Conditional exemption for ship-breaking goods fails where prescribed customs duty rate was not paid on the vessel

Exemption under Notification No. 103/87-C.E. was conditional on the ship having borne customs duty at the prescribed rate of Rs. 1400 per LDT. Because the ship had been imported earlier when a lower rate applied, and the required duty at the stipulated rate was not paid, the condition for exemption was not met. The notification could not be ended beyond its express terms to cover ships imported before that rate came into force, so the exemption claim failed.

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Issues: Whether the benefit of exemption Notification No. 103/87-C.E. was available to goods obtained from breaking up of a ship on which customs duty had not been paid at the prescribed rate of Rs. 1400 per LDT.

Analysis: The notification made the exemption conditional upon the ship having borne customs duty at the specified rate of Rs. 1400 per LDT. The ship in question had been imported earlier, when the applicable rate was lower, and the required duty at the prescribed rate had not been paid. The condition attached to the exemption was therefore not satisfied, and the scope of the notification could not be enlarged to cover ships imported before the prescribed rate came into force.

Conclusion: The exemption was not available to the appellant, and the claim under the notification failed.

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