The Ahmedabad Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the customs department cannot direct the carrier on charges post 60 days.
The bench of Somesh Arora (Judicial Member) and Satendra Vikram Singh, (Technical Member) has observed that the response of the authorized carrier has been quite unclear and not as per the spirit of the Sea Cargo Manifest and Transhipment Regulations, 2018 (SCMTR).
The bench advised the carrier to follow the Regulations in correct spirit so as to avoid any similar issue in future and not to indulge in wavering responses in their correspondence. The Department should also note that proviso to Regulation 10(1)(l) gives discretion to authorized carriers to demand or not to demand charges after 60 days and therefore, the Department should not issue any directions/order in derogation of discretion.
The appellant M/s. ASR India Pvt Ltd. (Shipping line) were issued a show cause notice by the Principal Commissioner, Customs House Mundra for violation of Regulation 10(1)(l) and 10(1)(m) of the Sea Cargo Manifest and Transhipment Regulations, 2018 (SCMTR) and it was proposed to revoke their authorised carrier registration under Regulation 11 and 12 of the SCMTR, 2018 besides imposition of penalty in terms of Regulation 13 of the said Regulations.
After receipt of the representation from the appellant, the adjudicating authority decided the show cause notice vide impugned order by which he revoked authorised carrier registration of the appellant in the jurisdiction of Mundra Customs with effect from 08.04.2025. The appellant was asked to handover import/export containers laden with goods or empty containers arrived at Mundra port or CFS prior to 08.04.2025. Also, a penalty of Rs. 50,000/- was imposed on the appellant under Regulation 13 of the SCMTR, 2018.
Aggrieved with the above order the appellant filed an appeal before the Tribunal. They also filed Miscellaneous application for Stay on operation of the order. The Tribunal granted Ad-interim Stay against revocation of carrier registration which otherwise was to be effective from 08.04.2025.
The issue raised was whether the appellant has violated Regulation 10(1)(l) and 10(1)(m) of the SCMTR, 2018.
Regulation 10(1)(l) clearly stipulates that an authorised carrier shall not demand any container detention charges for the container laden with goods detained by customs for the purpose of verifying the entries made under Section 46 or 50 of the Act, if the entries are found to be correct. Proviso to this Regulation further mentions that the authorized carrier may demand, container detention charges for the period, commencing after expiry of 60 days. This means that any waiver of detention charges beyond period of 60 days is purely a discretion of the Authorized carrier, may be a business sense or mutual negotiation between the authorised carrier and its users.
The CESTAT allowed the appeal and quashed the order.
Case Details
Case Title: ASR India Pvt Ltd Versus Customs Commissioner
Case No.: CUSTOMS Appeal No. 10401 of 2025-DB
Date: 10.06.2025
Counsel For Appellant: Paritosh Gupta
Counsel For Respondent: Girish Nair, Assistant Commissioner
