TaxTMI 
TaxTMI 
2012 (8) TMI 55
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..... The vessel returned on or about 1 December 2011. The vessel was seized on 1 December 2011. On 14 December 2011, the Petitioners were informed that the investigation has been taken over by the Directorate of Revenue Intelligence and it was that authority which could be approached for conditional release of the vessel. On 16 December 2011, the Deputy Director in the DRI informed the Petitioners that duty liability has been provisionally quantified on the non-declared value of repairs and machinery/equipment installed on three vessels Seamec-I, II and III. The Petitioners were directed to deposit an amount of Rs.6.72 crores towards Seamec II and Rs.4.14 crores towards Seamec-III. There is no dispute about the fact that the aforesaid amounts ....
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....eedings or any other proceedings that may be initiated by the department." As regards Seamec-III, the Petitioners have been informed that no action in relation to the vessel is pending at the level of the Commissionerate and the Petitioners have been directed to approach the DRI. At the hearing of these proceedings, Counsel appearing on behalf of the Respondents, including the Commissioner of Customs (Import) and the Directorate of Revenue Intelligence states that Seamec-III is not under seizure and no action is pending at the behest of the Revenue. The dispute, therefore, survives in relation to the seizure of Seamec-II and the order for the release provisionally of the vessel under Section 110A of the Customs Act, 1962. 3. Counsel appe....
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....ormed the Petitioners by its letter dated 16 December 2011 that the Commissioner of Customs (Import) was being requested separately to permit the utilization of the Served from India Scheme Certificate towards the duty liability of Seamec-II. 4. In the affidavit in reply that has been filed by the Assistant Commissioner of Customs, it has been submitted that the Served from India Scheme was introduced as a promotion scheme for export and that consequently the Petitioners should not be permitted to utilize the credit available under the Scheme, particularly since there is an allegation of a contravention of the provisions of the Customs Act, 1962. Counsel appearing on behalf of the Revenue submitted that the Petitioners have been justifiabl....
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....adation carried out after 6 July 2011 which has been computed at Rs.82.09 crores. The Petitioners are undoubtedly liable to pay duty in respect of the modification/upgradation that has taken place which amount is computed on a provisional basis at Rs.82.09 crores.. On this amount, the duty liability assessed provisionally works out to Rs.12.77 crores. As regards the value of the vessel of Rs.53.55 crores, prima facie, at this stage, Counsel appearing on behalf of the Revenue does not dispute the position that the vessel, when it was imported in 1988 was not subject to the levy of customs duty. In this regard, reliance has been placed on behalf of the Petitioners on Notification No.262Cus., dated 11 October 1958 under which ocean going vesse....
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....f SeamecII. The Served from India Scheme, a copy of which is annexed at Exhibit 4 to the Rejoinder provides that all service providers of services listed in Appendix 10 of Handbook of Procedures, who have a total foreign exchange earning or earning in Indian Rupees which are otherwise considered as having been paid for in free foreign exchange by RBI of at least 10 lakhs in the preceding or current financial year shall be eligible to qualify for a duty credit scrip. Under Clause 3.6.4.5, the duty credit scrip may be used for import of any capital goods which are otherwise freely importable under the ITC (HS) Classification of Export and Import items. In our view, since the DRI has indicated that it has no objection to the availment of the c....