Of all the provisions that protect importers from unjust financial losses caused by customs investigations, Regulation 6(1)(l) of the Handling of Cargo in Customs Areas Regulations, 2009 (HCCAR 2009) is perhaps the most powerful. It mandates — without exception — that a Customs Cargo Service Provider (CCSP) shall not charge any rent or demurrage on goods that have been seized, detained, or confiscated by designated customs officers.

The provision exists because the CCSP is in a structurally advantageous position: it holds the importer’s goods and can refuse delivery until charges are paid. If those charges have accumulated because customs itself detained the goods for an investigation — an investigation that may ultimately find the importer innocent — it would be deeply unjust to saddle the importer with those charges. Regulation 6(1)(l) is the legislative response to this injustice.

This article explains HCCAR 2009’s legal basis, the full scope of Regulation 6(1)(l), the triggering conditions, how to obtain and enforce a detention certificate, what happens when the CCSP refuses to honour the certificate, and the consequences of non-compliance.

Legal Basis of HCCAR 2009

HCCAR 2009 was issued vide Notification No. 26/2009-Cus (NT), dated 17.03.2009, under the powers conferred by Sections 141(2) and 157 of the Customs Act, 1962. Section 141(2) empowers the Board to make regulations for the conduct of persons engaged in the business of importing or exporting goods or managing or running a public or private warehouse, or engaged in any other work connected with the clearance of goods at a customs station.

HCCAR applies to all customs cargo service providers — CFS operators, ICD operators, port trusts, air cargo complexes, and any other entity approved as a CCSP by the Commissioner of Customs. The Regulations were significantly amended by the HCCAR Amendment Regulations, 2024.

The Full Text and Structure of Regulation 6

HCCAR 2009 Regulation 6(1)(l) sets out a comprehensive list of obligations that every CCSP must comply with in respect of goods in their custody. Clause (l) of Regulation 6(1) provides:

“not to charge any rent or demurrage on the goods seized or detained by an officer of Customs [not below the rank of Superintendent of Customs or Appraiser or Inspector of Customs or Preventive Officer or Examining Officer] or goods confiscated by a gazetted officer of customs;”

This provision is mandatory and unqualified — there is no discretion granted to the CCSP to assess whether the seizure was justified, whether the importer was at fault, or whether the charges are commercially recoverable. The obligation arises from the fact of seizure/detention/confiscation alone.

The Triggering Conditions

For HCCAR 2009 Regulation 6(1)(l) to apply, three elements must be satisfied:

1. There must be an act of seizure, detention, or confiscation. This is a formal act by a customs officer — it is not merely a delay or a customs hold for procedural processing. The customs officer must have formally seized or detained the goods under the Customs Act (typically under Sections 110 or 111) or confiscated them following adjudication.
2. The act must be by a designated customs officer. Regulation 6(1)(l) specifically limits the qualifying officers to: Superintendent of Customs, Appraiser, Inspector of Customs, Preventive Officer, or Examining Officer. Officers of investigation agencies such as DRI and SIIB, when exercising powers as customs officers under the Customs Act, fall within this definition. This has been judicially confirmed.
3. The goods must be in the custody of a CCSP. Regulation 6(1)(l) binds only CCSPs — not shipping lines or carriers. The parallel provision for carriers is found in SCMTR 2018 Regulation 10(1)(l), which is discussed in Article 5.

Critical Point: The mere delay in customs clearance, or an administrative hold for documentation verification, does not constitute ‘detention’ for the purposes of Regulation 6(1)(l). There must be a formal, documented act of seizure or detention by a designated customs officer.

What is a Detention Certificate?

A ‘Detention Certificate’ (also called a ‘Detention cum Demurrage Waiver Certificate’) is an official certificate issued by the competent customs authority — typically the AC/DC or the officer in charge of the investigation — to the CCSP, directing them not to charge rent or demurrage on specific goods for a specified period. The certificate is the mechanism by which the waiver obligation under Regulation 6(1)(l) is communicated to and enforced against the CCSP.

The detention certificate typically contains: the Bill of Entry number and date; the container number(s); the period of detention (from date of seizure/detention); and a specific direction to the CCSP not to charge rent, demurrage, or container detention charges for the covered period.

Example from case law: In M/s. Sai Lakshmi Engineering v. Principal Commissioner of Customs (W.P.No.14370 of 2018, Madras High Court, decided 01.07.2021), the detention certificate was issued in F.No.S.Misc.11/2018-DIU, dated 25.05.2018, by the Detection Investigation Unit (DIU) of customs, certifying that the goods were detained goods and directing the CCSP not to demand detention charges as per HCCAR Reg. 6(1)(l).

The Procedure for Obtaining a Detention Certificate

The procedure for obtaining a detention certificate is not exhaustively codified in a single circular or notification, but practice and case law reveal the following steps:

4. Application: The importer or their CHA files a written application to the officer-in-charge of the investigation (DRI/SIIB/DIU or the relevant Custom House) requesting issuance of a detention certificate under Regulation 6(1)(l). The application should mention: the Bill of Entry number, container number(s), the date goods were seized/detained, and the CCSP’s demands.
5. Verification: The investigation officer verifies the facts of the seizure/detention and the period during which the CCSP is being directed not to charge.
6. Issuance: The appropriate officer (typically AC/DC or the officer who ordered detention) issues the certificate to the CCSP and provides a copy to the importer.
7. Service on CCSP: The certificate must be formally communicated to the CCSP. In many cases, the importer or customs authority serves the certificate directly on the CFS/ICD operator and the shipping line.
8. Response: Upon receipt, the CCSP is legally bound to acknowledge the certificate and waive charges for the covered period.

Common Problem: In practice, importers are sometimes caught between DRI (which conducted the seizure) and the Custom House (Bond Section), with each authority claiming the other should issue the certificate. Courts have consistently held that the responsibility lies with the investigation authority that ordered the detention. Writ petitions have been filed to compel issuance.

Enforceability of the Certificate: It is Binding on the CCSP

The CCSP has no discretion to refuse or qualify the detention certificate. It is a statutory direction under HCCAR 2009 — a regulation enacted under the Customs Act. The CCSP cannot raise commercial objections, claim contractual rights, or demand proof of innocence before honouring the certificate. This has been consistently held by courts:

• Madras HC in G.K. International v. Principal Commissioner of Customs (W.P.No.6947 of 2022, 16.06.2022, per Justice R. Suresh Kumar): The Court issued a writ of mandamus directing the respondents to release goods without levy of detention, demurrage, and container storage charges from the date of detention certificate issued by SIIB, dated 17.01.2022, in F.No.S.Misc.343/2021-SIIB. The CCSP’s refusal was struck down.
• Madras HC in M/s. Isha Exim v. Commissioner of Customs (W.P.No.26838 of 2018, decided 01.07.2021): APL India collected Rs.20,57,526.72 as container detention charges in ‘blatant violation’ of the Detention/Demurrage Waiver Certificate dated 27.10.2017 issued by the customs in F.No.S49/340/2017-Gr.1. The Court directed refund of the illegally collected charges.
• Madras HC in M/s. Sai Lakshmi Engineering v. Principal Commissioner of Customs (W.P.No.14370 of 2018, 01.07.2021): The Court held the detention certificate issued under HCCAR 2009 is a ‘reiteration of the legal position, which is binding on the Service Provider’ — relying on the Delhi HC’s earlier decision in Trip Communications Pvt. Ltd. v. Union of India (28.03.2014).
• Madras HC in M/s. R.M. Trading v. Principal Commissioner of Customs (W.P.No.6638 of 2018, 01.07.2021): Rs.38,99,383 collected by Hyundai Merchant Marine India in violation of the detention certificate was ordered to be refunded.

The Exception: Importer at Fault

There is, however, a qualification to the absolute nature of the waiver obligation. The Delhi High Court in Bhavik S. Thakkar v. Union of India (W.P.(C) 982/2015, decided 14.02.2023, 2023/DHC/001046) held that where the goods were seized and detained because of the importer’s own misdeclaration — and a penalty was consequently imposed on the importer — the CCSP (in this case, CONCOR) was entitled to refuse to waive terminal storage charges. The logic is that the detention was caused by the importer’s own wrongdoing, and the CCSP should not be forced to subsidise the importer’s misconduct.

This creates a ‘fault-based divide’ in the law, which is examined in detail in Article 6. The key distinction is: if the importer is innocent (detention was due to customs’ own action), waiver is mandatory; if the importer was at fault (misdeclaration, smuggling, penalty imposed), the CCSP may resist the waiver.

Consequences for Non-Compliance by CCSP

A CCSP that refuses to honour a valid detention certificate faces:

• Action under Regulation 13 of HCCAR 2009: The Commissioner of Customs may suspend or revoke the CCSP’s licence/approval for non-compliance with Regulation 6.
• Court-ordered refund: If the CCSP has already collected charges in violation of the certificate, High Courts have ordered refund of the collected amounts.
• Contempt: If a court has directed compliance with the certificate, further non-compliance may attract contempt proceedings.

The 2024 Amendment to HCCAR

The HCCAR Amendment Regulations, 2024 (notified December 2024) made certain amendments to the regulatory framework applicable to CCSPs. The core obligation under Regulation 6(1)(l) — prohibiting demurrage charges on seized/detained/confiscated goods — remains intact. Practitioners should verify the current text of Regulation 6(1)(l) as amended to ensure compliance with the latest requirements.

Conclusion

Regulation 6(1)(l) of HCCAR 2009 is a powerful, mandatory protection for importers whose goods are seized or detained by customs authorities. Its scope is clear: the CCSP cannot charge rent or demurrage on seized, detained, or confiscated goods. The triggering event is a formal act of seizure or detention — not a mere delay or processing hold. The mechanism is the detention certificate, which is binding on all CCSPs and enforceable through writ courts. Non-compliance by CCSPs is unlawful and courts have consistently ordered refund of illegally collected charges. The qualification for fault of the importer introduces a layer of complexity that is addressed in Article 6. Article 5 examines the parallel regime applicable to shipping lines under SCMTR 2018 Regulation 10(1)(l).

FAQ – HCCAR 2009 Regulation 6(1)(l) (Demurrage Waiver)

1. What is Regulation 6(1)(l) of HCCAR 2009?
It is a mandatory provision that prohibits Customs Cargo Service Providers (CCSPs) from charging rent or demurrage on goods that are seized, detained, or confiscated by customs authorities.

2. When does Regulation 6(1)(l) apply?
It applies only when there is a formal seizure, detention, or confiscation by a designated customs officer—not in cases of routine delay or document verification.

3. What is a detention certificate?
A detention certificate is an official document issued by customs directing the CCSP not to charge demurrage or rent for a specified period during which goods were under customs detention.

4. Who issues the detention certificate?
Typically, the officer who ordered the detention (AC/DC, SIIB, DRI, or DIU officer) issues the certificate.

5. Is a detention certificate legally binding on CCSPs?
Yes. It is a statutory direction under HCCAR 2009, and CCSPs have no discretion to refuse compliance.

6. Can a CCSP still charge demurrage despite a detention certificate?
No. Charging demurrage after issuance of a valid detention certificate is illegal and can lead to penalties, refund orders, or licence action.

7. Does Regulation 6(1)(l) apply to shipping lines?
No. It applies only to CCSPs like CFS, ICDs, and port operators. Shipping lines are governed separately under SCMTR 2018.

8. What if customs delays clearance but does not formally detain goods?
In such cases, Regulation 6(1)(l) does not apply. A formal detention or seizure order is required.

9. What should an importer do to get a detention certificate?
File a written request with the investigating customs authority, providing details like Bill of Entry, container numbers, and detention period.

10. Can courts enforce detention certificates?
Yes. High Courts regularly issue writs directing CCSPs to comply and refund illegally collected charges.

11. Is there any exception to the demurrage waiver?
Yes. If the detention is due to the importer’s fault (e.g., misdeclaration or smuggling), courts have allowed CCSPs to deny waiver.

12. What happens if a CCSP refuses to comply?
Consequences include licence suspension under HCCAR, court-ordered refunds, and possible contempt proceedings.

13. Does the 2024 amendment change this rule?
No. The core obligation under Regulation 6(1)(l) remains unchanged—demurrage cannot be charged on detained/seized goods.

14. Is a detention certificate required for waiver?
In practice, yes. It is the primary mechanism used to enforce the waiver against CCSPs.

15. Can demurrage already paid be recovered?
Yes. Courts have ordered refunds where charges were collected in violation of a valid detention certificate.

References

1. HCCAR 2009, Regulation 6(1)(l) — Notification No. 26/2009-Cus (NT) — CFSAI — https://cfsai.in/wp-content/uploads/2023/03/5.pdf
2. HCCAR 2009 — India Code — https://www.indiacode.nic.in/ViewFileUploaded?path=AC_CEN_2_2_00042_196252_1534829466423%2Fregulationindividualfile%2F&file=Handling…
3. Handling of Cargo in Customs Areas (Amendment) Regulations, 2024 — TaxGuru (2024) — https://taxguru.in/custom-duty/handling-cargo-customs-areas-amendment-regulations-2024.html
4. K. International v. Principal Commissioner of Customs, W.P.No.6947 of 2022 (Madras HC, 16.06.2022) — CaseMine — https://www.casemine.com/judgement/in/62ab6915b50db9b9d68ec12b
5. M/s. Sai Lakshmi Engineering v. Principal Commissioner of Customs, W.P.No.14370 of 2018 (Madras HC, 01.07.2021) — CaseMine — https://www.casemine.com/judgement/in/6159e3f39fca197b22b03e78
6. M/s. Isha Exim v. Commissioner of Customs, W.P.No.26838 of 2018 (Madras HC, 01.07.2021) — CaseMine — https://www.casemine.com/judgement/in/6159ea809fca197b22b03e94
7. M/s. R.M. Trading v. Principal Commissioner of Customs, W.P.No.6638 of 2018 (Madras HC, 01.07.2021) — LatestLaws — https://www.latestlaws.com/judgements/madras-high-court/2021/july/2021-latest-caselaw-12834-mad
8. Bhavik S. Thakkar v. Union of India, W.P.(C) 982/2015 (Delhi HC, 14.02.2023) — CaseMine — https://www.casemine.com/judgement/in/63f0f0f2ded2162298556a83
9. NLIU CBCL: Analysing the Conflict Between Detention Certificates and Right to Demurrage (2023) — https://cbcl.nliu.ac.in/taxation/analysing-the-conflict-between-detention-certificates-and-right-to-demurrage/
10. Waiver of Demurrage and Detention under Customs Regulations — SJ Exim (2025) — https://sjexim.services/2025/03/12/waiver-of-demurrage-and-detention-under-customs-regulations/
11. Demurrage Charges and Detention Certificates: Legal Framework — Bhatt & Joshi Associates (2022) — https://bhattandjoshiassociates.com/demurrage-charges-detention-certificate-waiver-payment/
12. Customs Cargo Service Providers under Customs Act, 1962 — TaxGuru (2024) — https://taxguru.in/custom-duty/customs-cargo-service-providers-under-customs-act-1962.html

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