Board of
Trustees of The Port of Bombay Vs. Jai Hind Oil Mills Company & Ors [1987] INSC 8 (9 January 1987)
Venkataramiah,
E.S. (J) Venkataramiah, E.S. (J) Singh, K.N. (J)
CITATION:
1987 AIR 622 1987 SCR (1) 932 1987 SCC (1) 648 JT 1987 (1) 110 1987 SCALE (1)22
CITATOR
INFO : RF 1991 SC1243 (4)
ACT:
Major
Port Trusts Act, 1963: Sections 5,48 to 65. Bombay Customs House Public Notice
No. 111 dated July 29,
1985;
Paragraph
2(a).
Goods
detained by Customs House at Port--Clearance of--Demurrage charges levied by
Port Trust--Necessity for Court to ensure payment.
HEAD NOTE:
The
Major Port Trusts Act, 1963 empowers by cl.(d) of s.48 the Board of Trustees,
constituted under that Art, to impose rates in respea of wharfage, storage or
demurrage of goods at the port. Section 53 of the Act empowers and Board in
special cases to exempt either wholly or partially any' goods from payment of
any rate or of any charge leviable in respect thereof or remit the whole or any
portion of such rate or charge so levied. The Port Trust had in consultation
with the Customs authorities provided for grant of concession in the matter of
payment of demurrage charges on the issue of detention certificate by the
latter.
Paragraph
2(a) of the Bombay Customs House Public Notice No. 111 dated 29th July, 1985
provides for a regular detention certificate to be issued where the goods are
detained by the Customs House for the bona fide operation of import control
formalities.
A
dispute arose between the 1st respondent and the Customs authorities with
regard to the basic customs duty payable on the goods imported by the former.
By an interim order passed in a writ petition filed by the respondent, the High
Court directed the Customs authorities to allow clearance of the consignments
on respondent furnishing a bank guarantee in respect of the disputed amount of
duty payable, in favour of the Collector of Customs. The respondent, however,
failed to clear the goods from the Port.
Since
the consignments were incurring demurrage the respondent filed another writ
petition seeking a direction to the Customs authorities 933 to issue detention
certificates, which was allowed by the Court on the 1st respondent giving an
undertaking that it would pay the demurrage amount if it failed in the earlier
writ petition. The Customs authorities were, thus, obliged to issue the
detention certificates.
The
Port Trust was not made party to any of the writ petitions. It refused to honour
the detention certificates and to grant remission of demurrage unless the respondent
gave a bank guarantee to the extent of 80 per cent of the fees claimed. The
High Court, however, by an interim order, in the writ petition filed against
the Port Trust, directed the clearance of goods without payment of demurrage
and without insisting on the bank guarantee. The appeals filed against the
aforesaid orders were summarily dismissed by the High Court.
In the
appeals by special leave, it was contended for the appellant Port Trust, that
the High Court should not have directed the Customs authorities to issue
detention certificates without the Port Trust being made a party to the writ
petition and in any event without passing an order duly providing for the
payment of the wharfage and demurrage charges due to the Port Trust in the
event of the first respondent failing in its contention, and that the High
Court had committed an error in directing the first respondent to give a bank
guarantee only in respect of the customs duty payable and not making a similar
order with regard to wharfage and demurrage charges payable to the Port Trust.
Disposing
of the appeals, the Court,
HELD:
1. The power of the Port Trust to fix rates of demurrage and to recover the
same from an importer and to show concession as regards demurrage charges in
certain specified cases has been recognised. [942F-G] Trustees of the Port of
Madras v. M/s. Aminchand Pyarelal & Others, [1976] 1 SCR 721 and The Board
of trustees of the Port of Bombay v. Indian Goods Supplying Co., [1977] 3 SCR
343, referred to.
2.1
The orders passed by the High Court in the proceedings to which the Port Trust
was not a party, were not binding on the Port Trust in view of the violation of
the principles of natural justice. [943G-H]
2.2
The Port Trust being a body corporate constituted under Major Port Trusts Act,
1963 was entitled to he heard by the Court 934 before any order which affected
its interests prejudicially was passed. The High Court, therefore, before
compelling the Customs authorities to issue a detention certificate should have
issued notice to the Port Trust. This was necessary because on the production
of that certificate the Port Trust was under on obligation to permit the
clearance of the goods without payment of full demurrage charges. If ultimately
the party concerned was found to he at fault and become liable to pay the full
demurrage charges the Port Trust in the absence of a bank guarantee would not
be in a position to recover full demurrage charges from the party concerned
since it would have no longer any lien as provided by s.59 of the Act on the
goods which were already cleared. [943D-F]
3. The
orders of the High Court in the proceedings to which the Port Trust was a party
were contrary to the public notice issued by the Customs authorities as well as
the rules of the Port Trust. It erred in not imposing any condition on the
first respondent for protecting the interests of the Port Trust. It should have
directed the first respondent to furnish bank guarantee in respect of the
demurrage charges payable to the Port Trust in the event of the first
respondent being held to be in default ultimately, rather than merely directing
an undertaking to be given in favour of the High Court. [943B-D]
4. The
goods having already been cleared, to protect the interests of the Port Trust
the order passed on December I6, 1986 directing the first respondent to furnish
bank guarantee in favour of the appellant with regard to the balance of wharfage
and demurrage charges and in default thereof to pay the amount in cash would be
the final order in the matter.
The
customs authorities to complete the adjudication proceedings expeditiously and
within March 16, 1987. [944B-E]
CIVIL
APPELLATE JURISDICTION: Civil Appeal Nos. 4483 & 4484 of 1986 From the
Judgment and Order dated 26.6.86 of the Bombay High Court in Notice of Motion
No. 1418/86 in Appeal No. 512/86 in W.P. 1007/86.
F.S. Nariman,
O. Chenoy, A.K. Verma, D.N. Mishra and D.N. Bhansaria for the Appellant.
Soli
J. Sorabjee, M.M. Jayakar and B.R. Aggarwala for the Respondents.
935
The Judgment of the Court was delivered by VENKATARAMIAH, J. These appeals by
special leave are filed against the Order dated 26.6.1986 passed in Appeal No.
512 of 1986 in Writ Petition No. 1007 of 1986 and the Order dated 26.6.1986 in
Appeal No. 535 of 1986 in Writ Petition No. 1424 of 1986 of the High Court of
Bombay. Since these two are connected matters, they are disposed of by this
common judgment.
The
facts of these two cases are these. The appellant in both these appeals is the
Board of Trustees of the Port of Bombay (hereinafter referred to as 'the Port Trust') and the 1st
Respondent in both these appeals is a partnership firm by name M/s. Jai Hind
Oil Mills Company. The 1st Respondent imported 5 consignments of Propylene of
10 metric tons each in January, 1986 by S.S. Maribor. The general landing date
of the said consignments was 20th January, 1986 and the last free date in respect of them was 23rd January, 1986. Thereafter the said consignments
were incurring demurrage. The bills of entry were submitted by the 1st
Respondent to the Customs authorities in the same month. Disputes arose between
the 1st Respondent and the Customs authorities with regard to the basic customs
duty payable in excess of 32.50% (as goods were imported from the Republic of
Korea which was a developing country), with regard to loading the assessable
value with customs duty for calculation of the additional duty and with regard
to loading the CIF value with the landing charges. Not being satisfied with the
contentions of the Customs authorities the 1st Respondent filed a writ petition
in Writ Petition No. 122 of 1986 for the issue of certain directions to the
Customs authorities with regard to the levy of customs duty. In that Writ
Petition on January 21, 1986 the High Court passed an interim order which
directed the Customs authorities not to insist on payment of the customs duty
in dispute pending hearing and disposal of the Writ Petition on the 1st
Respondent furnishing a Bank Guarantee to the extent of the 90 per cent of the
disputed amount of duty in respect of one item and 100 per cent of the disputed
amount of duty in respect of two other items in favour of the Collector of
Customs. Thereafter some correspondence ensued between the 1st Respondent and
the Customs authorities in connection with the description of the above goods.
It would appear that while the Bill of Lading and the Invoice described the
goods as 'Propylene' the marks on the consignments indicated that they
contained 'Polypropylene'.
The
1st Respondent was asked to explain the discrepancy by the Customs authorities.
There was also some dispute raised as regards the invoice price. The 1st
Respondent could not, however, clear the goods 936 from the Port of Bombay.
Thereafter the 1st Respondent filed another Writ Petition No. 519 of 1986 for
the issue of a direction to the Customs authorities to permit it to clear the
consignments. On April 2, 1985 the learned Single Judge of the High Court of
Bombay who heard the said Writ Petition passed an order allowing the 1st
Respondent to dear the consignments on furnishing an Import Trade Control bond
for the value of the consignments calculated at the rate of U.S $ 735 per
metric ton and furnishing a Bank Guarantee of a nationalised bank in favour of
the Collector of Customs, Bombay to the satisfaction of the Prothonotary &
Senior Master, High Court, Bombay, for a sum equivalent to the difference in
the value between U.S $ 7 15 and U.S $ 735 per metric ton without prejudice to
the rights and contentions of the 1st Respondent. The said order provided that
the Customs authorities could continue their investigation and adjudicate upon
the duty payable by the 1st Respondent. On the basis of the above order the 1st
Respondent was allowed to withdraw the Writ Petition with liberty to file a fresh
petition, if required. Since there was a delay in the clearance of the
consignments in question and the 1st Respondent had become liable to pay
demurrage to the Port Trust, the 1st Respondent addressed a letter to the
Collector of Customs, Bombay asking him to issue a Detention Certificate
stating that the goods had been detained for bona fide Import Trade Control
formalities so that it could claim the remission of demurrage payable to the
Port Trust. The 1st Respondent followed up the above letter by another Writ
Petition No. 1007 of 1986 which was filed on or about the 17th April, 1986 against the Customs authorities for
the issue of a writ directing them to issue a Detention Certificate in respect
of all the 5 consignments. On the 24th April, 1986 the learned Single Judge passed a final order directing the Customs
authorities to issue a Detention Certificate to the 1st Respondent on the 1st
Respondent giving an undertaking to the Court that it would pay the amount, if
it failed in Writ Petition 122 of 1986. Pursuant to the Order' dated 24th
April, 1986 passed in Writ Petition No. 1007 of 1986 the 1st Respondent gave an
undertaking to the Court that it would pay the amount upon its not succeeding
in Writ Petition No. 122 of 1986. On the 21st May, 1985 the Port Trust received a letter
dated 19th May, 1986 from the Assistant Collector of
Customs in which it had been stated inter alia that five Detention Certificates
had been sent along with the said letter.. Actually no enclosures were received
along with the said letter. But later on they received two Detention
Certificates in respect of two out of the five consignments on that day. They
related to two bills of entry bearing Nos. 3133/219 and 3 133/220. On the same
day the Docks Manager of the Port Trust received a letter from the clearing
agent of the 1st Respondent asking 937 the Port Trust to grant the remission of
demurrage in view of the Detention Certificates issued by the Customs
authorities. Since the Port Trust was not a party to any of the Writ petitions,
referred to above; and no Bank Guarantee or Demand Draft had been furnished by
the 1st Respondent covering the 80% amount of the demurrage fees, the Port
Trust wrote a letter dated 30th May, 1986 to the 1st Respondent asking the 1st
Respondent to give a Bank Guarantee to the effect that in the event. of the 1st
Respondent losing Writ Petition No. 122 of 1986 it would pay to the Port Trust,
Bombay the entire amount of remission
along with interest at 15% per annum. When the aforesaid letter was sent, the
Port Trust was not aware of the Order dated 2nd April, 1986 passed in Writ Petition No. 519 of
1986. Thereupon, on June 12, 1986 the 1st Respondent and its partner Sham Lal Kishnani,
who is 2nd Respondent herein filed another Writ Petition No. 1424 of 1986 in
the High Court against the Port Trust for quashing the communication dated 30th
May, 1986, referred to above, under which the Port Trust had asked the 1st
Respondent to furnish the Bank Guarantee or a Demand Draft to the extent of 80%
of the demurrage fees claimed by the Port Trust and for compelling the Port.
Trust to honour the Detention Certificates issued by the Customs authorities
pursuant to the Order dated 24th April, 1986 and to permit the clearance of the
goods without payment of demurrage and without insisting upon the furnishing of
a Bank Guarantee or a Demand Draft, as stated above. They also asked for an
interim order of the effect that pending hearing and final disposal of the said
Writ Petition, the Port Trust should forthwith honour the Detention
Certificates issued by the Customs authorities and allow the clearance of the
goods without payment of demurrage and without insisting on the Bank Guarantee
or the Demand Draft. In that Writ Petition an interim order was passed on the
17th June, 1986 as prayed for by the 1st Respondent. Thereafter the Port Trust
was advised to file an appeal before the Division Bench against the Order dated
2nd April, 1986 passed in Writ Petition No. 519 of
1986 and the Order dated 17th
June, 1986 passed in
Writ Petition No. 1424 of 1986. While the Port Trust was in the process of
getting the said appeals made ready for filing by their advocates, the 1st
Respondent threatened the Port Trust with contempt proceedings by its letter
dated 20th June, 1986. Immediately after the receipt of the said letter, the
Port Trust lodged the Appeal no. 512 of 1986. By an order dated 26th June, 1986 the appeal filed against the Order
dated 2nd April, 1986 passed in the Writ Petition No.
1007 of 1986 was summarily dismissed. The said order, however, stated as under:
"It
is, however, clarified that it is clear from the impugned 938 order dated
24.4.1986 that the undertaking pertains to the demurrage charges payable to the
Port Trust. if the Respondents Nos. 1 and 2 (Petitioners) failed in Writ
Petition No. 122 of 1986 on the footing that no valid detention certificate
could have been issued in that event.
Mr. Chinoy
contends that the detention certificate could not be issued, if in the
adjudication proceedings the Petitioners are found at fault and the question of
the Petitioners giving an undertaking to provide for this does not appear to
have been present in the mind of the learned Judge when the order was passed.
Liberty to the Appellants 'to seek further
clarification and/or orders on this question from the learned Single
Judge." The appeal filed against the Order dated 17th June, 1986 in Writ Petition No. 1424 of 1986
was numbered as Appeal No. 535 of 1986. The said appeal was also summarily
dismissed on 26th June,
1986. As the Port
Trust was advised to file an appeal in this Court by special leave, the Port
Trust did not apply to the learned Single Judge for clarification as suggested
in the Order passed in Appeal No. 512 of 1986.
It may
be mentioned at this stage that the remaining three Detention Certificates
relating to Bills of Entry Nos. 3133/221,222 and 223 were received by the Port
Trust from the Customs authorities on 3rd July, 1986. Two out of the five consignments
were cleared by the 1st Respondent on 3rd July, 1986 and the remaining three
consignments were cleared by the 1st Respondent on 5th July, 1986 on payment of
an aggregate amount of Rs.49,510/50 paise for the charges of the Port Trust in
accordance with the Order dated 17th June, 1986 passed in Writ Petition No.1424
of 1986 as against a total amount of Rs.3,53,514.75 paise due to the Port Trust
for wharfage and demurrage charges upto the dates of the clearance of goods.
Thus a sum of Rs.3,04,004.25 in respect of wharfage and demurrage charges of
the said five consignments remains unpaid to the Port Trust. Aggrieved by the
two orders passed on 26th
June, 1986 in Appeal
No. 512 of 1986 and Appeal No. 535 of 1986 the Port Trust has filed these two
appeals by special leave.
939
The principal contention urged in both these appeals is that the High Court
should not have directed the Customs authorities to issue Detention
Certificates without the Port Trust being made a party to the Writ Petition and
in any event without passing an order duly providing for the payment of the wharfage
and demurrage charges due to the Port Trust in the event of the 1st Respondent
failing in its contention in Writ Petition No. 122 of 1986. It is urged that a
mere undertaking given in favour of the High Court agreeing to pay the amount
was not sufficient security for the amount due to the Port Trust in the event
of the 1st Respondent being held to be the party in default. It is further
contended that the High Court committed an error in directing the 1st
Respondent to give a Bank Guarantee only in respect of the Customs duty payable
by the 1st Respondent in the event of its Writ Petition being dismissed and in
not making a similar order directing the 1st Respondent to furnish a Bank
Guarantee in respect of the wharfage and demurrage charges payable to the Port
Trust in the event of the 1st Respondent being ultimately held as the party in
default.
The
Port Trust is constituted under the Major Port Trusts Act, 1963 (hereinafter
referred to as the Act). Under Section 5 of the Act every Board constituted
under it is declared to be a body corporate having perpetual succession and a
common seal with power, subject to the provisions of the Act, to acquire, hold
or dispose of property and it may be the name by which i.t is constituted, sue
or be sued. The affairs of the Port Trust are managed by the Board of Trustees
and committees appointed by it in accordance with the provisions of the Act. It
is thus an independent statutory body and not just a department of Government.
Under Chapter VI of the Act the Board of Trustees of a Port Trust is empowered
to impose and recover rates at Ports, for services rendered by the Port Trust
or other persons at the port under its jurisdiction.
Sections
48 to 65 of the Act which are in Chapter VI of the Act deal with the said power
of the Board of Trustees. Section 48 authorises a Board from time to time to
frame a scale of rates at which and a statement of the conditions under which,
any of the services specified there under shall be performed by itself or any
person authorised by it at the port or port approaches. Clause (d) of section
48 specifically empowers the Board to impose rates in respect of wharfage,
storage or demurrage of goods on any such place. Every scale of rates and every
statement of conditions framed by the Board under the foregoing provisions are
required to be submitted to the Central Government for sanction and will have
effect when so sanctioned and published by the Board in the Official Gazette.
It is, however, provided in section 53 of the Act that the Board of Trustees in
special 940 cases and for reasons to be recorded in writing, may exempt either
wholly or partially any goods or vessels or class of goods or vessels from the
payment of any rate or of any charge leviable in respect thereof according to
any scale in force under the Act or remit the whole or any portion of such rate
or charge so levied. The Port Trust has fixed the scale of rates charged at the
docks. A booklet containing the said rates which are revised upto 10.1.1985 is
produced before the Court. Section III of the said booklet which commences at
page 14 thereof contains the Docks scale of rates' fixed by the Port Trust. In
consultation with the Customs authorities, the Port Trust has provided for the
grant of concession in the matter of payment of demurrage charges on the issue
of Detention Certificate by the Customs authorities. Section III-A(c) of the
said booket deals with the demurrage fees chargeable by the Port Trust. Proviso
(d) to the said clause (c) states that the goods detained by the Customs
Department for special examination 'involving analytical or technical tests
other than the ordinary processes of appraisement' will be exempt from demunage
fees during such period of detention as may be certified by the Collector of
Customs to be not attributable to fault or negligence on the part of importers
or exporters plus two working days and that the Certification by the Customs
will be given by endorsement on relative duplicate copies of Bills of Entry or
Shipping Bills. On the suggestion of the Customs Department the Port Trust has
accepted to allow concession in the matter of demurrage charges to the extent
indicated in Paragraph 4.10 of the note which is enclosed as Ext. 'B' to the
Special Leave Petition (Civil) No. 8466 of 1986. It reads thus:
"4.10
The best course seems to be to charge a rate per day which corresponds to our
minimum charge for handling, storage, care and custody or the goods after the
expiry of the free days. Wharfage constitutes handling costs plus storage
charges for a period of four days. Deducting handling costs, the balance
represents storage charges for a period of four days. It is estimated that,
excluding the handling costs, storage charges per day are equal to 20% of total
wharfage.
It.
is, therefore, suggested that for the entire period of certified detention we
may retain per day 20% of the wharfage to cover the services referred to
herein." The above concession is extended by the Port Trust in appropriate
cases where Detention Certificates are issued by the Customs authorities. The
Customs authorities have laid down the procedure for issue of Detention
Certificates and the current procedure in 941 regard to the issue of Detention
Certificates is embodied in the Bombay Custom House Public Notice No.111 dated 29th July, 1985. Paragraph 2.of the said notice
sets out the circumstances under which a regular Detention Certificate could be
issued by the Customs House for facilitating the importers to get remission of
demurrage charges. They are as under:
"(a)
Where the goods are detained by Custom House for bona fide operation of Import
Control Formalities without any default on the part of the importers.
(b)
Where the goods have been released on caution (a regular Detention Certificate
and not a Recommendatory letter).
(c)
Where, the goods are detained the Custom House pending test report and the
facility of clearance against provisional assessment has not been allowed. Such
Detention Certificates will be issued on merits for the period for which the
goods were detained for the purpose.
(d)
Where, the goods are detained for PHO formalities, the certificate will cover
the period stretching between the date of drawal of the sample by the PHO and
the date of his test results, and
(e) In
cases where samples have been drawn from the imported consignments by the Asstt.
Drug/Controller for ensuring compliance with the provisions of Drugs and
Cosmetics Act, 1940 and where the Assistant Drugs Controller is of the opinion
that release cannot be allowed against a Letter of Guarantee pending
test." The said Public Notice also states that Detention Certificates will
not be issued in the following types of cases:
(a)
"Time taken by the Custom House Laboratory for analytical/chemical testing
of samples drawn from the consignments, since the facility of clearing the
goods on bond in terms of Section 18 already exists.
(b)
Samples drawn from the imported consignments by the 942 Assistant Drugs
Controller for ensuring compliance with the provisions of Drugs and Cosmetics
Act, 1940 and for being forwarded to the Central Drugs Laboratory, Calcutta, as
the importers can avail of the facility of clearing the goods against Letters
of Guarantee and need not wait till the receipt of the test report.
The
facility of allowing clearance of goods against letters of Guarantee is
extended only on the specific recommendations of the Assistant Drugs Controller
on the Bill of Entry in each case.
(c)
The period taken for mutilation of woollen rags in the Docks.
(d)
Cases where goods are detained in the ordinary course of appraisement such as
for determination of the Tariff classification of goods or their assessable
value in terms of Section 14 of the Customs Act." It is agreed between the
Customs authorities and the Port Trust that no Detention Certificate would,
however, be issued by the Customs Department if there has been any default on
the part of the importer or exporter. It is thus clear that in the event of the
importer or exporter being at fault, he would not be entitled to any concession
in the matter of demurrage charges. He has to pay whatever is payable in
accordance with the 'scale of rates' charged at the docks as fixed by the Port
Trust.
The
power of a Port Trust to fix rates of demurrage and to recover the same from an
importer or exporter (although the question of an exporter paying demurrage
arises rarely) under law and to show concession as regards demurrage charges in
certain specified cases is recognised by this Court in the Trustees of the Port
of Madras v. M/s. Aminchand Pyarelal & Others, [1976] 1 SCR 721 and in the
Board of Trustees of the Port of Bombay versus Indian Goods Supplying Co.,
[1977] 3 SCR 343. These decisions are no doubt based on the relevant laws which
were in force at the material time. But the decisions are still relevant
insofar as cases arising under the Act because the Act also contains provisions
more or less similar to the statutory provisions considered in the said
decisions. Demurrage charges are levied in order to ensure quick clearance of
the cargo from the harbour. They are always fixed in such a way that they would
make it unprofitable for 943 importers to use the port premises as a warehouse.
It is necessary to do so because congestion in the ports affects the free
movement of ships and the loading and unloading operations. As stated earlier. the
Port Trust shows concession to the party concerned in certain types of cases.
In the
instant case the High Court by the order passed in the writ petition to which
the Port Trust was not a party directed the Customs authorities to issue
Detention Certificates in respect of the consignments in question. In doing so
while the High Court had safeguarded the interests of the Customs authorities
by. its earlier orders by directing the 1st Respondent to furnish a Bank
Guarantee in respect of the duty payable to them, in respect of the demurrage
charges payable to the Port Trust the High Court merely directed an undertaking
to be given in favour of the High Court. In the ordinary course, the High Court
should have directed the 1st Respondent to furnish Bank Guarantee in respect of
the demurrage charges payable to the Port Trust in the event of the 1st
Respondent being held to be in default ultimately.
It is,
however, to be observed that before compelling the Customs authorities to issue
a Detention Certificate, the High Court should have issued notice to the Port
Trust which was vitally interested in securing its own interests as regards the
demurrage charges recoverable by it under law. This was necessary because on
the production of the Detention Certificate issued by the Customs authorities
the Port Trust was under an obligation to permit the clearance of the goods
without payment of full demurrage charges. If ultimately the party concerned is
found to be at fault and becomes liable to pay the full demurrage charges the
Port Trust may not be in a position to recover such full demurrage charges from
the party concerned, since it would have no longer any lien as provided by
section 59 of the Act on the goods which are already cleared The Port Trust
being a body corporate constituted under the Act is entitled to be heard by the
Court before any order which affects its interests prejudicially is passed.
This case serves as an illustration to what is stated above. The Port Trust has
been asked to permit the clearance of goods in respect of which demurrage
charges of Rs.3,53,5 14.75 paise are payable in the event of the 1st Respondent
being held liable in law to pay the full demurrage charges. The orders passed
by the High Court in the proceedings to which the Port Trust was not a party
which had the effect of prejudicially affecting the interests of the Port Trust
would not be binding on it in view of the violation of the principles of
natural justice. The High 944 Court erred in not imposing any condition on the
1st Respondent for protecting the interests of the Port Trust even in the Writ
Petition to which it was a party. The impugned orders are contrary to the
public notice issued by the Customs authorities as well as the rules of the
Port Trust.
Having
regard to the peculiar circumstances of this case in which the goods have
already been cleared, the orders of the High Court of Bombay against which
these appeals are filed are, therefore, to be modified appropriately in order
to protect the interests of the Port Trust. Accordingly, at the conclusion of
the hearing of these appeals we passed an order on 16.12.1986 before reserving
the appeals for judgment directing the 1st Respondent to furnish within eight weeks
a Bank Guarantee of a Nationalised Bank in favour of the appellant for due
payment of Rs.3,04,004.25 paise to the appellant on demand, without any demur,
being the balance of wharfage and demurrage charges in the event of the 1st
Respondent not succeeding ultimately in Writ Petition No. 127 of 1986 and on
failure to furnish such Bank Guarantee within eight weeks to pay in cash
Rs.3,04,004.25 paise to the appellant forthwith. This shall be the final order
in these appeals.
These
appeals are disposed of in the above terms. The Customs authorities shall
complete the adjudication proceedings as expeditiously as possible and in any
event within 16.3.1987.
P.S.S.
Appeals disposed of.
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