TaxTMI 
TaxTMI 
2005 (1) TMI 571
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....d from 27-4-1999 to 30-11-1999. The Respondent is the agent of the vessel during the relevant period. They imported certain ship stores through Air Customs, Chennai and Mumbai. On an application from the Respondent, Chennai Customs allowed transhipment of the ship stores without payment of duty for placing on board the vessel at Kakinada. The transhipments was done under Chapter (VIII) of the Customs Act 1962. 2.The Commissioner of Central Excise Visakhapatnam proceeded against the Respondent demanding duty of Rs. 33,42,556/- on the following grounds : (1) Ship stores when imported into the country should pay duty. (2) Transhipments under Section 52 Chapter (VIII) is not applicable to....
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....s not legal and proper. Had the appropriate provisions been applied at the port of importation, the duty would have been paid and the goods would have been cleared. In that case, jurisdiction to demand duty is with the port of importation. 2. When a notice in terms of Section 28(1) of the Customs Act, 1962 was already issued vide F. No. S. Misc. 515/2000-ACC, dated 19-8-2000 by the Deputy Commissioner (Transhipment) Chennai to M/s. Chandra Maritime (P) Ltd., the Commissioner should not have adjudicated the case for want of jurisdiction. Therefore the Commissioner had no jurisdiction to drop the proceedings". 4.Shri R.V.Ramakrishnappa, learned....
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....evenue is that Section 52 is not applicable to the stores is correct. Chapter (VIII) of the Customs Act deals with goods in transit. Section 54 specifically deals with transhipment of goods without payment of duty. Section 52 of the Act clearly says that Chapter (VIII) provisions do not apply to baggage, goods imported by post and stores. Hence the Chennai Customs have not followed the correct procedure in allowing transhipment of stores under Section 54. In the transhipment application, the respondents have indicated that the goods are spare parts for ships. It is also mentioned that these goods are to be placed on board the vessel 'Algosaibi'. Under these circumstances it is not correct to hold that the respondents have suppressed the fac....
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....e above facts, no purpose would be served by demanding duty on the ship stores. The Adjudicating authority has observed that mere transhipment of ship stores to a foreign going vessel converted into coastal run does not automatically mean that the transhipped ship stores, are liable to imposition of import duties. The above observation of the Adjudicating Authority is not in consonance with Customs Act. First of all, transhipment provisions under Chapter (VIII) are not applicable to ship stores. Secondly, as per Section 87, imported stores may be consumed without payment of duty, only on board a foreign going vessel repeat foreign going vessel. In the case at instance, the Customs authorities knowingly or unknowingly have permitted imported....