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TMI Blog2018 (3) TMI 653X X X X Extracts X X X X X X X X Extracts X X X X ..... said vessel submitted the list of 10 Port on call dated 20.06.2008 at arrival of the said vessel at Sikka Port. From the said list it reveals that from Port Qasim to Sikka it was in ballast, without any cargo bound for Sikka. The master of the vessel has also declared the ship stores on her arrival at Sikka Port as on 20.06.2008. The said vessel has also received bonded bunkers from the Mundra Port SEZ supplied by M/s Adani Enterprises Ltd., Ahmedabad against shipping bill No. 181 dated 19.06.2008 of furnace oil weighing 430 MT. As per the Certificate dated 21.06.2008 issued by the master of the vessel only 246.830 MT of furnace oil was received on Board. At the time of commencement of coastal run on 21.06.2008, the master of the vessel further declared the details of bunkers on Board as on 21.06.2008 at 00:48 hours. The Respondent No. 2, M/s Atlantic Shipping Pvt. Ltd. Sikka, filed bill of entry No. F-26 dated 24.06.2008 in respect of bunkers and provisions estimated to be consumed by the vessel during the coastal voyage. Alleging that since the respondent M/s Reliance Industries Ltd. as on the date of receipt of the duty free bunkers i.e. 246.830 MT of furnace oil from M/s Adani ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordingly the vessel was not entitled to obtain duty free bunkers on board on her arrival at Sikka, after completion of necessary investigation, SCN was issued to the Respondent M/s Reliance Industries Ltd. on 18.9.2009 for recovery of customs duty amounting to Rs. 26,28,680/- along with interest and proposal for penalty and confiscation of the goods, also penalty on the second Respondent. 4. Both the notices dated 15.09.2009 and 18.09.2009 issued for recovery of duty of Rs. 14,68,419/- and 26,28,680/-, respectively, were adjudicated by the Joint Commissioner of Customs (Prev.) Jamnagar and the duty was confirmed against M/s Reliance Industries Ltd. with interest and penalty and penalty on the Respondent No. 2 M/s Atlantic Shipping P. Ltd. was also imposed. Aggrieved by the said order, the Respondents filed appeals before the Ld. Commissioner (Appeals), who in turn, allowed their appeals. Hence, the Revenue is in appeal. The Respondents had filed cross objection against the said order of the Ld. Commissioner (Appeals). 5. Ld. AR for the Revenue has submitted that the Ld. Commissioner (Appeals) has set aside the order of the adjudicating authority observing that the adjudicating au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gn voyage and accordingly it was decided that the vessel MT Sinar Agra would proceed on coastal run for Dahej Port. The vessel agent Atlantic Shipping Pvt. Ltd. through their letter dated 20.06.2008, informed the Superintendent of Customs Sikka after receiving the duty free bunkers that the vessel would sail in ballast for Dahej and requested to depute the Preventive Officer on board of the vessel. The Preventive Officer of Customs boarded the vessel on 20.06.2008 and took inventory of the ship stores/ bunkers provisions. On 21.06.2008, the vessel was converted from foreign run vessel to coastal run vessel. The Preventive Officer of customs also signed on 21.06.2008 a Landing Certificate certifying that a quantity of 246.83 MT of bunker (furnace oil) which was cleared from the SEZ unit against shipping bill No. 181 dated 19.06.2008 had been received on board of the vessel. The said vessel after undertaking voyages between Sikka, Dahej, Vijar, Kandla and Sikka subsequently proceeded to Karachi and Port Qasim around 08.08.2008. It is his contention that during such foreign voyage to Karachi and Port Qasim, the duty free bunkers procured on 21.06.2008 from the said SEZ unit were consu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly of duty free bunkers to the vessel MT High Spirit at Sikka Port. The said shipping bills were assessed by the Authorized Officers of SEZ units for clearance of the bunkers to the said vessels without payment of duty. It is his contention that the jurisdiction to question such duty free clearance from the SEZ unit and demand duty vests with the Authorized Officers of the SEZ unit under the Provisions of SEZ Act 2005, and the rules made thereunder and not with the Additional Commissioner Customs (Preventive) Jamnagar, exercising jurisdiction under the Customs Act, 1962, therefore, the demand notice is without jurisdiction. Further, taking recourse to Section 51 and the SEZ Act, 2005 which has an overriding effect against any other law including Customs Act, 1962, he has submitted that the SEZ Act and the Rules constitute a special self contained code which does not include the jurisdiction of Customs officer to demand duty in respect of goods cleared from SEZ, the charge for levy of customs duty on goods cleared from SEZ is not created by Section 12 of the Customs Act,1962, but by the Specific Provision viz. Section 30 of the SEZ Act, 2005. Accordingly, the power to assess and dem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssel received the stores at Sikka Port was though not a foreign going vessel, since it was initially planned that the next voyage of the vessel would be a foreign voyage to EGPC Suez, the vessel was entitled to receive duty free bunkers. The initial plan for foreign voyage is clear from the statement of Mr. Laxmikant Shukla dated 28.08.2008 as the foreign voyage was cancelled due to failure of the cargo pumps. 10. Heard both the sides and perused the records. 11. The facts narrated above in both the appeals are not in dispute. The vessel MT Sinar Agra arrived at Sikka Port on 20.06.2008 and received the duty free bunkers supplied by Adani Enterprises Ltd. SEZ. The said vessel was converted from foreign going vessel to coastal run vessel on 21.06.2008. Similarly, the vessel MT High Spirit arrived at Sikka Port on 08.06.2008. The said vessel also received the duty free bunkers on 08.06.2008; later the said vessel was also converted to coastal run on 09.06.2008. The Ld. Commissioner(Appeals) interpreting the provisions of Section 30 of the SEZ Act, arrived at the conclusion that the charging provision on goods removed from the SEZ to the domestic tariff area is Section 30 of the SEZ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aw. The Revenue s allegation/ attempt to establish that the Respondent was aware of the fact that the vessels would not undertake foreign voyage which though not corroborated by evidence, even otherwise also if accepted, it is immaterial and irrelevant since as on the date of clearance of bunkers from the SEZ as export, the vessels were not converted to coastal run vessels. In the above facts and circumstances, the provisions of SEZ Act, 2005 and the Rules made thereunder is clearly not applicable to assess the duty free bunkers received and later used for costal run. Therefore, I do not have any hesitation to hold that Joint Commissioner has rightly exercised jurisdiction in demanding the customs duty on the duty free bunkers when used in the coastal run. Since, the Ld. Commissioner (Appeals) has not considered other issues raised by the Respondent in their grounds of appeal before him and reiterated in the cross objection before this Tribunal, in my opinion, it is prudent to remand the matter to the Ld. Commissioner (Appeals) to consider all issues raised including merit and limitation and record a finding on the same. In the result, the impugned Order is set aside and the Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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