Legal principle

A Customs Detention/Demurrage Waiver certificate under Regulation 6(1)(l) of the Handling of Cargo in Customs Areas Regulations, 2009 is binding on the Service Provider but is only an eligibility certificate, and disputes between the Service Provider and the importer/exporter regarding charges, release of goods or refund of deposits must be resolved through adjudication (e.g., before the Civil Court) and cannot be settled directly in a writ petition under Article 226.

Court decision

The Madras High Court dismissed the writ petition with no costs. It held that while the Detention certificate issued under the Customs Act/Regulations is binding on the Service Provider, it is merely an eligibility certificate for claiming refund and cannot be the sole document for release of goods or refund of deposits without further adjudication of the disputes or grievances existing between the Service Provider (a private party) and the importer/exporter.

Facts

M/s. Sai Lakshmi Engineering, a Guntur-based importer of agricultural implements and equipment (IEC No.0909002924 dated 13.07.2015), imported goods vide Bill of Entry No.5103334 dated 07.02.2018 in container No.ZIMU 1132145 through the CFS of M/s. Sudarshan Logistics Pvt. Ltd. The Docks Intelligence Unit of Customs issued Detention/Demurrage Waiver Certificates dated 25.05.2018 from File No.S.Misc.11/2018-DIU invoking Regulation 6(1)(l) of the Handling of Cargo in Customs Areas Regulations, 2009. Despite the certificates, the goods were not released and the Service Provider continued to claim demurrage and container detention charges, prompting the importer to file a writ petition for release of the goods free of such charges.

Key provisions

• Regulation 6(1)(l), Handling of Cargo in Customs Areas Regulations, 2009 — Responsibilities of Customs Cargo Service provider
• Regulation 3, Handling of Cargo in Customs Areas Regulations, 2009 — Application
• Section 30A, Customs Act, 1962 — Passenger and crew arrival manifest and passenger name record information
• Section 41A, Customs Act, 1962 — Passenger and crew departure manifest and passenger name record information
• Section 50, Customs Act, 1962 — Entry of goods for exportation
• Section 53, Customs Act, 1962 — Transit of certain goods without payment of duty
• Section 126, Customs Act, 1962 — On confiscation property to vest in Central Government
• Section 157, Customs Act, 1962 — General power to make regulations
• Section 46, Customs Act, 1962 — Entry of goods on importation
• Section 49, Customs Act, 1962 — Storage of imported goods in warehouse pending clearance or removal
• Section 41, Customs Act, 1962 — Delivery of departure manifest or export manifest or export report
• Section 54, Customs Act, 1962 — Transhipment of certain goods without payment of duty