay in Page 2 of 8 Downloaded on : Sat Dec 24 12:06:39 IST 2022 C/SCA/17185/2021 ORDER DATED: 03/03/2022 de-stuffing and release of the containers, storage detention and other statutory charges which may get accrued, would be subjected to the sole liability of the respondent no.4 herein. In spite of such final reminder notice to unclear the shipment being addressed to the respondent no.4, the containers were neither de-stuffed or released by the respondent no.4.
2.4 It further appears from the record that even a final notice dated 18.08.2020, under Section 48 of the Act, came to be issued by the respondent no.3 to clear the said cargo within a period of ten days of the issuance of such notice failing which the respondent no.3 intended to proceed for auction of such un-cleared goods. By such final notice respondent no.3 herein had cautioned respondent no.4 about payment of custom duties and other statutory dues/expenditures as may be accrued including warehousing charges etc. may be the amount realized as sale proceeds by way of auction of subjected cargo.
2.4 On the other hand, the writ applicant had approached the respondents herein vide letter dated 01.03.2021 thereby requesting to de-stuff the cargo from the aforesaid containers and return the empty containers to the writ applicant as the writ applicant company being engaged in the freight business was incurring heavy financial loss. However, the respondents herein failed to respond to such representation and hence, the writ applicant is here before this Court.
3. This Court upon hearing Mr. Pankeet Aundhiya, the learned counsel appearing for the writ applicant, vide oral order dated 25.11.2021 had issued notice for final disposal. In Page 3 of 8 Downloaded on : Sat Dec 24 12:06:39 IST 2022 C/SCA/17185/2021 ORDER DATED: 03/03/2022 response to such notice of this Court, Mr. Jinesh Kapadia, the learned counsel has entered his appearance on behalf of the respondent no.3 herein and has filed affidavit-in-reply through the Vice President of TG Terminals Pvt. Ltd., Kachchh. Mr. Nikunt Raval, the learned Senior Standing Counsel appearing for the department has appeared for respondent no.1 and 2.
4. The principal grievance of the writ applicant is that the vessel of the ownership of the writ applicant had arrived at Mundra Port on 03.04.2020 carrying ten containers filled with cargo declared to be "fuel oil" in specialized containers referred to as "flexi bags", which on account of failure of respondent no.4 - original importer/consignee, are lying in custom bonded area under the possession and supervision of respondent no.3 - CFS agent. Mr. Pankeet Aundhiya, the learned counsel for the writ applicant has submitted that the said containers of the writ applicant are blocked for no fault on part of the writ applicant as it was the liability/ responsibility of the original importer/ consignee - respondent no.4 to de-stuff the cargo from the containers and release the empty containers. The writ applicant had further relied upon Section 48 of the Act and had submitted that if the cargo is not cleared within a period of 30 days of unloading, the statutory authorities are under obligation to initiate proceedings thereunder of the Customs Act. However, in the facts of the case, almost period of 2 years have passed and no such proceedings seems to have initiated by the respondent authorities and on the other hand, the writ applicant is incurring huge financial liability as the containers though required for freight business purpose are lying ideal and blocked. The writ applicant has further relied upon the Circular Page 4 of 8 Downloaded on : Sat Dec 24 12:06:39 IST 2022 C/SCA/17185/2021 ORDER DATED: 03/03/2022 No.49/2018- Customs, dated 03.12.2018 issued by Central Board of Indirect Taxes and Customs wherein the Government has issued instructions to the Customs Authority as regards the procedure for disposal of unclaimed/ un-cleared cargo under Section 48 of the Act, which are otherwise lying ideal with the CFS.
5. On the other hand, Mr. Jinesh Kapadia, the learned counsel appearing for the respondent no.3 has drawn attention of this Court to the affidavit-in-reply and has submitted that one ASR Logistics India Pvt. Ltd. was nominated as Customs Broker by the original importer/ consignee whereby the bill of entry No.7380490, dated 01.04.2020 was filed seeking clearance of cargo. It was further submitted that the said Custom Broker had applied for seal cutting of the containers for collecting samples of the cargo for examination and infact, the Customs Department had permitted for seal cutting on 15.04.2020 as endorsed on the bill of entry. The ICEGATE data available with the respondent no.3 herein further reflects that actually the sample examination had taken place on 22.04.2020. However, the result of such sample examination is not within the knowledge of the respondent no.3. The learned counsel had further submitted that the cargo is in the liquid form and hazardous in nature, which cannot be de-stuffed in open place and requires caution for storage. In such circumstances, it is not feasible for the respondent no.3 to de- stuff the cargo from the subject containers of the writ applicant. The attention of this Court was drawn to various notices issued by the respondent no.3 in exercise of power conferred under Section 48 of the Act whereby the original importer/consignee was put to the notice to immediately clear Page 5 of 8 Downloaded on : Sat Dec 24 12:06:39 IST 2022 C/SCA/17185/2021 ORDER DATED: 03/03/2022 the cargo failing which the authority propose to proceed for auction sale. In fact, the respondent no.4 having not responded to such notices, the respondent no.3 had applied for permission for examination of cargo vide letter dated 11.11.2020 addressed to the Customs Department. However, till date no response has been received from the Customs Department. It was therefore submitted that in absence of any response from the Customs Department, the respondent no.3 herein has retained the cargo in the subject containers more particularly, the de-stuffing of cargo is equally hazardous. In fact because of inaction of the respondent no.4 herein, the ground rent and other charges has accrued to the tune of an amount of Rs.2,51,99,983/-, which is due on the consignee and/or their agents. Thus, Mr. Kapadia, the learned counsel for the respondent no.3 herein has prayed not to entertain any of the prayers so sought for by the writ applicant.
6. Mr. Nikunt Raval, the learned Senior Standing Counsel appearing for the respondents nos.1 and 2 herein had submitted that the goods being hazardous cannot be removed from the containers - flexi bags by any of the respondents and in any case, even the process under Section 48 or action will not be applicable in facts of the case, more particularly, when the test report of the sample examined by the Central Laboratory, Kandala has confirmed that the sample is not "fuel oil". Thus, the goods lying in the subject containers are "mis- declared" goods. It was further submitted that a query notice with respect to the same was issued upon the original importer
- consignee/respondent no.4. However, till date the original importer has not responded to such notice. Mr. Raval, the learned Senior Standing Counsel for the department has Page 6 of 8 Downloaded on : Sat Dec 24 12:06:39 IST 2022 C/SCA/17185/2021 ORDER DATED: 03/03/2022 however fairly conceded that admittedly, the ownership of the subject containers is of writ applicant and the same have been blocked for no fault of the writ applicant since 03.04.2020, but at the same time, this Court may not intervene at this stage, more particularly, the cargo being "misdeclared" goods and the imported goods being hazardous in nature, the same cannot be removed from the "flexi bags".
7. In the above mentioned peculiar facts and circumstances, this Court requested Mr. Raval, the learned Senior Standing Counsel appearing for the respondents nos.1 and 2 to seek appropriate instructions. In response to the same, Mr. Raval has come up with a proposal to permit the respondent authorities to issue a show cause notice in respect to the alleged misdeclaration of the imported goods in view of Section 111 of the Act to pass confiscation order of such misdeclared goods. Mr. Raval further propose that the Custom Authority shall expedite such proceedings within a period of 30 days from the date of receipt of the order of this Court. At the same time, he assured this Court that in case if the Custom Authority failed to pass such orders within a period of 30 days, appropriate process shall be undertaken by the respondents nos.2 and 3 herein to de-stuff the cargo into any other suitable containers or may also permit respondent no.3 herein to auction the same as proposed in the final notice issued by the respondent no.3 under Section 48 of the Act which will be followed by the release of the subject containers of the writ applicant in a period of 15 days thereafter.
8. In light of the aforesaid proposal being made by the respondent customs authorities, this Court finds that Page 7 of 8 Downloaded on : Sat Dec 24 12:06:39 IST 2022 C/SCA/17185/2021 ORDER DATED: 03/03/2022 considering the nature of hazardous substance lying in the subject containers, it would be appropriate to direct the respondent customs authorities to complete the proceedings as regards the "misdeclaration" of the imported goods followed by the confiscation order, if any, within a period of 30 days from the date of receipt of this order. We further make it clear and as assured by the learned Senior Standing Counsel appearing for the Customs authorities that if no such above order is passed within a period of 30 days, the respondent authorities including respondent no.3 herein shall proceed to de-stuff the cargo into any other suitable containers. The respondent authorities including respondent no.3 are at liberty to even auction the imported cargo as proposed in the final notice issued by the respondent no.3 herein under Section 48 of the Act and at the same time, hand over the custody of the empty subject containers to the writ applicant within 15 days thereafter.
9. With the aforesaid directions, the present writ application is disposed of. It goes without saying that this Court otherwise has not gone into the merits of the matter. The parties are at liberty to approach this Court in case of any difficulty.
(J. B. PARDIWALA, J) (NISHA M. THAKORE,J) NEHA Page 8 of 8 Downloaded on : Sat Dec 24 12:06:39 IST 2022