JUDGMENT
M.J. Rao, C.J.
(1) Rule D.B.
(2) The 1st petitioner is a shipping company in Japan while the 2nd petitioner is a company, acting as the agent of the 1st petitioner at Calcutta. The 1st respondent is the Union of India, the 2nd respondent is the Collector of Customs, Delhi and the 3rd respondent is the Assistant Collector of Customs, Delhi. The 4th respondent is the General Manager, Container Corporation of India, Tughlakabad, New Delhi. The 5th respondent is the Collector of Customs (Judicial) New Delhi.
(3) The petitioner which is the owner of the containers is, admittedly, not concerned with the validity of the import/export of goods by the consigner or consignee. The nine containers of the petitioners are lying in the inland container depot at Tughlakabad and, in fact, the Customs authorities, Bombay are asking the petitioner to re-export the containers out of India, Bombay being the port through which the containers were imported. The fourth respondent, the Container Corporation of India, Tughlakabad, New Delhi, is responsible for the handling of the containers and smooth movement of all containers in India.
(4) The petitioners say that for the purposes of clearance of import and export of cargo at New Delhi there is a Customs area called “Inland Container Depot” (“ICD for short”) situated at Pragati Maidan. An Icd is declared and notified as a “Customs Port” within the meaning of Section 2(12) of the Act. Ships carrying cargo discharge containers at any port in India and thereafter from the port to the Icd the containers carrying the cargo are transshipped as per the provisions of Section 54 of the Act. On arrival at the Icd, the goods are cleared in accordance with the provisions of Section 55 read with the other relevant provisions of the Act as are applicable to goods cleared at the Port of first importation or discharge. At the time of trans-shipment from the port of discharge to the Icd, the 2nd Petitioners, as agents for the ship owners, have to execute a Bond/Undertaking to re-export/reship the containers.
(5) The 1st petitioner inter alia, operate containerised transportation services in international trade. As carrier of goods, the contract of carriage of goods is subject to shippers load and count and the container is expected to contain the goods as per the description of the shipper as per international arrangements. The 1st petitioner and/or the 2nd petitioner, as carrier of goods, are not concerned with the validity or legality of the import or export of the goods contained in the containers by the consignor or consignee. The ship owners’ action in accepting and transporting the cargo in their containers is bonafide and in good faith. As a common carrier engaged in international ocean trade, the carrier accepts at ports of loading abroad cargo entrusted to their care for carriage to destinations. The carrier cannot be expected to know at the time of loading the cargo on board the vessel that the importer in India will be unable or unwilling to take delivery of the cargo for the reasons which have nothing to do with the carrier. The carrier cannot be a victim of a default on the part of the importer which is admittedly not of his making. There is, therefore, no justification in holding back the containers while investigations are in progress against the importers of the goods contained in the containers. The petitioners say that a container is a valuable capital asset for the ship owners. Containers are taken on lease generally at the rate of U.S. Dollars 2 per day upwards. If the ship owner is deprived of his revenue earning source, his business is seriously prejudiced.
(6) The petitioner says that presently 9 containers (hereinafter referred to as “the said containers”) are lying idle at the import cargo at Icd, New Delhi.
(7) As the customs authorities at Bombay were pressing the 2nd petitioner to re-export the said containers, the 2nd petitioner, by letter dated 9th October,1992 addressed to Respondent No.3 recorded that the Customs authorities at New Delhi were unwilling to de-stuff the cargo and release the containers until the availability of space in the warehouse and, therefore, requested respondent No.3 to appraise the customs authorities at Bombay about the same.
(8) By a letter dated 12th October,1992, the Superintendent of Customs, New Delhi, informed the 2nd petitioner that release of the said containers is “under active consideration” and that the goods contained in the said containers were likely to be put up for auction in the month and thereafter once the goods were sold/disposed of the said containers would be released.
(9) By a letter dated 11th January,1993, the Northern India Steamer Agents Association also made a representation to Respondent No.2 on behalf of its members Lines firm that more than 150 containers were held up at Icd New Delhi and requested that such containers be de-stuffed and the cargo taken out there from.
(10) There was no response from respondent No.2 to the said letter dated 11th January,1993. The 2nd petitioner, by a letter dated 22nd February, 1993 (with a copy marked to the Central Board of Excise and Customs), requested respondent No.2 to de-stuff the containers and to release the same. It was pointed out by the 2nd petitioner that the 1st petitioner was incurring leasing charges on a daily basis for the last two to three years at the rate of U.S. Dollars 2 per day.
(11) By a letter dated 22nd April,1993, in reply to the said letter dated 22nd February,1993, the Deputy Collector of Customs informed the 2nd petitioners that the goods contained in two of the containers were ripe for disposing of and were to be soon put up for auction after which, the containers would be released, while the three containers contained goods in respect of which the case was subjudice and, therefore, the containers could be released only after finalisation of the case and in respect of the balance four containers, the matter was under investigation.
(12) By a letter dated 28th May,1993, received from the Central Board of Excise and Customs, New Delhi, the 2nd petitioner was informed that the two containers contained calcium carbonate were being put up for auction and the same would be released after the goods are sold and lifted while the three containers could not be de- stuffed because of certain investigations pending clearance.
(13) Even after two months of the letter dated 22nd April,1993, the containers were not released to the petitioner, the petitioner, by a letter dated 22nd June,1993, again requested Respondent No.2 to get the containers de-stuffed and released the same to the petitioners.
(14) As there was no response to the said letter dated 22nd June,1993, the petitioner, by letter dated dated 7th July,1993, made another representation to the Central Board of Excise and Customs for release of the said containers.
(15) Thereafter, the petitioners awaited the release of at least the two containers bearing goods which were supposed to be auctioned immediately. From time to time, they made inquiries with respect to the same. Finding that there was no progress with respect to any of the nine detained containers, the petitioner addressed a comprehensive representation to the third respondent on 21st November,1974, pointing out the history of the case and seeking the immediate release of the containers.
(16) By a letter dated 9th December,1994, the Deputy Collector, Customs directed the petitioners to approach the 4th respondent for permission to destuff the containers and approach the 5th respondent for permission to destuff the 3 containers regarding which adjudication proceedings were pending before him. The petitioners addressed a letter dated 19th December 1994 to the 4th respondent requesting that space be allotted for destuffing the containers. The petitioners state that they have also received no response to their letter from the 4th respondent.
(17) Getting no information from the 5th respondent’s office, the petitioner has addressed a letter dated 9th May,1995 to the respondent requesting the return of the said four containers after destuffing the same. The petitioners has received no reply to the same till date.
(18) In this writ petition, notice was issued on 6.7.95 for 6.9.95. On 6.9.95, respondents 1 to 3 and 5 sought time to obtain instructions. On 28.9.95, counsel for respondents 1 to 3 and 5 appeared. Counsel for 4th respondent was also present. Arguments were heard.
(19) According to the respondents, they have indeed no objection to return the 9 containers but they have difficulty in not having other containers of their own into which the goods could be removed. The customs case against the importer of the goods is still pending. Though the petitioners are not concerned with the validity of the import/export of goods, the deficiency of spare containers is the only reason for not returning or releasing the petitioner’s containers.
(20) Now the appellant is bound under (Annexure A) executed in favor of the President of India to take back the containers and re-export the same. Even the Assistant Collector, Customs, Delhi in his reply dated 12.10.92 (Annexure D) to 2nd petitioner admitted: “THIS office is in receipt of your office letter dated 9.10.91 on the above subject. It is stated in this connection that the question of release of long staying containers is under active consideration and the required action being taken. The goods contained in these containers are likely to be put for auction in the ensuing auction to be held next month. As soon as the goods are sold off/disposed off the containers shall be released.”
(21) Again in the reply dated 22.4.93 (Annexure G), the Collector of Customs said: “PLEASE refer to your letter no. nil dated 22.2.93 addressed to the Collector of Customs, New Delhi on the above subject. The goods of the containers mentioned at sr. no. 1 and 2 are ripe for disposal and are being put up for auction, which is going to be held very soon. We hope that the said containers will be de-stuffed and released after the auction. As regards container Nos. mentioned at sr. no. 3 to 5 it is to be informed that bill of entry no. 100109 dated 18.4.91 was filed by the importer M/s Amba Spinners. However, after that the case became subjudice. Hence any action to release the containers could be taken after finalisation of the case only. Regarding container sr. no. 609 it is to be informed that the importer M/s Mehra Associates had filed bill of entry no. 100770 and 100771 dated 26th June’91. Since then the Dri has taken up the issue for investigation. They are being requested to expedite the investigation. Any action for release of these containers will be taken after completion of the same.”
(22) The reason for delay in release is given in another letter of the respondents dated 28.5.93(Annexure H) as follows: “I am directed to refer to your letter dated 22.2.93 addressed to Collector of Customs, Delhi and a copy endorsed to Board on the above subject. The matter has been examined in consultation with Collector of Customs. It is found that out of the 9 containers only first two containers are ripe for disposal. In these containers calcium carbonate is stuffed. These are being put for auction. The said two containers could be released after the goods have been sold and lifted. The containers mentioned at Sr. No. 3 to 5 cannot be destuffed because of certain investigations pending clearance.”
(23) Then comes another letter of the Deputy Collector of Customs dated 9.12.94 (Annexure L) as follows: “PLEASE refer to your letter dated 21/22.11.94 on the above subject. Since the containers are in the custody of the Custodians, this office has no objection in destuffing the containers if the containers have safe place for the destuffed goods. You are therefore, requested to take up the matter with the custodians. As regards the containers of M/s Mehra Associates, this case is pending adjudication with the Collector of Customs (Judicial), New Customs House, New Delhi. Since the permission of the adjudication authority is essential for getting the containers destuffed. You may approach him for necessary permission to get the containers destuffed in the safe custody of the custodian (COMCOR).”
(24) In between, we find several demands by the appellant for return of the containers.
(25) Learned counsel for the petitioners has also placed before us the Cbe & C. Circular No. 84/95 dated 25.7.95 in regard to ‘Containers to be emptied and released when cargo is detained for a long period’. Paras 2,3 and 4 thereof read as follows: “2.THEmatter has been examined by the Board and it is observed that at times the customs is detaining the imported cargo Along with containers in which it has been unloaded for the purpose of investigation. The Directorate of Revenue Intelligence is also insisting upon detention of imported cargo till such time as the enquiry/investigation undertaken by it is completed. It is the view of the Board that for facilitating investigation the detention of the imported cargo may be necessary at times. However, this should not be at the cost of hardship to other importers or the container agents as the imported containers may be required for use by persons other than the importer of the detained cargo. At the same time, long detention of cargo including containerised cargo no doubt blocks valuable space in the already congested ports. This is not also desirable. 3.Having regard to the legal necessity of detention of imported cargo and at the same time taking into account the difficulties created by such detention, as detailed above, it has been decided by the Board that long detentions of imported cargo including containerised cargo at the ports is to be avoided by the Customs Authorities including Intelligence and enforcement authorities. Accordingly, the Board desires that whenever it becomes necessary to detain the imported cargo for long time periods pending completion of enquiry/investigation, such cargo should be removed to a customs warehouse in terms of the provisions of Section 49 of the Customs Act, 1962. For this purpose the cargo can also be removed from the container and the container can be released for use by the container agents/other importers. 4.It is desired by the Board that the above procedure for detention of imported cargo may be followed with immediate effect by the concerned officers of customs. For this, a suitable departmental instruction/standing order may be issued. It is further desired by the Board that the Commissioners of Customs/DGRI may monitor all containers detained for investigation so as to ensure that unnecessary detention of import cargo for long time periods and beyond the required time is not resorted. A report of the review undertaken in this regard may be sent by 30.9.95 indicating only cases where such containers are required to be detained beyond 6 months with justification therefore.
(26) The respondents have a duty to follow the above circular issued by their department.
(27) It is stated by the learned counsel for the petitioner that, as stated in the correspondence, the hire- charges for each container per day is about $ 3 and that for 5 years, the hire charges for the 9 containers would have amounted to several lakhs of rupees. The petitioner is also bound, as per Bombay Customs authorities to re-export the containers. The respondents have kept the containers for 5 long years. Petitioners say that they are suffering damages at $ 3 per day per container because of rate of hire charges payable and also loss of profit that might accrued to them by use of the containers in their business. In our view, there is no reasonable statutory or legal basis to continue the further detention of the containers. Even as per the Cbe & C Circular, the detention is for an unduly long period.
(28) A point also arose during the course of arguments of the respondent’s counsel that the respondents might claim that they are not liable for to pay any damages to the writ petitioner. If indeed, the respondents are likely to contend that they are not liable for damages, then the need for directing return of these containers is indeed very much necessary.
(29) We are, therefore, constrained to observe that the respondents have taken unduly long time to return/release the containers to the petitioners and the period of 5 years is surely long enough. The petitioners say they are incurring loss. It is likely that respondents may contend that they need not pay any compensation or damages. That may lead to further litigation. (We are not to be understood as expressing any opinion on the question of damages/compensation.)
(30) Be that as it may, as the non-release of the 9 containers in Schedule B is unduly prolonged and is without justification and is arbitrary, we hereby direct the respondents to return/release the said containers within 4 months from today. A direction will issue to that effect.
(31) Writ petition is allowed as stated above. No costs.