(Per : HONOURABLE MS.JUSTICE HARSHA DEVANI) This petition under Article 226 of the Constitution of India the petitioner seeks the following substantive relief:
"[19] In the aforesaid premises, the petitioner approaches Your Lordships under Article 226 of the Constitution of India and prays that:
[a] Your Lordships may be pleased to issue appropriate writ of mandamus or a writ in the nature of mandamus or any other suitable writ, order or direction which the Hon'ble Court may deem fit, just and proper, quashing and setting aside the letter dated 16th June 2003 of the Central Warehousing Corporation as per Annexure-O and direct them to release the payment of Rs.45,89,161/- to the petitioner forthwith and further hold and declare that the action of the respondents No.1 and 2 as arbitrary, illegal and against the provisions of law inasmuch as the respondent No.1 cannot withhold the amount on the advice of the Respondent No.2 received from the respondent No.3 Insurance Company being the CIF value of the goods stored at the respondent No.1 Warehouse at Kandla, for which the petitioner has paid the premium for the CIF value plus customs duty and further be pleased to direct the respondent No.1 to release the entire amount of Rs.45,89,611/- paid by the respondent No.3 towards CIF value with interest to the petitioner forthwith."
The petitioner is a company engaged, inter alia, in the business of manufacture of silencer, exhaust pipe and sub-assembly for four wheeler vehicles, classifiable under Chapter 8708.92 of the Central Excise Tariff Act, 1985. For the purpose of manufacturing these spare parts and assembling the same, the petitioner was importing from Japan certain material, namely, C.K.D. Parts, which are mainly used for manufacturing the muffler, which is a part of the silencer, known as "Exhaust System", in the four wheeler vehicles, and are classifiable under Chapter Sub Heading 8708.92 of the Customs Tariff Act, attracting advalorem duty of 50% on the basic value of the material imported. The petitioner was also importing Glass Wool which is also used in the muffler, which is classifiable under Chapter 70 sub-heading 70.19.00 and at the relevant point of time, the same attracted duty at 40% and other permissible duties under the provisions of the Customs Act. From 9.12.1996 to 6.1.1998, the petitioner has filed various bills of entry through its Customs Handling Agent as enumerated in paragraph 5.2 of the petition. The total value of the goods so imported was rupees four crores approximately. The said goods were kept in custody of the Customs Department Bonded Warehouse, that is, the. Central Warehousing Corporation's godown at Gandhidham pursuant to which, necessary bonds had been executed under section 59 of the Customs Act, 1962 (hereinafter referred to as "the Act") with the Proper Officer on behalf of the petitioner by the CHA in the prescribed form.
It is the case of the petitioner that when the goods are warehoused in the bonded warehouse, as per the provisions of the Act, the importer has to insure the goods.
Under the rules framed by the Central Government under the provisions of the Customs Act, in bonded warehouse where the importer has to warehouse the goods, it is insisted upon that the goods as well as duty amount are duly insured, so that in case of any loss/damage to the bonded goods, the duty can be paid to the Central Government by claiming the insurance. According to the petitioner, the petitioner had paid all the necessary charges including premium through its CHA because as per the customs handling regulations, the bill which has been raised by the CHA includes the warehousing charges as well as the premium of goods warehoused in the bonded warehouse which includes CIF value plus duty amount as payable upon the said goods which had been warehoused.
On 9.8.1998, the entire coastal Gujarat was struck by a cyclone as a consequence of which, the coastal area of Gujarat was severely damaged and the properties worth crores of rupees came to be destroyed. The goods of the petitioner which had been warehoused in the bonded warehouse were also adversely affected because of water logging in the warehouse godown. The Central Warehousing Corporation informed the CHA of the petitioner on 15.6.1998 that on account of cyclone and tidal waves that followed it, most of the stock had been affected.
It is further case of the petitioner that on 4.8.1998, the petitioner had lodged its claim with the Central Warehousing Corporation. Pursuant to intimation from the respondent No.1 - Corporation, the petitioner appointed two surveyors for assessing the percentage of damage of the goods warehoused in the godown of the respondent No.1. M/s Bhatawadekar & Co. and Elecon Surveyors carried out a joint survey and submitted their report dated 13.11.1998 to the petitioner stating that a particular quantity out of the goods stored in CWC Warehouse at Gandhidham had been damaged. The surveyors by their letter dated 29.11.1998 had assessed the damage at Rs.48,89,610.85 ps. It is the case of the petitioner that on 31.8.1998, the Customs Department called upon the petitioner to pay customs duty upon the goods which had not been cleared from the bonded warehouse as per permission granted by the Department. On 1.12.1998, the petitioner requested the Commissioner of Customs, Kandla to issue remission certificate for remission of duty on destroyed/abandoned goods. It is further the case of the petitioner that at the time of taking insurance, the respondents No.1 and 2 who had insured the warehoused goods with the respondent No.3 had collected the premium from the petitioner for the principal amount of the goods plus customs duty and had informed the Customs Department accordingly. According to the petitioner, the petitioner's claim is against the respondent No.1 Warehousing Corporation and the respondent No.2, as the respondent No.3 Insurance Company has already paid the CIF value of the goods stored at the CW godown, Kandla. Hence, the respondent No.1 is under an obligation to pay the full amount of CIF value to the petitioner and has not authority to withhold the same. It is also averred in the petition that if the respondent No.3 has failed to pay the customs duty, for which the petitioner has paid the premium, the petitioner will take appropriate proceedings before the adjudicating authority against the action of the respondent No.3 Insurance Company for not releasing the customs duty though the petitioner has paid the premium for the customs duty also as per the insurance regulations.
It is the categorical case of the petitioner that the petition is confined only against the respondents No.1 and 3 in not releasing the principal amount which is due and payable by the respondent No.1 to the petitioner. Being aggrieved by the action of the respondent No.1 in not releasing the amount of Rs.45,89,161/- received by it from the respondent No.2 in favour of the petitioner towards the damages caused to the goods of the petitioner, the petitioner has filed the present petition, seeking the relief noted hereinabove.
According to the petitioner despite several representations having been made to the respondent No.1 for release of the amount in question along with interest, the respondent No.1 did not pay any heed to the same. The petitioner had, therefore, filed a writ petition being Special Civil Application No.8629 of 2002 which came to be disposed of by an order dated 27.1.2003, whereby the Court directed the petitioner to make representation to the respondent therein and further directed the said respondent to decide the same in accordance with law keeping in mind the letter dated 26.12.2001 (Annexure "I" to the said petition). Pursuant to the said order, the petitioner made a representation to the Regional Manager, Central Warehousing Corporation, which came to be turned down on 16.6.2003, by directing the petitioner to make a representation to the Customs Department. It is further the case of the petitioner that it was the Central Warehousing Corporation who ought to have made the payment to the petitioner because the petitioner had paid all the charges to the Central Warehousing Corporation, including insurance charges, customs duty, CIF value of the goods, and therefore, it was not permissible for the Central Warehousing Corporation to retain/withhold the amount on the ground that the Customs Department had not granted remission under section 23 of the Act.
It is in the backdrop of the aforesaid facts and circumstances that the petitioner has preferred the present petition seeking the relief noted hereinabove.
Heard Mr. B. T. Rao, learned advocate for the petitioner, Mr. N. R. Mishra, learned advocate for Mr. R. K. Mishra, learned advocate for the respondent No.1, Ms. Anushree Kapadia, learned advocate for the respondent No.3 and Ms. Amee Yajnik, learned Senior Standing Counsel appearing on behalf of the respondents No.2 and 4.
On 13.7.2004, this Court had passed a detailed order wherein in paragraph 8 thereof it was recorded as under :
"[8] In the present case, the Insurance Company has already paid the Corporation (CWC) the amount of Rs.45,89,611/- towards the damage caused to the petitioners' cargo and, therefore, at this stage no interim orders are required to be passed against the Insurance Company. However, following the aforesaid interim order dated 30/8/2001 in SCA No.242 of 2001 of Milton Plastics, we direct that the Central Warehousing Corporation shall release, in favour of the petitioner, after deducting the necessary charges for storage of the petitioners' cargo (stated to be Rs.70,046), if any, the amount received from the United India Insurance Co. Ltd. towards the petitioners' cargo. As stated in the reply affidavit dated 11/4/2004 filed by Mr R. N. Meena, Regional Manager of Central Warehousing Corporation in Civil Application No.2950 of 2004, the Corporation has already paid the petitioner Rs.8,04,980/- and accordingly the balance amount of Rs.37,14,585/- now remains payable by the Corporation to the petitioner.
Accordingly, by this interim order, without prejudice to the rights and contentions of the parties and subject to the final outcome of the present petition, the Central Warehousing Corporation is directed to pay the petitioner the balance amount of Rs.37,14,585/- within one month from today. "
As observed by this Court in the aforesaid order, the Corporation had already paid Rs.8,04,980/-
and was required to pay the balance amount of Rs.37,14,585/- to the petitioner. The Court had, accordingly, directed the respondent No.1 to pay the said amount to the petitioner within a period of one month from the date of the said order.
Mr.
R.K. Mishra, learned advocate for the respondent No.1 has placed on record a communication dated 12.8.2004 of the respondent No.1 addressed to the petitioner wherein it had been stated that the payment amounting to Rs.37,14,585/- has already been released to the registered office of the petitioner vide cheque No.739075 dated 8.8.2004. Mr. B. T. Rao, learned advocate for the petitioner also concedes that the said amount has been received by the petitioner. In the circumstances, the relief prayed for in the present petition no longer survives upon compliance of the aforesaid order dated 13.7.2004 passed by this Court pursuant to which, the principal amount has already been paid to the petitioner.
Mr.
B. T. Rao, learned advocate for the petitioner has however submitted that though the amount as claimed by the petitioner has been paid by the respondent No.1 Corporation under the interim orders of the Court, the said amount has been paid after a considerable delay. Hence, the petitioner is entitled to payment of interest on the said amount from the date of destruction till the date of payment.
From the facts noted hereinabove, it is apparent that the principal relief prayed for by the petitioner no longer survives inasmuch as the amount claimed by the petitioner has already been paid to it pursuant to the interim order passed by this Court on 13.7.2004. However, the petitioner has also claimed interest on the said amount from the date of destruction till the date of payment. In this regard it may be pertinent to note that the learned advocate for the petitioner is not in a position to trace out the claim for payment of interest on delayed payment to any statutory provision, but has claimed the same on general principles on the basis of equity. Thus, admittedly there is no statutory basis for the claim of interest made by the petitioner in the writ petition inasmuch as there is no provision in the statute imposing an obligation on the Warehousing Corporation to pay interest on the amount paid. Thus, there is no statutory or legal basis for making the claim of interest to furnish a ground for issuance of a writ of mandamus. Under the circumstances, the claim of interest does not merit acceptance. The petitioner is, however, at liberty to pursue the said claim by way of appropriate proceedings in accordance with law.
In the light of the aforesaid, nothing remains to be done in the present petition and the same is, accordingly, disposed of. Rule is discharged with no order as to costs.
[HARSHA DEVANI, J.] [R.M.CHHAYA, J.] parmar* Top