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2015 (1) TMI 752 - AT - CustomsDuty demand - Provisionally released goods - Imposition of penalty - Penalty on CHA - Held that:- At the time of original importation and assessment, the appellant had furnished invoices, packing lists, bill of sale and certificate from the Indian Register of Shipping. Further the goods were also examined on first check basis by the customs authorities by boarding the vessel. Therefore, it cannot be said that the Customs officers did not know what the goods under import were, that is, whether it is only a mere supply vessel or it is also capable of anchor handing. Further, the certificate issued by the Indian Register of Shipping clearly described the class of the vessel as tug/supply vessel. - towing capability of the vessel was clearly indicated in the certificate issued by the Indian Register of Shipping. Further in the bill of sale which was submitted along with import documents, it is clearly shown that the vessel is an anchor handling tug/supply vessel. Therefore, it cannot be said that the assessing authority did not know the nature of the vessels under importation. Even in the Lloyds register which is mentioned in the Indian Register of Shipping, the vessel is shown as offshore tug/supply ship. Therefore, if the department wanted to classify the vessel under CTH 8904, they should have done the same when the bills of entry were filed along with other import documents for the purposes of assessment which they failed to do. In the appellant's own case the lower appellate authority had classified the anchor handling tug/supply vessel under CTH 89019000 as a cargo vessel. This order of the lower appellate authority was not challenged by the Revenue and had attained finality. In these circumstances, the appellant could have entertained a bona fide belief that the goods under importation merited classification under CTH 8901. Appellant had furnished the requisite particulars as envisaged under the law at the time of assessment of the goods. The vessels were also boarded and examined by the Customs and therefore, it cannot be contended that the appellant had suppressed any information. Since the show-cause notices have been issued only in 2012 in respect of the imports made in 2008 and 2009, the demands are clearly time barred and therefore, the question of confirming differential duty would not arise at all. As regards the argument that since one of the vessels were seized and confiscated and allowed to be redeemed, there is no time limit for demand of duty, we do not subscribe to this view. As regards the payment of duty under section 125 at the time of redemption, the same would arise when no assessment had been done earlier. In any case, in the present case the goods have been confiscated under section 111(m) of the Customs Act. Since we have already held that there was no mis-declaration on the part of the appellant and confiscation under the said section is not justified, the question of giving any option of redemption or payment of duty at the time of redemption would not arise at all. Consequently, the penalties imposed on the appellant and its official are also not sustainable in law. As regards the penalties imposed on the CHA, we find no justification for such an imposition. The CHA had acted based on its understanding of the law and on the basis of the documents given, had classified the vessels under CTH 8901. We also note that the CHA had specifically asked for assessment on first check basis, that is examination first and assessment later which was also acceded to. In these circumstances, the CHA could not be said to have aided or abetted evasion of duty by the importer. Therefore, imposition of penalties on the CHA and its official is clearly unsustainable in law. - Decided in favour of appellant.
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