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Enjoining order on Customs

by Indeewara Thilakarathne

Colombo Additional District Judge L. S. Abegunaratne issued an enjoining order restraining the Sri Lanka Customs and its officers from encashing a bank guarantee issued by Bank of Ceylon (BoC) to Citizens Garments Manufacturers to import textiles. The case was filed to recover the Rs. 36,599,850 loss allegedly caused by customs action.

The plaintiff, Citizen Garments Manufacturers has cited the Attorney General as the defendant.

The plaintiff states that they received an order to manufacture 7,500 women's dresses on or about March 1989 as a part of a standing order.The plaintiff forwarded an application on March 29, 1989 to the Ministry of Textile Industries for an import licence to import raw material. The Ministry had approved on foreign exchange involved basis.

Accordingly, Adam Akbar Company of Singapore placed an order with Shameema Trading Company to import two containers containing 405 bales of textiles.The two containers arrived in Sri Lanka on or about April 1989.

The plaintiff states that the goods were initially examined by the Intelligence and Investigation Branch of the Sri Lanka Customs after submission of import entries on April 4, 1989.

The goods were then referred to the Director (Bonding). Later, the two containers were seized and detained by the Preventive Department.

The plaintiff states that the Director of the plaintiff company M. L. Fouz in a letter on May 10, 1989, had protested against the said re-examination and requested the Director General to appoint a senior impartial officer for re-examination.

The plaintiff was later informed by a letter on May 30, 1989 that the consignment could not be released for bonding following an advice by the ministry secretary.

After the delays, the re-examination of the consignment was carried out on August 11, 1989.

The plaintiff states that after a long detention, the Sri Lanka Customs agreed to release the consignment on payment of full duty. However the order was not carried out.

The Sri Lanka Customs commenced an inquiry on November 22,1989 and the plaintiff Company Chairman M. L. Fouz and Director S. M. Najmudeen participated in the inquiry. The inquiry held for several days concluded on December 1990.

The inquiry was temporarily stopped after the death of the inquiry officer M. Jayatilaka Banda. The inquiry was re-commenced on October 6, 1997 and was conducted by R. Suntharmoorthy. The inquirer retired before the conclusion of the inquiry and Tilak Perera (Additional Director Customs) took over.

Later the inquring officer Tilak Perera had ordered to release the goods either for re-export or to clear it on payment of duty and other levies.

The plaintiff states that the action of the Sri Lanka Customs had incurred the plaintiff a loss of Rs. 36,599,850.

The plaintiff states that if the Sri Lanka Customs encash the bank guarantee in the Bank of Ceylon it would cause further loss and damage to the plaintiff.

Therefore, the plaintiff urged the Court to recover the Rs. 36,599,850 together with the interest and to restrain Sri Lanka Customs from encashing the bank guarantee placed on, to release the goods in the Bank. Gowry Sangary Thavarasa made the application for the plaintiff.

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Copyright 2001 The Associated Newspapers of Ceylon Ltd.
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