HINDUSTHAN LEVER LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) Short question involved in this writ petition is whether the demurrage paid by the consignee for delayed unloading can attract customs duty in accordance with the provisions of Customs Act, 1962.

(2.) The writ petitioner imported a consignment from abroad by M.V. Amastasi vide bill of lading appearing at page 25-27 of the writ petition. The said vessel arrived at Calcutta. However, there had been delay in discharging the cargo at the port for which the writ petitioner had to pay demurrage to the Port Trust Authority. The Customs Authority, while assessing the duty, included the demurrage charged by the Port Trust Authority and paid by the writ petitioner. According to the Customs department the demurrage was a part of the freight and was liable to be paid as additional value of the goods. Since the value of the goods attracted duty the writ petitioner was liable to pay duty in accordance with the assessment made by the authority.

(3.) Dr. Tapas Banerjee, learned counsel appearing for the petitioner, submitted that the duty within the meaning of the Customs Act, 1962 includes freight. However, the demurrage is not included therein. According to Dr. Banerjee since goods were landed at the Calcutta Port the same attracted duty on the value of the goods and the freight, delay in effecting the actual delivery by unloading from the ship was really an act done within the port premises. Since there had been delay in unloading the Port Trust Authorities were entitled to charge demurrage because of detaining the ship in its berth or using the port premises for unloading beyond the scheduled period. The same could not be included in the value of the goods for the purpose of assessment of customs duty. In support of his contention Dr. Banerjee cited three decisions reported in (i) 2000 Volume 122, Excise Law Times, page 615; (ii) 2001 Volume 131, Excise Law Times, page 207; (iii) 2001 Volume 133, Excise Law Times, page 526.