TaxTMI 
TaxTMI 
2014 (12) TMI 772
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....impugned order, the learned adjudicating authority has classified the vessel, M.V. Viva, imported by the appellant M/s. Prince Marine Transport Services Pvt. Ltd., Mumbai under CTH 8904 as 'Anchor-Handling Tug/Supply Vessel' (AHTS), liable to customs duty at an effective rate of 9.356%. He has also determined the value of the goods at Rs. 10,29,81,975/- by holding that the cost of the vessel at Rs. 8,41,79,443/- and has added freight @20% of the cost and insurance @1.125% of the cost. Accordingly, he has determined the duty payable on the said goods at Rs. 96,34,994/-. He has also confiscated the vessel under Section 111(m) of the Customs Act, 1962 with an option to redeem the same on payment of fine Rs. 1 crore. He has imposed a penalt....
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....chor handling, having an open stern to allow the decking of anchors, and having more power to increase the bollard pull." 3.1 From the certificate issued by Tidewater Statesman Service relating to the characteristics of the vessel, it has been certified that the vessel can carry 29 persons on board and it has a capacity to carry cargo of 609.6 MT on the deck. There are four bulk tanks with a capacity of 169.9 Cu.Ms, fresh water capacity of 804 MTs, potable water capacity of 190 MT, fuel oil capacity of 247 MTs and so on. The vessel has been modified after purchase from the original owner at Dubai. From these documentary evidences available, it is clear that the vessel is a supply vessel meant for carriage of cargo or person and, therefor....
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....ty agreement with M/s. Leighton Contractors (India) Pvt. Ltd. wherein the said vessel would be used as a supply vessel and, therefore, it cannot be considered as a towing vessel. 4. The learned Additional Commissioner (AR) appearing for the Revenue, on the other hand, reiterates the finding of the adjudicating authority. He submits that there was one No. Winch Smatco DBL Drum WF - Model 84 DAW-250 with pulling capacity of 175 Tons to be used for pulling/moving/shifting on board heavy equipments, if any, by loading/unloading transportation of heavy equipments. The vessel was purchased from M/s. Tidewater Offshore, Malaysia, and the vessel was originally registered as 'Anchor Handling Tug/Supply vessel'. Though the vessel was old and u....
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....egards the winch fitted on the vessel it is for pulling/moving/shifting on board heavy equipment and the winch is not meant for any towing purposes at all. However, from the original manufacturer's certificate issued by M/s. Tidewater Statesman Service, the vessel has a capacity to carry 29 persons and capacity to carry cargo as discussed in para 3.1 above. From these evidences available on record, it is seen that the vessel is primarily meant to be used as a supply vessel and not as a tug or a towing vessel. 5.1 According to HSN Explanatory Notes 8901.90 covers vessels for transport of goods and vessels for transport of both persons and goods whereas heading 8904 applies only for vessels which are primarily designed for towing other....
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....or handling feature is only as an additional facility and would not take away the vessel from the scope of a cargo vessel or a vessel which can transport persons. 5.3 As regards the re-determination of value, we find that the Commissioner has adopted a rate of 21.125% of the cost towards freight and insurance. The appellant had given details of the expenditure incurred by them for the transport of the vessel from Dubai to India. In such a situation, the Commissioner could not have added freight and insurance @21.125%. Since the vessel had come on its own motion, only the actual cost of transportation incurred should have been added for determination of assessable value. 5.4 As regards the confiscation and imposition of penalty, we do ....