A dramatic twist has emerged in the legal battle over more than 1,000 imported vehicles stranded at the Port of Colombo, with the Court of Appeal demanding answers over what appears to be conflicting statements made by a senior Sri Lanka Customs official before Parliament and the judiciary.
The Court of Appeal has directed the Attorney General to obtain an immediate explanation from the relevant Customs official after expressing serious concern that Parliament’s Committee on Public Finance (CoPF) may have been given an account that contradicts the position presented before court.
The controversy surfaced during Friday’s hearing before a three-judge bench comprising Court of Appeal President Justice Rohantha Abeysuriya and Justices Pradeep Hettiarachchi and Frank Gunawardena. The case concerns writ applications challenging Customs’ continued detention of vehicles imported through cross-border Letters of Credit (LCs).
With the Court’s approval, a video recording of the CoPF meeting held on June 25 was played during proceedings. During that session, CoPF Chairman MP Dr. Harsha de Silva questioned an Additional Director General of Customs over the prolonged detention of imported vehicles and the reasons for delays in their release.
According to Counsel Nishan Premathiratne, appearing for one of the petitioners, the Customs official informed the parliamentary committee that a settlement was being discussed before the Court of Appeal and that the only unresolved issue related to the calculation of demurrage charges.
However, that statement sharply conflicted with submissions previously made before the Court by the Attorney General, representing the respondents, who had categorically informed the bench that no settlement discussions were underway and that the dispute was proceeding to judicial determination.
The contradiction immediately drew the Court’s attention. The bench observed that if Parliament had indeed been misinformed, the implications could be extremely serious, even raising questions of contempt of court. While refraining from making any findings at this stage, the judges ordered the Attorney General to summon the relevant Customs officials and secure an urgent clarification. The matter has been fixed for July 23.
The inconsistency has also strengthened the petitioners’ broader case that Customs lacks a lawful basis to continue withholding the vehicles while presenting different explanations to different institutions.
The substantive dispute extends beyond conflicting statements. Petitioners argued that Customs is now releasing certain vehicles without requiring certification of import documents, despite previously relying on the absence of such certification to justify detaining shipments.
Lawyers further contended that the Gazette Notifications governing imports do not define “cross-border Letters of Credit,” making Customs’ selective interpretation legally questionable. They maintained that all forms of Letters of Credit should be treated uniformly, consistent with long-standing practice.
Another key argument focused on Customs’ own valuation procedures. Petitioners submitted that Customs routinely accepts export documentation from the country of origin when assessing duties, making its current challenge to the validity of cross-border LCs inconsistent with its established practices.
Following several days of oral arguments, the Court directed all parties to file written submissions before reserving judgment until September 18. The proceedings will resume on July 23, when the Attorney General is expected to provide the Court with a formal explanation regarding the disputed statements made before Parliament.
As the legal battle intensifies, the Court’s latest intervention places Sri Lanka Customs under unprecedented judicial scrutiny, with the outcome likely to have significant implications for transparency, accountability, and the future of vehicle import regulation in Sri Lanka.