TMI Blog2000 (3) TMI 1116X X X X Extracts X X X X X X X X Extracts X X X X ..... irst imported into India in 1988 without a bill of entry being filed for it as required under Section 46 of the Customs Act, 1962 (hereafter referred to as the Act for short). After 29.12.1988, it was once again, after long absence brought into designated area without filing a bill of entry and without payment of duty. It was therefore liable to confiscation and the applicant before us liable to penalty for the reason that despite knowing to the contrary they did not comply with the Customs formalities or paid the duty. 4. The contentions raised by the Advocate on behalf of the applicant are summarised below. When the rig was imported and first brought to India in 1988, its presence was indicated in the manifest filed for the ship MV Mighty Servant as a towed rig Trivent. There was a reference to it in light dues receipt at the relevant time it was exempted from duty under Notification 516/86. The rig was on contract with the Oil Natural Gas Commission (ONGC for short) for various periods up to 1998. In December 1998 after an absence, it was again on contract with ONGC. It was a practice in the department not to insist upon a bill of entry for such drilling rigs and as many ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 14.06 million. These values have not at all been considered. 7. The Bombay High Court, during the pendency of the proceedings before the Commissioner, had permitted the rig to be operated till March 15, 2000. Permitting i not to operate during the pendency of the adjudication would cause irreparable harm not only to the applicant but to the ONGC. The order of the Commissioner itself thus is manifestly illegal and would cause grave hardship and stay of it operation is prayed. 8. In response to enquiries which were made at the earlier date of hearing, it was stated that the ONGC was willing to undertake to give four days' notice before movement of the rig from the designated area to another designated area. The rig in any case would not be moved after the middle of May when the monsoon set in. Its movement across high seas out of India would entail atleast two weeks preparation and would require specialised craft. Such a movement was not likely to arise in any case since its contract with the ONGC subsisted till 28.12.2000. The applicant in any case would undertake to inform the department well in advance of its movement outside India. It is willing to give bank guaran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to the applicant who were earning sizable daily income from the deals. The Customs formalities have been complied with in a number of other rigs, details of which have been intimated. It was clearly indicated the rig as cargo at Singapore. Remy Baizan, District Manager of the applicant, had in his statement admitted its intention not to comply with the Customs formalities. 11. The value of US$ 49 million for the rig was declared by the applicant with the ONGC. The contention that this was necessitated by commercial considerations unconnected with the goods has not been substantiated. The applicant's undertaking not to remove the rig has to be viewed in the background of Remy Baizan's District Manager's conduct, after undertaking not to leave the country without intimation during the investigation, he did so. 12. There is therefore no case for waiver of deposit of penalty or stay of operation of the order of the Commissioner. 13. For the purposes of entertaining the appeal, we are only concerned with the deposit of penalty of ₹ 5.00 crores. However, the goods are still under seizure and the deposit of redemption fine also therefore does not arise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions of the Act relating to filing of the bill of entry etc. would have applied to the rig whenever it entered the designated area and whenever it left such an area. Therefore, confiscation of the vessel for ordering of which mens rea is prima facie not applicable would appear to be in order. 16. The next aspect to be considered would be the duty liability. Although, neither side raised this point, we put it to the learned Advocate for the department that, even if duty was payable, draw back would be available under Section 74 of the Act, when the rig left the designated area. After some discussion, it emerged that the draw back could be around 85% taking into account the extend [extent] of use of the duty payable. We hastened to add that this was stated to be a figure off the cuff and appreciate the reservation expressed by Mr. Sethna that he would require reasonable time to quantify this amount with greater precision. The question would also arise as to whether, when the place and point of import was known to the department, Section 125(2) of the Act apply at all, in the light of the decision of the Tribunal in HCL HP Ltd. v. CC. 17. We appreciate the point made by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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