Modern Line Vs Assistant Commissioner of Customs (Madras High Court)
Madras High Court has dismissed a writ petition filed by Modern Line, seeking a waiver certificate for demurrage and detention charges on imported goods. The court upheld the Assistant Commissioner of Customs’ decision, which rejected the waiver request on the grounds that no seizure, detention, or confiscation order had been issued by Customs Authorities concerning the goods.
Modern Line contended that the demurrage charges were incurred solely because Customs Authorities initially refused their request to re-export the goods. The petitioner explained that the original importer failed to take delivery of the goods as the related project did not proceed, leading Modern Line to seek re-export.
The High Court noted that in an earlier writ petition (W.P.Nos.727 and 733 of 2024), filed by Modern Line, the court had, on June 7, 2024, directed the Customs Department to consider the re-export request. In that prior order, the court also found that a circular relied upon by Customs for rejecting the re-export request was not applicable to Modern Line’s case. Despite this, Modern Line argued that the demurrage charges were a direct consequence of the Customs Authorities’ actions.
However, the Assistant Commissioner of Customs maintained that there was no liability to reimburse these charges, a position also reflected in the counter affidavit filed before the court.
The High Court, in its current ruling, reiterated that the primary condition for seeking a waiver of demurrage and detention charges is the existence of a seizure, detention, or confiscation order passed by Customs Authorities. Since no such order was passed in this case, the court concluded that the question of issuing a waiver certificate did not arise.
Furthermore, the court observed that the importer, who allegedly refused to take delivery of the goods and thus compelled Modern Line to seek re-export, was not made a party to the current writ petition.
After considering all the facts, the Madras High Court found no merit in Modern Line’s writ petition and consequently dismissed it. No costs were awarded, and the connected miscellaneous petition was also closed. This judgment reinforces that the absence of a formal customs order for seizure, detention, or confiscation precludes a claim for demurrage and detention charge waivers.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
This writ petition has been filed challenging the impugned order passed by the first respondent rejecting the petitioner’s request for the issuance of waiver certificate for the waiver of demurrage and detention charges for the goods imported vide BL.No.HLCURJ2230100994, dated 27.01.2023, and IGM No.2336440 dated 24.02.2023 on the ground that since there is no seizure, detention or confiscation order passed by the Customs Authorities, the request for waiver cannot be granted.
2. The petitioner contends that only due to the fact that the petitioner’s request for re-export was refused by the Customs Authorities, the petitioner has
3. Admittedly, the first respondent has not passed any order in respect of the subject goods for seizure, detention or confiscation. Only in cases where such order passed by the Customs Authorities is held to be illegal, the question of seeking waiver of demurrage and detention charges will arise. The petitioner claims that the importer, who had earlier imported the subject goods, failed to take delivery of the same, since the project did not go through, and under those circumstances, a request was made by the petitioner to re-export the goods, which was initially refused by the Customs Authorities. According to the petitioner, in the earlier writ petition filed by them in W.P.Nos.727 and 733 of 2024, this Court, by order dated 07.06.2024, directed the Customs Department to consider the petitioner’s request for re-export and in the said order, a finding was also rendered that the circular which was relied upon by the Customs Authorities for rejecting the petitioner’s request for re-export, is not applicable to the petitioner’s case. The petitioner contends that only due to the fault of the Customs Authorities, the petitioner had to incur demurrage charges, which is payable to the respondents 2 and 3. The first respondent has not admitted their liability to reimburse demurrage charges alleged to have been incurred by the petitioner as seen from the counter affidavit filed before this Court as well as from the submission of the learned standing counsel for the first respondent.
4. Admittedly, the Customs Authorities have not passed any orders for seizure, detention or confiscation in respect of the subject goods. When no such order has been passed, the question of issuance of waiver certificate for waiver of demurrage and detention charges as prayed for in this writ petition does not arise. The importer, who is said to have refused to take delivery of the goods from the petitioner, which ultimately forced the petitioner to re-export the goods, is also not a party to this writ petition.
5. Therefore, after giving due consideration to the aforesaid facts, this Court is of the considered view that there is no merit in this writ petition. Accordingly, this writ petition is dismissed. No Costs. Consequently, connected writ miscellaneous petition is also closed.
