TMI Blog2012 (9) TMI 643X X X X Extracts X X X X X X X X Extracts X X X X ..... f 2002 - - - Dated:- 21-6-2011 - Harsha Devani and R.M. Chhaya, JJ. REPRESENTED BY : Shri Rakesh Gupta, Advocate for M/s. Trivedi and Gupta, for the Petitioner. Ms. Amee Yajnik, Sr. Standing Counsel, for the Respondent. [Judgment per : R.M. Chhaya, J.(Oral)]. By way of this petition under Articles 226 and 227 of the Constitution of India, the petitioners have challenged communication dated 31-12-2001, whereby the respondent No. 3 herein directed the petitioners to observe customs procedure as prescribed under the law and file Bill of Entry under S. 46 of the Customs Act, 1962 (hereinafter referred to as the Act for the sake of brevity) for the vessel named M.V. GLORIA KOPP which was purchased by the petitioners in auction from respondent No. 5, further informing the petitioners that the customs duty is required to be collected under Chapter CTH 8908. 2. The facts as per the record of this petition are as under. 3. That the petitioner No. 1 is a registered partnership firm engaged in the business of ship breaking and petitioner No. 2 is Managing Partner of petitioner No. 1. 4. Respondent No. 5 Commissioner of Customs, Chennai floated tender for sale of con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the same was being sold by tender by the custom authorities no custom duty will be charged on sale from the purchaser as per clause 11 of the condition of sale annexed to the tender notice. Copy of the said communication was sent by respondent no. 5 also to respondent no. 1 as well as respondent no.3 herein. In response to the letter dated 26-12-2001 addressed to respondent no.3 herein requesting to permit the petitioner to beach the vessel at Alang the respondent no. 3 herein vide impugned communication dated 31-12-2001 informed the petitioners that Circular No. 44/97 would be applicable to those vessels which exclusively carry coastal goods and ply as coastal vessels only and same would not be applicable for vessels which are converted from foreign run to coastal run and vice versa. The petitioner firm was further informed that the Notifications mentioned therein indicate that the exemption would be available to Ocean going vessels and not to vessels imported for the purpose of breaking and therefore opined that the petitioner is required to pay customs duty under CTH 8908. 7. The petitioner on receipt of the said communication from respondent no.3 approached respondent no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 46 of the Act. Relying upon the judgment of the Apex Court in the case of Union of India v. M/s. Jalyan Udyog, 1993 (68) E.L.T. 9 (S.C.) as well as the judgment of CEGAT, New Delhi in case of M/s. Mustan Taherbhai v. Collector of Customs, 2000 (125) E.L.T. 1001, it is contended that the petitioner firm is required to pay customs duty as per Entry 5908 of of Customs Tariff Act, 1975. It is further contended on behalf of the respondent that condition no. 11 attached with the tender notice by respondent no. 5 would not in any manner oust the applicability of law and such a condition would not create an exception or estoppel against the statute. It is further contended that the petitioner therefore cannot take shelter of the said condition for customs duty as the vessel is to be beached for breaking up at Alang port. 11. Heard Mr. Rakesh Gupta for M/s. Trivedi Gupta for the petitioners and Ms. Amee Yajnik for respondent nos. 1 to 4. 12. It is worthwhile to note that Ms. Yajnik appearing for respondent nos. 1 to 4 has stated before the Court that she has received written communication from respondent no.5 i.e. Assistant Commissioner of Customs (Warehouse and Disposal), Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gistered at Panama and, therefore, is covered under the definition of word goods as well as import as defined under the Act and, therefore, submitted that the petitioners are not entitled to any exemption as claimed for and that they are required to follow the procedure as envisaged under Section 46 of the Act. It was further argued that the petitioners are amenable to jurisdiction of respondent no. 3 and liable to pay customs duty as per Chapter 8908. Ms. Yajnik further reiterated that condition no. 11 is stipulated in contract between respondent nos. 5 and the petitioners and the same would not absolve the petitioners from liability arising under the Act. It was further submitted that condition existing in a contract would not operate as estoppel against the statute. Ms. Yajnik further submitted that the petition is devoid of any merits and the same deserves to be dismissed. 16. Before dealing with the submissions made by both the sides it would be necessary to refer to the relevant provisions of the Customs Act which are as under : (22) goods includes - (a) vessels, aircrafts and vehicles; (b) stores; (c) baggage; (d) currency and negotiable i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f any, relating to the imported goods. (5) If the proper officer is satisfied that the interests of revenue are not prejudicially affected and that there was no fraudulent intention, he may permit substitution of a bill of entry for home consumption for a bill of entry for warehousing or vice versa. 126. On confiscation, property to vest in Central Government. - (1) When any goods are confiscated under this Act, such goods shall thereupon vest in the Central Government. (2) The officer adjudging confiscation shall take and hold possession of the confiscated goods. 17. The short question therefore which arises for consideration in this petition is as to whether the petitioners are required to follow the procedure as prescribed under Section 46 of the Act for the vessel which was confiscated under the provisions of the Act and which had vested in the Central Government and put to auction sale by respondent no. 5 as property of the Central Government. 18. It is an admitted position that the said vessel was confiscated under the provisions of the Act by respondent no. 5 and by tender notice Annexure-B to this petition the same was put to sale as a confiscated good at Chen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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