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Lucky Steel Industries, YS Investments, Rushi Industries Ltd, Dynamic Ship Recyclers Pvt Ltd, Anand Exports, Shital Ispat Pvt Ltd, Shanti Ship Breakers Pvt Ltd, Shirdi Steel Traders, Honey Ship Breaking Pvt Ltd, Dhan Steel Pvt Ltd Versus C.C. -Jamnagar (prev)

2015 (11) TMI 1398 - CESTAT AHMEDABAD

Classification of the ships/vessel, brought in for breaking up along with surplus fuel - Confiscation of goods - Imposition of redemption fine and penalty - Held that:- An opinion/clarification issued by Joint DGFT has to be considered as a clarification issued by DGFT & will be binding on the customs so far as ITC restrictions are concerned under Foreign Trade Policy. However, the same clarification issued by DGFT may not be binding on the Customs for the classification of the same goods under .....

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he vessels brought in for breaking up, cannot be held as liable for confiscation under Section 111(d) of the Customs Act, 1962 and no penalties upon the appellants are imposable in the present appeals under Section 112(a) of the Customs Act, 1962. It is also relevant to mention that no ITC action is taken by the Revenue when an ocean-going vessel is converted into coastal-run vessel and only duties are paid on the fuel used during the coastal run. - Decided in favour of assessee. - Appeal No. C/ .....

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ER Per Mr. P. K. Das Common issue is involved in these appeals and therefore, all are taken up together for disposal. 2. The appellants filed these applications for Early Hearing of the appeals. After hearing both the sides, we find that the issues involved in these appeals appear to be covered by the decision of the Tribunal, in the case of AG Enterprises Vs. Commissioners of Customs, Jamnagar 2014 (308) ELT 18 (Tri.Ahmd). So, upon consent of both the parties, we take up the hearing of the appe .....

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ted vessels for breaking purposes. It was noticed that MGO was lying in the tank of the ship engine. According to the Revenue, the said MGO (HSD) would be classified under chapter 27 of the Customs Tariff and is a restricted item. The appellant contended that it would be considered as part of the vessels and classified under chapter 89.08 of the import policy. It is further contended that there is no violation of the policy, as per clarification of the DGFT. 4. We find that issue is no more res- .....

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, the goods were released on provisional assessment. 5. We find that the issue is covered by the decision of the Tribunal in the case of AG Enterprises(Supra) in favour of the importer, and therefore there is no need to discuss the submission of the learned counsel on other issues. For the purpose of proper appreciation of the case, we reproduce below the relevant portion in the case of AG Enterprises (Supra). 4.Heard both sides and perused the case records. The? issue involved in all these appe .....

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in the vessel as fuel/ship stores at the time of purchase and no extra price is paid for such fuel. It is observed that DGFT under F. No. IPC/4/5(684)/97/82/PC-2(A), dated 26-6-2013 has opined that surplus fuel stored in the fuel tanks (whether inside or outside engine room) forms a part of the ship/vessels imported for breaking up and should be considered as integrated part of the vessel s machinery and is classifiable under 89.08. 4.1 It is further observed that Para 2.3 of Chapter 2? of the F .....

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As per the above provisions of Foreign Trade Policy? any doubt regarding classification of any item in ITC (HS) or HBPv1 or HBPv2 or schedule of DEPB Rates should be referred to DGFT whose decision shall be final and binding. As per the clarification/opinion of Joint Director General of Foreign Trade, New Delhi, surplus fuel stored in fuel tanks of vessels/ship brought for breaking up is classifiable under 89.08 along with the main vessel. In this regard, Paras 18 & 19 of case law Cine Land .....

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rs and exporters who apply for such clarifications to the DGFT. It sounds to reason that it would be physically impossible for one DGFT to personally sign replies to these apart from his numerous other responsibilities. Secondly, here there is no certification required of a named authority in the body of a fiscal notification concerning exemption from Customs duty. Such a clarification required from only a named authority is a different requirement than the issue of a clarification on import pol .....

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