Supreme Court: No Duty Drawback for Cargo Sunk in Indian Waters

The Supreme Court ruled that cargo sinking within Indian territorial waters did not qualify for duty drawback under the Customs and Central Excise Duties Drawback Rules, 1971. The Court emphasized that goods must be taken outside India, beyond territorial waters, for an export to occur. Citing a prior judgment, the Court clarified that high seas beyond territorial waters also constitute a place outside India. As the cargo was destroyed within Indian waters, no duty drawback was granted. The civil appeal was allowed, with no costs awarded.

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Issues: Duty drawback eligibility for destroyed cargo loaded for export.

The Supreme Court held that the cargo loaded by the respondents, which sank within the territorial waters of India, did not qualify as an export under the Customs and Central Excise Duties Drawback Rules, 1971. The Court emphasized that for an export to occur, the goods must be taken out of India to a place outside India, beyond the territorial waters. Referring to a previous judgment, the Court clarified that high seas outside territorial waters would also qualify as a place outside India. Since the cargo was destroyed within Indian waters, no duty drawback was available. The civil appeal was allowed, and no costs were awarded.

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