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Issues:
- Appeal against the order of the Collector of Customs (Appeals) regarding remission of duty on goods lost in transit. - Interpretation of Section 23 of the Customs Act for remission of duty. - Applicability of remission of duty under Section 23 for warehoused goods. - Responsibility for goods lost during transit. - Consideration of goods found short before transport in the remission of duty. Analysis: 1. The appeal was made against the order of the Collector of Customs (Appeals) concerning the remission of duty on goods lost in transit. The case involved the import of Polyether Polyol, TDI 80, and Silicone compound in drums, which were bonded in Bombay. Upon arrival, some drums were found rusty and leaking. A survey revealed shortages in TDI and Polyether Polyol. The importers requested transfer of goods to Delhi without physical bonding, resulting in further shortages upon arrival in Delhi. The Assistant Collector directed payment of duty on the losses detected during rewarehousing, leading to the appeal before the Tribunal. 2. The interpretation of Section 23 of the Customs Act for remission of duty was a key issue. The appellants argued that remission should be granted even for warehoused goods under Section 23, citing a judgment. They contended that duty payment was not a prerequisite for claiming remission. The Collector of Customs (Appeals) interpreted "remit" as the return of duty already paid, which was challenged by the appellants. They asserted that Section 23 allows remission not only for duty return but also for not demanding duty due on losses. 3. The applicability of remission of duty under Section 23 for warehoused goods was debated. The appellants argued that even for goods removed under a transit bond, remission should be available as they remained in Customs custody. They highlighted a previous decision supporting this stance. The Collector of Customs (Appeals) cited the importers' failure to take precautions before transport as grounds for rejecting remission, which the appellants disputed, emphasizing that they had no authority to alter goods in transit. 4. The responsibility for goods lost during transit was a significant aspect of the case. The Departmental Representative supported the Collector's order, citing the transfer of goods under Section 67 of the Customs Act. He argued that the importers were obligated to transport the goods despite damages noted during the survey. The Tribunal considered the arguments from both sides, acknowledging the damages noticed before transport and the importers' decision to proceed with the transfer despite initial concerns raised by the transporter. 5. The consideration of goods found short before transport in the remission of duty was crucial. The Tribunal noted shortages of TDI and Polyether Polyol detected in Bombay before transport, which were not covered by the bond executed for transport. While upholding the responsibility of importers for losses during transit, the Tribunal directed the Assistant Collector to revise the duty demand by reducing the duty on the shortages noticed in Bombay before transport. The appeal was rejected with this modification.
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