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 'MSC Shipping' filed CS No. 168 of 2016 in the Hon'ble High Court of Kolkata against the 'Corporate Debtor' for payment of container, demurrage charges, return of the containers after de-stuffing cargo sale of the de-stuffed cargo and receipt of the proceeds thereof.
Learned Counsel argued that as per Clauses 17 and 20.3 of the Bills of Lading, 'MSC Shipping' has lien on the cargo for demurrage charges and other dues.
 Pursuant to the Order dated 21.09.2017 passed by the Hon'ble High Court of Kolkata, the cargo was de-stuffed and the empty containers returned to 'MSC Shipping'. The 'Corporate Debtor' filed GA 1852 of 2018 praying inter alia for sale of the de-stuffed cargo upon valuation by an independent valuer, which Application, was allowed by the Hon'ble High Court vide a Order dated 26.09.2018 and the 'Customs Dept.' was directed to auction the cargo and hold the sale proceeds subject to further Orders. Accordingly, the 'Customs Dept.' sold the cargo by Public Auction in accordance with the provisions of the Customs Act, 1962 for Rs. 10,60,10,000/- on 26.04.2019. It is argued Company Appeal (AT) (Insolvency) No. 1048-1049 of 2019 With Company Appeal (AT) (Insolvency) No. 200 of 2020 that 'MSC Shipping' is entitled to receive the sale proceeds as they have lien over the cargo.
 Vide Order dated 26.09.2018, the Hon'ble High Court of Kolkata has permitted the 'Corporate Debtor' to participate in the said Auction.
Subsequently, the 'Customs Dept.' addressed letters dated 18.10.2017 and 26.10.2017 and sought for the participation of the 'Corporate Debtor'.
 The goods de-stuffed were finally sold on 26.04.2019 by e-Auction, giving notice to the 'Corporate Debtor', for on amount of Rs.
10,60,10,000/-. In compliance with the direction passed by the Hon'ble High Court the bid amount was kept in a Fixed Deposit Account with SBI.

 In order to stop the 'Customs Dept.' from going ahead, the IRP preferred an Application before the Adjudicating Authority being CA(IB) No. 575/KB/2019 on 24.04.2019 praying for stopping the 'Customs Dept.', from auctioning the goods belonging to the 'Corporate Debtor' and Notice was issued in the said Application. Ignoring the intimation by IRP, the Dept. illegally auctioned the goods contained in Company Appeal (AT) (Insolvency) No. 1048-1049 of 2019 With Company Appeal (AT) (Insolvency) No. 200 of 2020 the 256 containers on 26.04.2019 after the initiation of CIRP on 05.03.2019 which is against the objective and spirit of the Code.  Learned Counsel submitted that the value of the goods contained in the balance 667 containers lying in the illegal custody of the Authority is getting eroded with each passing day. The raw material stored in the 667 containers which has been directed to be returned to the 'Corporate Debtor' by the Adjudicating Authority, can be used by the 'Corporate Debtor' as it is still a going concern employing 1800 people. Adjudicating Authority disposed off the Application preferred by the IRP namely CA(IB) 891/KB/2019 in the recent Order dated 30.08.2019, wherein the 'Customs Dept.' was directed to make payment to the 'Corporate Debtor', the amount generated by the illegal Auction sale and further permitted the relation of the remaining goods contained in the 667 containers to the Corporate Debtor.  The Learned Counsel relied on the ratio of this Tribunal in 'Commissioner of Customs (Preventive) West Bengal' (Supra) wherein it was observed that when the Customs Authority had failed to Auction the goods belonging to the 'Corporate Debtor', prior to the initiation of CIRP, the authority could not have proceeded to Auction the goods during the Moratorium period which is in violation of Section 14 of the IBC.

24. From the aforesaid provision, it is clear that in case of non-clearance of the goods within 30 days or within extended period or if the title of any imported goods is relinquished after notice to the importer and with the permission of the proper officer, the goods can be sold by the Custom Authority. Section 48 of the Customs Act, 1962 relates to sale of goods in the custody of the Customs in the manner prescribed therein.

25. The Resolution Professional preferred an Application CA(IB) 575/KB/2019 in CP(IB) No. 513/KB/2018 on 24.04.2019 seeking to restrain the 'Customs Dept.' from auctioning the goods belonging to the 'Corporate Debtor' in which Application/Notice was issued on 25.04.2019. It is an admitted fact that the goods contained in 256 containers were auctioned on 26.04.2019 subsequent to the initiation of the CIRP on 05.03.2019. To reiterate, though the Hon'ble High Court of Kolkata has permitted the auction of the goods by the Customs Authority following due procedure provided in the Customs Act, 1962, and the Order is dated 19.07.2018, the Customs Authorities did not auction the goods till Moratorium under Section 14 of the IBC was imposed on 05.03.2019. Subsequent to the Notice issued on 25.04.2019, by the Adjudicating Authority, on 26.04.2019 the goods were finally auctioned, after the initiation of the CIRP and during the Moratorium period. It is stated that the goods contained in the balance 667 containers continue to remain in the custody of the 'Customs Dept.'. Vide Order dated 03.02.2020, by the Adjudicating Authority, 'Corporate Debtor' has gone into liquidation and is being run as a going concern. We do not find force in the contention of the Learned Counsel appearing for the 'Customs Dept.' that Company Appeal (AT) (Insolvency) No. 1048-1049 of 2019 With Company Appeal (AT) (Insolvency) No. 200 of 2020 Section 48 of the Customs Act, 1962, is applicable to the facts of this case. This Tribunal in 'Commissioner of Customs (Preventive) West Bengal' Vs. 'Ram Swarup Industries Ltd. and Ors.' Company Appeal (AT) (Insolvency) No. 563 of 2018 has dealt with Section 48 of the Customs Act, 1962, in similar circumstances where the goods were auctioned during the Moratorium period, held that the assets of the 'Corporate Debtor', during the Moratorium period, cannot be alienated, transferred or sold to the third party. In the instant case also the Order of Moratorium was passed by the Adjudicating Authority on 05.03.2019. Immediately thereafter it was not open to the 'Customs Dept.' to conduct the auction on 26.04.2019 though the goods were lying with them for more than 2 years and there was a direction by the Hon'ble High Court Kolkata prior to the CIRP period. Having failed to auction the goods prior to the CIRP period, the 'Customs Dept.' cannot now, subsequent to the imposition of Moratorium, proceed to auction the goods. Having done so, the sale proceeds of the so conducted auction cannot be made over to the 'Customs Dept.'. It is relevant to mention that a Review Application has been filed before the Adjudicating Authority on 30.08.2019 which was dismissed vide Order dated 19.11.2019 and the Customs Authority was directed to make payment to the 'Corporate Debtor'.