The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Mumbai Bench held that the 60-day limit on waiver of container detention charges under the Sea Cargo Manifest and Transhipment Regulations did not excuse a shipping operator from its separate obligation concerning goods seized by Customs.
The bench of Ajay Sharma (Judicial Member) and M.M. Parthiban (Technical Member) has upheld the immediate suspension of assessee’s customs registration after it failed to comply with a detention and demurrage waiver certificate concerning seized copper wire.
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The dispute centred on whether the appellant/assessee, a non-vessel operating common carrier (NVOCC), could demand charges after the first 60 days despite a customs waiver certificate. Aegon relied on a proviso in the Sea Cargo Manifest and Transhipment Regulations, 2018 (SCMTR), which permits an authorised carrier to demand container detention charges after 60 days in specified circumstances. The Tribunal held that the case also involved goods seized by Customs and that the obligations under the Handling of Cargo in Customs Areas Regulations, 2009 (HCCAR), applied to the company.
The proceedings arose from the import of electrolytic tough pitch copper wire rod shipped from Jebel Ali, UAE, to Nhava Sheva in two containers. The Directorate of Revenue Intelligence investigated and seized the imported goods.
Customs subsequently issued a certificate recommending waiver of detention and demurrage charges from the date the goods were held up until their delivery. The certificate, dated March 23, 2026, with an addendum dated March 27, 2026, followed directions issued by the Bombay High Court in related proceedings. The High Court had directed Customs to issue a waiver certificate under the HCCAR and SCMTR and assist with its implementation.
According to the Tribunal’s order, Aegon did not comply with the waiver beyond 60 days. The Commissioner of Customs then ordered immediate suspension of its registration under the SCMTR. Aegon sought an early hearing and a stay of the suspension while challenging the order before CESTAT.
The assessee submitted that Regulation 10(1)(l) of the SCMTR allowed an authorised carrier to demand container detention charges once 60 days had expired. It also argued that it was registered as an “other notified carrier”, rather than an authorised sea carrier, and therefore the obligation invoked by Customs did not apply to it.
The company described the matter as a commercial dispute over charges payable by the importer. It contended that there was no loss of government revenue or systemic risk warranting suspension of its operations. It also relied on the Supreme Court’s decision in Shipping Corporation of India Limited v. C.L. Jain Woollen Mills to argue against Customs overriding contractual arrangements between the parties.
The department maintained that the waiver certificate implemented the Bombay High Court’s directions. It argued that Aegon’s failure to comply justified action by the Commissioner as the authority responsible for its registration.
The Tribunal treated that provision as limited to the specified container detention charges. It separately considered Regulation 6(1)(l) of the HCCAR, which bars a customs cargo service provider from charging rent or demurrage on goods seized, detained or confiscated by specified customs officers, subject to other applicable law. Because the goods in this case had been seized following a Directorate of Revenue Intelligence investigation, the Bench held that Aegon could not rely on the SCMTR’s 60-day proviso to disregard the waiver requirement arising under the HCCAR.
The Bench also rejected Aegon’s argument about its registration category. It found that NVOCCs fall within the stakeholders governed by the SCMTR. Referring to a Jawaharlal Nehru Custom House public notice, it further held that NVOCCs involved in handling imported or exported goods are required to comply with the HCCAR. In the Tribunal’s view, non-compliance with the HCCAR also attracted Regulation 10(1)(m) of the SCMTR, which requires an authorised carrier to abide by applicable customs laws, regulations and orders.
The Tribunal found the Supreme Court ruling cited by Aegon inapplicable because it concerned a different provision of the Customs Act and did not address the later HCCAR and SCMTR framework.
CESTAT held that the Commissioner’s immediate suspension order was legally sustainable. It also noted that the Commissioner had offered Aegon an opportunity to submit a representation after the suspension, satisfying the requirement of a post-decisional hearing in the circumstances examined by the Bench.
The Tribunal allowed Aegon’s application for an early hearing and heard the appeal itself. It dismissed the separate stay application as unnecessary in view of that hearing, and dismissed the main appeal on September 24, 2026.
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