9911796707
TMI Blog2013 (3) TMI 407X X X X Extracts X X X X X X X X Extracts X X X X ..... ding confiscation of scrap and imposition of penalty on the appellant is legally correct in the facts and circumstances of this case?" 3. The appellant is in the business of providing port related services. For such business, the appellant-company had purchased four barges. Such barges required periodical repairs. During such repairs, several parts of the barges would have to be replaced, generating substantial scrap. The department, on visit by the officers of the preventive division carried out at the site of the repairers, noticed that 40 metric tones of iron scrap valued at Rs. 3,60,000/- was lying. Such scrap was seized on 24-8-2003 on the premise that same was cleared without payment of customs duty. A show cause notice came to be issued on 28-1-2004. In such notice, on the premise that such scrap was exigible to customs duty, despite which the same was cleared without payment, the assessee was called upon to show cause why the same should not be confiscated under the provisions of Section 111 of the Customs Act, 1962 and also penalty under Section 112 of the Customs Act be not imposed. 4. The assessee filed a reply to the notice on 22-3-2004. It was pointed out that the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p. He observed that just because the barges after repairs were again put to use would not mean that such repairs can be allowed without following procedures laid down in the Customs Act, 1962. He held that iron waste and scrap valued at Rs. 3,60,000/- during the course of repair of imported barges was dutiable under the Tariff Heading No. 7204 of the Customs Tariff Act, 1975. Relevant portion of his order reads as under : "14. I also find that in the present case it is not disputed that who was the original importer of all the barges whether M/s. DOSA or M/s. Bedi Shipping Ltd. In the instant case as deposed by Shri Arvind K. Shah, Director of M/s. Bedi Shipping Ltd. as well as repairer of the said barges Shri Manibhai K. Padhiar and Shri Keshubhai K. Padhiar of M/s. Padhiar Hi-Tech Pvt. Ltd. in their statements dated 22-8-2003, 22-8-2003 (sic) and 24-8-2003 respectively that all the four barges were of foreign origin i.e. Russian repaired at Rozi Dry Dock Area and Scrap Generated during the repairing were removed from the Customs Area. As per the provision of Notification 21/2002-Cus., dated 1-3-2002 if the vessels are intended to be broken up after their importation, the im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 10 Mts lying on jetty area of Rozy Pier Port were not placed under the seizure. Therefore, argument put forth by M/s. Bedi Shipping Ltd. that in any case iron scarp are also lying in the Sikka Dry dock area, which is within the Customs Area is also far from the truth. Panchnama dated 24-8-2003 is very much specific in this regard and seizure of iron scrap were from the private premises and not from the Customs Area......... 28. I also find that seized iron waste & scrap valued at Rs. 3,60,000/- generated during the course of repairing of imported barges are dutiable under tariff heading No. 7204 of the Customs Tariff Act, 1975 being an imported goods M/s. Bedi Shipping Ltd. had unloaded the same at a place other than declared for the purpose and removed without supervision of the proper officer as laid down under Section 33 and Section 34 of the Customs Act, 1962 hence I find that the seized goods are liable for confiscation under section 111(h) of the Customs Act, 1962. As regard to argument put forth by the party that otherwise duty could have been demanded in the notice itself, I find that no goods can be cleared without filing bills of entry and without payment of duty of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... K. Shah, Director of M/s. Bedi Shipping Ltd. under section 112(b)(ii) of the Customs Act, 1962. The dues adjudged should be paid forthwith." 8. The Appellate Authority confirmed the order of the Adjudicating Authority, however, on somewhat different grounds. He was of the opinion that pursuant to order passed by the Commissioner (Customs), Mumbai confiscating the barges and offering redemption fine, the assessee had not produced any proof that he had in fact redeemed the barges. He noticed that the appeal against such order was filed, but observed that in such appeal only pre-deposit of penalty was waived and in any case appeal was still pending. He was therefore, of the opinion that the goods continue to have the status of imported goods and further unless the barges are redeemed by paying fine and duty, it remains property of the Government of India. On such grounds, he dismissed the appeals of the assessee. 9. Against such orders of the Revenue Authorities, assessee carried the matter in further appeal before the Tribunal. The Tribunal dismissed the appeal observing that the barges are availing benefit of Notification No. 21/2002 and therefore, if any scrap is generated durin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts on record, we find that one of the barges purchased by the appellant did run into some legal complications since it was found that the original owner importer had not completed the necessary formalities. For such purpose, the assessee had to face proceedings initiated by the Commissioner of Customs, Mumbai. He ordered confiscation of barges, but offered fine in lieu of such confiscation. Against such order, appeal of the assessee is pending before the Mumbai High Court. Outcome of such litigation before the Bombay High Court would decide whether order of confiscation was valid or not, whether the assessee has to pay fine to avoid such confiscation and such related questions. However, such pending litigation need not cast any shadow on the present appeal since the questions involved are vastly different. We are informed that such legal complications arose only in one out of four barges owned by the appellant. We have therefore, proceeded on the basis that such barges were imported barges and at the time of import were exempt from payment of customs duty under exemption Notification No. 21/2002 under serial no. 352 till the same were imported for breaking. 13. In that view of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
