MUMBAI PORT TRUST versus MIS. SHRI LAKSHMI STEELS AND ORS. ETC.

Citation: [2017] 11 S.C.R. 470 · Decided: 27-07-2017 · Supreme Court of India · Bench: MADAN B. LOKUR · Disposal: Appeal(s) allowed
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Judgment (excerpt)

A 
[20 l 7] 11 S.C.R. 470 
MUMBAI PORT TRUST 
v. 
MIS. SHRI LAKSHMI STEELS AND ORS. ETC. 
(Civil Appeal Nos. 9831-32 of 2017) 
B 
JULY27,2017 
c 
[MADAN B. LOKUR AND DEEPAK GUPTA, JJ.] 
Major Port Trusts Act, 1963: 
ss.47A and 53 - Detention of guods uf imporrers - By the 
Customs Departme/l/ at the instance of Directorate of Revenue 
lmelligence (DR!) - Demand of demurrage! detention charges by 
the Port Tnist and Shipping Line - Demand challenged - Mala fide 
alleged against the ofjicials of DR! - High Court held that the 
importers were not liable to pay demurrage charges to the Port 
D 
trust nor were liable to pay the detention charges to the Shipping 
Line; that DRE/Customs authorities were liable to pay the detention 
charges and that Port Tnist was 1101 entitled to charge demurrage 
in view of Regulation 6(1) of 2009 Regulations - Port Trust was 
directed to waive the demurrage charges - On appeal, held: Mumbai 
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F 
Port Trust has the power and authority to levy rates includi11g 
demurrage as fl.red by Tiiriff Authority ui.f.47A - The right is not 
affected by the provisions of Customs Act or by the 2009 Regulations 
in view ofs. 160(9) of Customs Act -Even if the importer is not at 
fault, it is importer alone who is liable to pay the demurrage charges 
- Su fi1r as detention charges are concerned, it bdng a private 
contract between the importer and carrier (Shipping Line), importer 
is liable to pay the same - DR!!Customs Authorities can be directed 
to pay detemionl demurrage charges on(v whe11 it has been proved 
that the action of DRE/Customs Authorities was mala fide - !11 the 
presellt case allegation of mala fide has not been proved - Even if 
importer feels that it has been 111y11stly dealt with, it must clear the 
G goodv by paying the due charges and then claim reimbursement 
from Customs Authority - The importers are free to approach the 
Port Trust in terms of s.53 - Customs Act, 1962 - s. 160(9) -
Handling of Cargo in Customs Areas Regulations, 2009 - Regn. 
6(1). 
H 
470 
MUMBAI PORT TRUST v. MIS. SHRI LAKSHMI STEELS 
471 
Allowing the appeals, the Court 
A 
HELD: 1.1 The question whether the. Port Trust is a 
custodian of the .Customs Department u/s. 45(1) of the Customs 
Act, 1962, is pending for considscration before this Court in 
another case. Therefore, this issue cannot be addressed. Even 
assuming that Mumbai Port Trust is a custodian or cargo service 
B 
proviclcr, the question that arises is whether Handling of Cargo 
in Customs Areas Regulations, 2009 apply to the Mumbai Port 
Trust. These Regulations have been framed u/s.157 of the 
Customs Act. Section 160(9) of the Customs Act clearly lays 
down that nothing in the Act shall affect the power of the Port 
Authority in a Major Port, as defined in the Major Port Trusts 
Act, 1963. The Mumbai Port Trust (appellant) is a major port. 
(Paras 28, 29][49-A-H; 491-A-B) 
c 
1.2 The Mumbai Port Trust has the power and authority to 
levy rates including demurrage us fixed by the Tariff Authority 
uncler Section 47 A of the Major Port Trusts Act. This right of D 
the Port Trust is not affected either by the provisions of the 
Customs Act or by the Regulations of 2009. Section 160(9) of 
the Customs Act clearly lays clown that the provisions of the 
. Customs Act shall not in any manner affect the constitution and 
powers of any port authority in a major port. This will include the 
E 
right of the major port authority that is a Major Port Trust to levy 
and charge rates uncl clcmurragc. 2009 Regulations arc framed 
under the Customs Act. Regulations arc in the nature of 
subordinate legislation. There can be no manner of doubt that 
subordinate legislation that loo a legislation framed by a Board 
unclcr the Customs Act cannot in any manner affect the power 
and authority of the Major Port Trust, statutorily vested in it. 
(Paras 30, 31)[491-B-D] 
F 
1.3 Neither the Regulations nor the provisions of the 
Customs Act can impinge or in any manner affect the statutory 
power of the Major Port Trusts to levy rates under the Act. In 
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fact, the Authority that framed the Regulations was itself aware 
of this because Regulation 6(1) itself begins with the words"" 
subject to any .other law for the time being in force". It is, 
therefore, obvious that the Regulations are subject to any other 
law including the Major Port Trust Act. Therefore, these H 
472 
SUPREME COURT REPORTS 
(2017] 11 S.C.R. 
A Regulations cannot in any manner affcctthe right
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