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2016 (12) TMI 73 - CESTAT MUMBAI

2016 (12) TMI 73 - CESTAT MUMBAI - TMI - Jurisdiction - import of vessel ‘MT Navdhenu Sana’ - smuggled goods - Held that: - We find that in the case of Shipping Corporation of India [2014 (12) TMI 617 - CESTAT MUMBAI] and Samson Maritime Ltd. & anr. v. Commissioner of Customs (Import), Mumbai [2015 (11) TMI 1023 - CESTAT MUMBAI], the issue of duty liability was also considered along with the issue of jurisdiction. So it is here, too, as the appellant has claimed to be a ‘foreign-going vessel’ wh .....

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l attracted. Consequently, the appellant is not liable to any penalty under Section 112(a)/(b) of the Customs Act, 1962 either - appeal allowed - decided in favor of appellant-assessee. - C/85180 & 85181/2013 - A/93174-93175/16/CB - Dated:- 18-10-2016 - Shri M V Ravindran, Member (Judicial) and Shri C J Mathew, Member (Technical) Shri S N Kantawala, Advocate for the appellant Shri K M Mondal, Special Counsel for the respondent ORDER Two appeals arising out of common order-in-original no. 2012/CA .....

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Sana , an anchor handling tug built in China and registered by its owners at Singapore under the name and style of GB Sea Snapper , was bought and taken delivery of in January 2011 by M/s Arcadia Shipping Ltd. As it was now owned by an Indian entity and as required under Merchant Shipping Act, 1958, a provisional registration was accorded. It arrived at Mumbai on 24th February 2011 and was lying at the Great Offshore Docks for repairs after permission for entry was accorded upon filing Import Ge .....

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, 1962. The vessel, valued at ₹ 26,25,21,979 for assessment, was allowed provisional release on 12th December 2011 subject to payment of customs duty of ₹ 3,99,31,876, furnishing of bank guarantee of ₹ 5,25,00,000/- and on execution of bond for assessable value. Reportedly, the vessel sailed out on 10th January 2012 after change in name and registry owing to transfer of vessel to foreign owner on 3rd January 2012. In the meanwhile, permanent registration in the Indian Register .....

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orldwide and coastal trade - was issued on 12th January 2011 which was extended on 14th June 2011 for a further period of six months till 11th January 2012. As early as December 2010, they had also applied for a licence for a period of sixty months. 5. It is the contention of the appellants that the vessel was brought into India to tow a ship imported for breaking and that it was intended for use outside India. We note that the vessel has been subjected to payment of duty and that it was exporte .....

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mbai [2016-TIOL-93-CESTAT-MUM]. That the competent jurisdiction was not Mumbai is clear from the impugned order itself admitting that the vessel had, indeed, called at Bhavnagar and had sailed out for Fujairah from there on a foreign run is the concomitant contention on behalf of the appellant. 7. Learned Special Counsel, Mr Mondal, appearing for respondent-Commissioner fervently opposed this line of argument and contended that the decisions relied upon are not applicable to the facts in dispute .....

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We have, once again, at the behest of Mr Mondal perused the show cause notice and impugned order but find ourselves unable to appreciate the latter contention of his. An Import General Manifest for the vessel as conveyance had been filed upon arrival at Mumbai on 24th February 2011. The logic of his inference that the master of the vessel was also mandated to include the vessel as goods would empower every Commissioner at every port of call to invoke jurisdiction at any time during the sailing .....

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. There is, therefore, no logic for insisting that all cargo on board have to be declared or any legal requirement to do so. Even if the prescribed form requires declaration of transhipment and same bottom cargo, it would appear that a floating conveyance can hardly be called same bottom or transhipment cargo. It is patent that ships , literally and figuratively, are not of the same standing as other cargo for the expression vessels finds inclusion within the definition of goods and conveyances .....

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ntention of the allegation that the vessel, as goods , had not discharged its liability was goods and was liable to be subject to recovery action the issue of jurisdiction to invoke section 28 of Customs Act, 1962 cannot be avoided. Even though the impugned order has invoked section 125 of Customs Act, 1962 which normally is invoked at place of seizure to demand the duty, we find that this action is questionable given that it does not find mention in the show cause notice. This aspect requires s .....

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ment of determination of duty not-paid or short-paid devolving on the proper officer. Section 125 itself does not mandate determination by the proper officer but requires compliance with liability to discharge duty; consequently, consequently in the absence of assessment at the time of import the adjudicating authority is required to follow the procedure for assessment because duty liability cannot be fastened de hors section 12 of Customs Act, 1962 and section 17 of Customs Act, 1962. In the in .....

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at Mumbai and, admittedly, it failed to declare that the vessel, itself, was goods. This was rectified by filing of another Import General Manifest no 2013841 dated 13th June 2011 incorporating the vessel' as goods. We find in section 30 (3) of Customs Act, 1962 that (3) If the proper officer is satisfied that the import manifest or import report is in any way incorrect or incomplete, and that there was no fraudulent intention, he may permit it to amended or supplemented. which would render .....

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e bill of entry no. 4846251 dated 5th October 2011 was pending for assessment at the time of sailing of the vessel and issue of port clearance. From a plain reading of section 125, the legislative intent is clear in that the offending goods are liable to be held back till duty is paid with duty liability being assessed in the manner prescribed in law. Consequently, for invoking the duty payment clause of section 125, the jurisdiction to determine duty liability is sine qua non; else section 125( .....

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ns compliance with the procedure prescribed for assessment. And that, verily, is inextricably linked with jurisdiction of Bhavnagar to assess duty. The contention of Learned Special Counsel that the jurisdiction question that arose in re Shipping Corporation of India and re Samson Maritime Ltd does not arise here is not acceptable. 11. We find that in re Shipping Corporation of India and re Samson Maritime Ltd, the issue of duty liability was also considered along with the issue of jurisdiction. .....

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