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Dated: 09.04.2025

Punjab and Haryana High Court- The customs authorities failed to amend the IGM despite having legal authority under Section 30(3) of the Customs Act

The Punjab and Haryana High Court has ruled in favor of M/s Prenda Creations Pvt. Ltd., granting a full refund of customs duty and compensation after a prolonged delay led to the spoilage of a perishable consignment of imported kiwis. The decision in CWP No. 9301 of 2023, pronounced on April 4, 2025, underscores the critical importance of prompt customs clearance for perishable goods and enforces accountability for procedural lapses by customs officials and shipping agents.

Background:

Prenda Creations imported four containers of kiwi fruit from Dubai with the final delivery point marked as ICD GRFL, Ludhiana. However, due to incorrect filing of the Import General Manifest (IGM) by the shipping line, the cargo was routed to Mundra Port. Despite repeated requests and documentary proof indicating Ludhiana as the destination, customs authorities refused to amend the IGM or allow the filing of a manual Bill of Entry at Ludhiana.

Court Intervention:

Faced with the urgency of clearing perishable goods, Prenda Creations approached the High Court seeking relief. Through multiple interim orders starting from May 9, 2023, the Court directed:

• Amendment of the IGM to reflect the correct destination.
• Transshipment of goods from Mundra to Ludhiana.
• Filing of manual Bill of Entry at Ludhiana.
• Final clearance of goods after health and phytosanitary inspections confirmed the consignment’s compliance.

Despite the court’s repeated interventions, delays from customs authorities and the shipping company led to significant spoilage. Inspection reports confirmed that the majority of the kiwis had deteriorated by the time they were released on August 1, 2023.

Final Judgment:

The High Court found the customs authorities and shipping company at fault for failing to act promptly and comply with court directives. It held that:

• The delay violated the importer’s right to timely clearance.
• The customs authorities failed to amend the IGM despite having the legal authority under Section 30(3) of the Customs Act.
• The perishable goods became commercially valueless due to administrative apathy.

Citing principles of natural justice and the doctrine against unjust enrichment, the Court directed:

• Full refund of customs duty paid under protest.
• Compensation for the loss of goods valued at approximately ₹66.79 lakhs.

Legal Significance:

This case sets a precedent for holding customs authorities and shipping lines accountable for delays in processing perishable goods. It reaffirms the judiciary’s role in ensuring government agencies uphold their duties, especially when failure results in commercial losses to law-abiding businesses.

Conclusion:

The ruling serves as a strong reminder that procedural rigidity and negligence cannot override fairness and commercial reasonableness. Businesses dealing in perishables must ensure rigorous documentation, but this case also emphasizes the need for responsive and responsible customs facilitation in global trade.

In case you face any issues related to Indirect Tax-Customs, GST, Foreign Trade Policy (FTP), Arbitration matters and Central Licensing and related advisory matters in India then please feel free to get in touch with SJ EXIM Services.

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Source: Punjab and Haryana High Court

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