Retention of goods after arriving at Port because of a civil dispute in title of goods

 “X” an importer in India has given cashew nuts supply order to a shipper in Ghana and cargo also shipped. During the course of transit, the said Ghana exporter had transferred the title in favour of “ Y”.  “Y” is holding few typed set of papers and draft copy of the bill of lading. The goods have since arrived in India “X” had presented the necessary papers for clearing the goods.

At this stage “Y” requests Customs Department not to release cargo to ”X”. “Y”’s request was not accepted by the Customs Dept. Challenging the same “Y” files writ petition in High Court. Is he succeed? 

No. “X” is the original importer. It may be true that “Y” may hold certain documents and communications. It is to be noted that all the legally tenable original documents are only with “X”.

As per Section 49 of the Customs Act 1962, the Customs authority cannot retain the goods beyond a period of 60 days. The Customs authorities are not concerned with the civil claims which “Y” may have against the foreign exporter.

As far as the customs is concerned, they have no difficulty in releasing the goods to “X” , as he has complied with all the formalities.

The foreign exporter may have given a rapid and unsympathetic dismissal of business of “Y” and “Y” may be misled by the foreign exporter.But that cannot be a ground for directing the Customs to retain the goods. The Customs Dept cannot retain the goods, till the issue is decided by the civil Court.

“Y” do not have any claim against “X”. It is seen that there was transaction only between ”Y” and the foreign exporter also the foreign exporter is not before Indian Court.

The goods are in perishable nature and keeping them in the custody of the Customs will only make the items lose their value and also cause loss to “X” & no useful purpose will be served in keeping the matter pending. Hence writ petition of "Y" dismissed.

Relevant sections : 49 & 149 of Customs Act 1962

M/S. VIGNESWARA EXIMS, VERSUS THE ASSISTANT COMMISSIONER, MINISTRY OF FINANCE: DEPARTMENT OF REVENUE, 2. M/S. KRISENTER IMPEX PVT. LTD., MADRAS HIGH COURT decided on August 28, 2020

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