TaxTMI 
TaxTMI 
2015 (2) TMI 645
X X X X Extracts X X X X
X X X X Extracts X X X X
.... duty demand of Rs. 24,36,36,471/- along with interest thereon and also imposing an equivalent amount of penalty on the appellant M/s Creative Gaming Solutions Pvt. Ltd., Mumbai. Aggrieved of the same the appellant is before us. 2. The facts relevant to the case are briefly as follows. The appellant, M/s Creative Gaming Solutions Pvt. Ltd., imported a second hand passenger ship "M.V. San Antonio" vide B/E No. 243 dated 27/12/2010 and cleared the same without payment of duty by classifying the vessel under CTH 89011010 as a passenger ship and claiming the benefit of notification No. 21/2002-Cus dated 1-3-2002. Subsequent to the clearance of the vessel the department made enquiries and gathered information and it was found that the vessel ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ce the appeal. 3. The ld. Counsel for the appellant made the following submissions which are summarised below:- (1) The vessel was designed and commissioned as a passenger ship in 1989 and had been used as a passenger ship for 18 years before being bought by the appellant. The memorandum of agreement, bill of sale and the purchase order clearly indicate that the appellant intended to purchase a passenger ship. Thus the vessel was designed to be a passenger ship and hence is classifiable under CTH 8901 as a ship principally designed for the transport of persons. (2) In a recent decision in the case of Ashok Khetrapal vs. CC, Jamnagar [2014 (304) ELT 408], in a similar factual scenario, the co-ordinate bench of this Tribunal at Ahmed....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 1965 and Certificate of Class issued under RINA rules. (5) Classification under CTH 8903 as 'other vessels for pleasure or sports' adopted by the Revenue is incorrect as vessels designed or used for pleasure are generally smaller than ships and do not carry cargo or passengers for commercial purposes. Section 310 of the Merchant Shipping Certificate grants exemption to any pleasure vessel from obtaining a load line certificate which is a mandatory requirement for all other vessels. The vessel imported by the appellant had earlier been issued an international load line certificate which shows that it is not a pleasure vessel. (6) The reliance placed by the Revenue on the decision of this Tribunal in the case of Commissioner vs....
X X X X Extracts X X X X
X X X X Extracts X X X X
....gned order. 4. The ld. Special Consultant appearing for the Revenue made the following submissions. (a) CTH 8901 covers "Cruise ships, excursion boats, ferry boats, cargo ships, barges and similar vessels for the transport of persons or goods" while CTH 8903 covers "yachts and other vessels for pleasure or sports; rowing boats and canoes". As per HSN explanatory notes, heading 8901 covers all vessels for transport of persons or goods, other than vessels of heading 8903. Heading 8903 covers all vessels for pleasure or sports. (b) The issue of classification in this case is covered by the decision of this Tribunal in the case of Waterways Shipyard Pvt. Ltd. (supra) where in respect of a passenger vessel used as casino, it was held th....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... it is prayed that the appellant should be put to terms. 5. We have carefully considered the rival submissions. 5.1 There are two issues involved in the present appeal - one relates to classification and other relates to valuation, of the imported vessel. If the classification of the vessel as claimed by the appellant under CTH 8901 is upheld, the valuation issue will not be relevant as goods falling under CTH 8901 were exempt from duty at the relevant time. On the other hand if classification under CTH 8903 as claimed by the Revenue is upheld, the valuation issue will assume significance. 5.2 In the Provisional Class Notation Certificate issued for the vessel San Domino by the Indian Register of Shipping vide certificate dated 26-....