TMI Blog2015 (7) TMI 998X X X X Extracts X X X X X X X X Extracts X X X X ..... in question is a supply vessel used for transport of persons and goods, the correct classification would be CSTH 89019000 which covers "Other vessels for transport of the goods and other vessels for transport of both persons and goods." And the goods falling under CTH 8901 are exempted under Not 21/2002 read with Notification No. 20/2006. Revenue has invoked the extended time period to demand duty be alleging that the appellant had mis-declared the capabilities of the vessel before the proper officer who did the first check examination. It is also alleged that the proper officer was clearly misguided by the Certificate of Registry. This allegation has no basis whatsoever. We have seen the examination report of the DC customs. It indicates inspection and examination of the vessel with respect to the Certificate of Indian registry. It also indicates that the vessel has a winch with steel wire, bollards at the sides. The Custom officers were free to examine the vessel with respect to any documents for the purpose of determination of classification. - There is no misdeclaration whatsoever. Consequently there is no question of confiscation and option to redeem on payment of redempti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4,87,250. After issue of show cause notice the case was adjudicated by the Commissioner resulting in the impugned order against which the appellant are in appeal before us. 3. Heard both sides and considered the submissions. 4. The contention of the Ld counsel is that the customs heading 8901 covers cruise ships, excursion boats and similar vessels principally designed for the transport of persons and goods whereas Customs heading 8904 covers tugs and pusher craft. The vessel in question is not designed as a tug but as a vessel for supply of goods as well as for carrying passengers. It has been certified as a supply vessel by the Kuwaiti Registry as well as by the Registrar of Indian Ships. The Mercantile Marine Department under the Ministry of Shipping, Govt. of India clarified in their letter dt 29.6.12 to the Customs Department (before issue of show cause notice) that There is no restriction for an offshore supply vessel to undertake towing operations if duly certified so by the class........... The vessel is an 'offshore supply vessel' having towing facilities. It was further submitted that as per the Publication titled Rules and Regulations for the Constructio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the Certificate of Kuwaiti Registry dated 2.5.1994 is very old. Many years have passed since then. The movement of the vessel and its status till the time it was registered under the Indian Merchant Shipping Act in 2008 is not known. Therefore the Certificate of Kuwaiti registry cannot be relied upon. He drew attention to a letter issued by the Indian Register of Shipping addressed to M/s Arcadia Shipping Ltd which gives approval of the towing plan for the vessel in question. The subject of this letter is Approval of towing plan for vessel Bhagirath by tug Offshore Hunter' . This letter approves the towing plan of the vessel Bhagirath from Mumbai to Mumbai High and back. According to ld AR this is sufficient evidence that the vessel in question is a tug. He showed other towing plans for other vessels. In all of them the vessel 'Offshore Hunter' is referred to as a tug. Even the Port Trust record which is maintained by the Port trust authorities for vessels which are towed to the high seas and back, referred to the vessel 'offshore hunter' as a tow. 5.1 The Ld AR stated that the vessel in question is described as offshore tug/supply ship in the website EQ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion' under M.S. Act, is the authorized professional agency to carry out survey of constructional part and they have categorised the vessel. The vessel is an 'Offshore Supply Vessel having towing facilities . Much as we appreciate the efforts of Ld AR in showing us various documents to prove that the vessel is a tug, we find it difficult to ignore the clarification given by the Ministry of Shipping. 6.3 The documents referred to by the ld AR are, firstly, towing plan which are plans prepared by the Indian Register of Shipping approving the movement of the vessels along coastal areas. It is true that the towing plans describe the vessel as a tug. But as we have noted above, the Registrar of Indian ships has himself issued the 'Certificate of Indian Registry' which describes the vessel as an offshore supply vessel. Therefore, just because the towing plans describe the vessel as a tug, it does not have to be classified as a tug. To our mind, the reasonable explanation for describing the vessel as a tug in the towing plan is that the vessel was being used for towage operations even though it is a supply vessel. But that by itself does not necessarily lead to the cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evenue cannot be preferred over the certificate given by the Registrar of Indian Ships. In any case it describes the vessel as tug/supply ship and not as tug alone. Moreover a disclaimer is claimed by the web-site regarding the information given by it. 6.6 We may point out that the statements of the Directors have been misinterpreted by the Department. The answers to some of the questions put to Mr Noshir Mehta, one of the Directors, are given below Ans--- Offshore Hunter has been performing offshore services as a supply boat and other offshore duties/services within the safe working capability of the vessel. Ans--- offshore duties are any duties that the chartered may assign to the vessel to carry out subject to the same being with the safe working capability of the vessel, such as, boat landing, patrolling, supply runs, towing, transportation of men and material, cargo carriage, surveying activities et cetera. Ans--- Once we we give the vessel on time charter, the vessel would undertake any jobs that the character wants within the vessel's safe working capability including towing activity if required. The statement of the other Director Mr. Pervez Mehta also on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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