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D.G. Karnik, J.—By this petition, the petitioner prays for a writ of mandamus directing the respondents to forthwith return to the petitioners the consignment of 500 kg of Erythromycin or in the alternative to pay to the petitioners the value thereof amounting to Rs. 14,91,500/- together with interest.
On 28th September 1987, the petitioner exported out of India 500 kg of Erythromycin Base, a bulk drug. The consignee in Hongkong observed certain variations in the specifications of the exported bulk drug and therefore rejected the goods. On petitioners request the foreign buyer returned the goods to Mumbai in original packing. On receipt of the goods, the petitioner filed a bill of entry on 15th march 1990 claiming duty free clearance u/s 20 of the Customs Act, 1962. The Assistant Collector refused to allow the duty free clearance and on 28th June 1990, issued a show cause notice to the petitioner for confiscation of the consignment. The petitioner filed an appeal to the Collector (appeals) who by an order dated 11th September 1990 remanded the matter back to the Assistant Collector. 3rd On November 1990, Assistant Collector passed an order/endorsement on the bill of entry accepting that the goods were of Indian origin. In the mean while, the goods were transferred by the Customs authorities to the bonded warehouse of the respondents 3 / 4 Air India/International Airport Authority of India. On 5th February 1991, petitioner requested for a detention certificate which was issued to the petitioner on 7th February 1991 for 301 days. The petitioners then approached respondents 3 / 4 who orally informed it that the goods had already been disposed of sometime in November 1990 by the Customs Authorities. By a letter dated 14th February 1991, the petitioner wrote to the Collector of Customs requesting him to look into the matter and also requesting for a personal meeting. No action was taken by the Customs Authorities inspite of reminders by the petitioner. The petitioner therefore, by a letter dated 14th April 1991 called upon the respondent No. 1 to deliver the goods or compensate the petitioner with the value thereof. By another letter dated 23rd April 1991, the petitioner called upon the respondent No. 3 Air India to return the goods or compensate it. By a reply dated 10th May 1991, respondent No. 3 Air India informed the petitioner that it was only acting as an agent of respondent No. 4 International Airports Authority of India and the goods were auctioned by the Customs in November 1990. As all the respondents neglected to deliver the goods which have been cleared by the Assistant Collector of Customs, the petitioner has filed this petition for writ of mandamus directing the delivery of goods or payment of the price thereof with interest.
Opposing the petition Mr. D.P. Gupta, Assistant Collector of Customs has filed an affidavit in reply on behalf of respondent Nos. 1 on 2nd January 1991. On behalf of respondent No. 3 Air India, three affidavits have been filed, one by Mr. K.U. Menon, Officiating Manager of Cargo Complex, Mr. M.P. Gonsalves, Duty Officer, Import Warehouse and Mr. J.J. Rindani, Secretary and Dy. Director (Administration).
Paragraph Nos. 6 and 7 of the affidavit of Mr. Gonsalves are material and are extracted below:
I say that as per their usual practice on or about 19/11/1990 a customs officer came to the said junk 3rd room to inspect the goods stored by the Respondent and to determine which goods were damaged beyond repair/retrieval and/or otherwise should be auctioned off and/or sold off. I do not today remember the name of the specific customs officer who thus came to the said C6. I say that as per their usual practice on or about 19/11/1990 a customs officer came to the said junk room to inspect 3rd the goods stored by the Respondent and to determine which goods were damaged beyond repair/retrieval and/or otherwise should be auctioned off and/or sold off. I do not today remember the name of Cargo complex on or about 19/11/1990. It appears that the said officer decided that all the goods lying in the junk room were damaged beyond repair/retrieval and ought to be sold or auctioned off. The 3rd Respondents responsibility in respect of goes ends at this point. Thereafter, the customs authorities decide as to which goods to auctions, and I am not aware as to what proceedings the customs authorities follow thereafter.
Ultimately, the customs officials as per their usual practice, gave me oral instructions subsequently confirmed by a letter dated 24/11/1990 which letter was personally handed over by the Customs officials to Mr. Anthony Pereira of the 3rd Respondent, that all the goods in the said Junk Room had been auctioned off, and to permit the purchaser to remove the same. Accordingly, the contents of the said Junk Room were handed over and delivered by the 3rd Respondent on 24/11/90, 27/11/90 and 28/11/90, under 3 gate passes. Each gate pass inter alia states that the goods 2nd covered thereby were disposed off by the Respondent. Each gate pass was signed by a customs officer, a representative of the 4th Respondent, and the 3rd said Mr. Anthony Pereira on behalf of the Respondent. I say that the said goods, including the suit goods were taken out of the possession and custody of the 3rd Respondent and loaded on to trucks as per the said gate passed under the orders and directions of the customs authorities and in the presence of the said Customs Officer who signed the said gate passes. Annexed hereto and marked Exhibits C, D and E respectively are copies of the said gate passes dated 24/11/90, 27/11/90 and 28/11/90.
Photo copies of three gate passed bearing the signature of the Customs Officers permitting transportation of the goods along with a photo copy of the register showing that the goods covered under the consignment in question were transported out are annexed to the affidavit of Mr. Gonsalves. No affidavit in reply has been filed by the Customs Authorities denying the averments in the affidavit of Mr. Gonsalves. Affidavit of Mr. Gonsalves and the documents annexed thereto clearly show that the goods in question were auctioned by the Customs Authorities and were permitted to be removed for being delivered to the auction purchaser. Counsel for the respondents stated before us that in the facts and circumstances of the case, it is not possible to deliver the goods to the petitioner. The petitioner is the owners of the goods. The clearance of the goods was permitted by the Customs Authorities and even a detention certificate was issued. The goods were kept in the custody of the respondent No. 3 or 4 as the case may be by the Customs Authorities as their agent and in a bonded warehouse. In the circumstances, the respondent Nos. 1 and 2 are liable to value of the goods to the petitioner.
In paragraph Nos. 28 and 30 of the petition, petitioners have stated the value of the goods to be Rs. 14,91,500/-. That value has not been disputed in the affidavit filed by the respondents. Since the petitioner had been demanding the delivery since 1990 and in the alternative it had also requested to the respondents to pay the value of the goods which has been denied for over 18 years, in our opinion the petitioner is also entitled to an interest. However, we are not inclined to granted interest at 18% as claimed by the petitioner but are inclined to award interest at a market rate of 6%.
For the reasons mentioned above petition is allowed and the respondents 1 and 2 are directed to pay to the petitioner Rs. 14,91,500/- together with interest thereon at 6% p.a from 14th February 1991 (the day on which the petitioners approached the Collector of Customs) till payment and costs of this petition. Rule made absolute to the extent indicated above.