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2015 (10) TMI 207 - CESTAT AHMEDABAD

2015 (10) TMI 207 - CESTAT AHMEDABAD - 2015 (329) E.L.T. 588 (Tri. - Ahmd.) - Mis-declaration of good – Demand of Duty & Imposition of Penalty – Appellant had not declared certain goods in cargo declaration because of which said undeclared goods were confiscated and demand of duty alongwith interest and penalty was imposed – Held that:- appellant purchased vessel for ship breaking purpose vide Memorandum of Agreement on “As is Where is” basis – On perusal of said agreement, it was clearly eviden .....

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re kept in vessel from other source and that appellant had paid any amount for seized goods – Demand of duty on these seized items separately can not be sustained which was already included in MOA price as per agreement on lumsum basis – Thus, there was no mis-declaration on part of appellant – Therefore impugned order can not be sustained – Decided in favour of Appellant. - Appeal No. : C/207,223/2007 - ORDER No. A/10319-10320/2015 - Dated:- 13-4-2015 - Mr. P.K. Das and Mr. H.K. Thakur, JJ. For .....

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. Shreeji Shipping Agency filed Import General Manifest (IGM) on behalf of the Master of the said vessel and submitted various declarations as envisaged under Section 30 of the Customs Act, 1962 read with Import General Manifest (Vessels) Regulations, 1971. The appellant, as per agreement dated 23.6.2005 filed bill of entry SBY/48/2005-2006 dated 23.6.2005, which is provisionally assessed to duty of ₹ 7,40,00,574/-, deposited by the appellant on 15.07.2005. On 23.7.2005 and 25.7.2005 durin .....

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has been alleged that the seized goods were not declared in the Cargo declaration in the said IGM. Further, these goods were also not included in the Bill of Entry and these are rendered liable to confiscation under Section 111(iii) (f) and 111(l) of the said Act. By the impugned order, the Commissioner of Customs confiscated the seized goods, which have already been provisionally released and are not available for confiscation, imposed redemption fine of ₹ 20,000/- and ₹ 1,00,000/- .....

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of the Appellant Company, amongst others. 3. Learned Advocate on behalf of the appellants submits that they have purchased vessel RITA for breaking purpose as per agreement dated 23.6.2005. He drew the attention of the Bench to the relevant portion of the agreement. It is revealed from the agreement that the terms and conditions of purchase are As is Where is basis. All stores and equipments lying in the vessel are included in the value. The value of ship spares and Chimney/funnel are already i .....

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at the appellant had not declared the ship spares and spare Chimney in their Bill of Entry, which were recovered during rummage. He drew the attention of the Bench to the relevant portion of the adjudication order to substantiate that the seized spare chimney and ship spares were used in the oil field, whereas the said vessel was a passenger vessel. So, these items are not form part and parcel of the vessel and the adjudicating authority rightly assessed the value of these items and demanded dut .....

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RMANENT BALLAST BUILT IN 1960 U.K., AT LUMSUM USD 7,406,000.00 (UNITED STATES DOLLAR S SEVEN MILLION FOUR HUNDRED SIX THOUSAND ONLY) HEREINAFTER CALLE DTHE PURCHASE PRICE, DELIVERY UNDER TWO C.I.F. SOSIYA/ ALANG. 02. THE TOTAL PURCHASE PRICE OF THE VESSEL, BE LUMSUM USD 7,406,000.00 (UNITED STATES DOLLAR S SEVEN MILLION FOUR HUNDRED SIX THOUSAND ONLY) SHALL BE PAYABE BY MENAS OF A 100% CONFIRMED IRREVOCABLE LETTER OF CREDIT NEGOTIABLE AT 270 DAYS FOR USD 7,406,000.00 (UNITED STATES DOLLAR S SEVE .....

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D UPON. THE LETTER OF CREDIT IS NEGOTIABLE IMMEDIATELY AFTER VESSEL HAS BEEN PHYSICALLY DELIVERED TO THE BUYERS OR THEIR AUTHORISED REPRESENTATIVE BUT NOT LATER THAN 3 (THREE) WORKING DAYS OF SELLERS TENDERING THE NOTICE OF READINESS AND SUBJECT TO THE STIPULATION OF THE LETTER OF CREDIT AND SUBMISSION OF THE DOCUMENTS DETAILED IN CLAUSE 3 HEREINABOVE. 03. (i) to (iii). (iv) COPY OF THE TELEX/ FAX FROM THE SELLERS VIA THEIR AGENTS IMCORPORATING INSTRUCTIONS TO THE MASTER OF THE VESSEL TO PHYSICA .....

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ULY, 2005 AT SELLER S OPTION, BUT NOT BEFORE 23RD JUNE, 2005 HOWEVER CANCELLING DATE IS AT BUYERS OPTION. THE VESSEL SHALL BE DELIVERED SAFELY AFLOAT, PORTWORTHY, FREE OF ARMS AND AMMUNITION, FREE OF CARGO AND UNDER TOW. 05. .. 06. THE VESSEL WITH EVERYTHING BELONGING TO HER SHALL BE AT SELLERS RISK AND EXPENSES UNTIL SHE IS DELIVERED TO THE BUYERS, BUT SUBJECT TO CONDITIONS OF THE CONTRACT, THE VESSEL WITH EVERYTHING BELONGING TO HER SHALL BE DELIVERED AND TAKEN OVER AS SHE IS AT THE TIME OF D .....

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ABLE SPARES/ EQUIPMENT AND WITH REMOVALS IF ANY. 11. THE PHYSICAL DELIVERY OF THE VESSEL SHOULD BE MADE BY THE SELLERS TO THE BUYERS OR THEIR NOMINATED REPRESENTATIVES FOR DEMOLITION ONLY. 12. to 16. -.. 17. ALL STORES & EQUIPMENTS SUCH AS DECK GENERATORS/ SPARE TAIL SHAFT/ SPARE PROPELLOR/ SPARE BLADES/ ANCHORS & STORES ON BOARD LYING ANYWHERE IN THE VESSEL ARE INCLUDED IN THE MOA PRICE. 6. On perusal of the said agreement, it is clearly evident that the appellant purchased the vessel R .....

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all stores and equipments lying in the vessel are included in the MOA price. In fact, any spares, stores and equipments available in the vessel would be the property of the appellant and no extra consideration would be paid by them. The MOA price is lump-sum amount. There is no dispute that seized goods, mainly spares and spare chimney were lying in the vessel. It is seen from the detention memo dated 05.09.2005 that the vessel arrived at Alang anchorage on 14.7.2005 and was boarded and partly .....

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hority observed that there is difference between the size of dimension and the seized chimney/funnel and the one installed chimney/funnel and that the chimney/ funnel was a pre-fabricated structure of the aluminium. That if it has been fabricated as spare then the size and dimension of it would be the same as installed one. Regarding the 34 boxes of spares, it was clear from the expert opinion that they were used in the oil field, wherein the vessel in question was a passenger vessel and there i .....

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s and the seized goods were lying in the vessel. Clause 17 of the Agreement categorically stated that all stores are equipment lying in the vessel are included in MOA price. So, the contracted MOA price is to be accepted, as the Department has not pressed undervaluation by showing the transaction value not being genuine. There is no material available on record that these items were kept in the vessel from other source. Hence, the findings of the Adjudicating authority has no relevancy. It is al .....

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