2024 (2) TMI 1449 - AT - Customs

Tribunal remands case on customs duty for ship dismantling, focusing on overlooked oil in external tanks beyond engine room.

Ashwin Corporation; GGSBY Industries Pvt Ltd Versus C.C., Jamnagar (Prev), Gujarat

The appeal challenged the customs duty demand on oil in tanks of a ship imported for dismantling. The Tribunal determined that the Order in Original only ... Levy of customs duty on the oil contained in the tanks in the ship imported for breaking purposes - HELD THAT:- In the instant case the Order in Original speaks only about the tank contained within the engine room and there is no specific finding about any tank outside the engine room. In this context, the para 5.5 of order of Tribunal in the case of NAVYUG SHIP BREAKING CO., DHAN STEELS PRIVATE LIMITED. AND OTHERS VERSUS C.C., JAMNAGAR (PREV) [2022 (12) TMI 100 - CESTAT AHMEDABAD] becomes relevant, where it was held that 'It can be seen that if the tanks containing Oils are connected with pipeline with the engine or machinery of the vessel, there may be no reason why the same cannot be treated as integral part of the engine or machinery of the vessel. However, since there is no speaking order on that part of issue, we direct the adjudicating authority to pass speaking order in respect of duty pertaining to Oil contained in Bunker Tanks outside the engine room of vessel.' The impugned orders are set aside and matter is remanded to the adjudicating authority to decide in terms of order in the case of Nauyg Ship Breaking Co. - Appeal allowed by way of remand. The appeal was filed against the demand for customs duty on oil in tanks of a ship imported for breaking. The Tribunal found that the Order in Original only addressed tanks within the engine room, not those outside. Citing a previous case, the Tribunal remanded the matter for a decision on the oil in tanks outside the engine room. The impugned orders were set aside.