TaxTMI 
TaxTMI 
2024 (2) TMI 319
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.... authority was of the view that the said containers are liable for confiscation for violation of the condition laid down in the Notification No. 104/94-Cus, dtd. 16.03.1994, the said 39 containers lying at M/s. Gujarat Pipavav Port Ltd (11 containers) and M/s Contras Logistics Pvt. Ltd. (28 containers) were placed under seizure on 05.11.2015 and handed over to the respective CFS for safe custody under Supratnama dated 05.11.2015. 2. After completion of investigation a Show Cause Notice, dated 27.04.2016 was issued to appellant. After due process of law the adjudicating authority passed the impugned order, wherein he confirmed duty amounting to Rs. 9,48,095/- along with interest. Ordered for confiscation of 39 empty containers valued at Rs.32,20,324/- under Section 111(o) of the Customs Act, 1962 and allowed to redeem the same on payment of redemption fine of Rs.3,22,000/-. It also imposed a penalty of Rs. 9,48,095/- under Section 112(a) as well as Section 114A of Customs Act, 1962. 3. Being aggrieved with the adjudication order the appellant filed appeal on various grounds before Commissioner (Appeals), who after following process of hearing endorsed in toto the order of lowe....
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....s prescribed in the said notification and did not seek any extension of time limit for re-export from the proper officer, which is the prime condition of exemption Notification No. 104/1994 as amended. 4.2 Appellant further submits that the duty of customs is leviable under Section 12 of the Customs Act, 1962 on importation of goods into India. Import commences when goods enter into Indian Territorial waters and is completed only when it crosses the customs barrier and mixed with the land mass of India. However, in the instant case, import procedure of disputed containers was never completed as the same had never crossed the customs barriers. 4.3 It is also a fact on record that 11 containers lying at Gujarat Pipavav Port Ltd., APM Terminal (i.e. GPPL) and 28 containers lying at Contras Logistics-CFS were found heavily damaged. From the date 'Gate In' shown in Annexures to seizure memos it is evident that the said containers were lying there before the fire accident took place on 07.11.2010. Thus, containers were lying in the Customs area. Therefore these containers cannot be considered as imported into India and therefore, no duty of customs is payable on the same. A....
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....8 of the Customs Act, 1962 in the said case by the customs. In other words, the case of the shipping agency was almost akin to the impugned case of appellant. Hon'ble Tribunal in that case had ruled in favour of appellant shipping agency briefly on the ground that since the containers were not in possession of the shipping agency, duty cannot be demanded from them; that duty in such case cannot be demanded under provisions of section 28 of the Customs Act, 1962. 4.7 It was observed by Hon'ble Tribunal that the original authority has erroneously placed reliance on section 28 of the Customs Act 1962 to recover duty without adducing any evidence to conclude that the ingredients for invoking the extended period are present while, at the same time, acknowledging the existence of a bond furnished in accordance with the conditions prescribed in notification no. 104/94 dated 16th March 1994 as the genesis of the proceedings. One of the other reasons to set aside the order was that the containers remained with the custodian appointed under Customs Act, 1962; that in the circumstances of the containers being in the custody of an entity other than the appellant, an agent of the shi....
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....ed by department, the same cannot fetch more than scrap value. Appellant therefore, submits that when the assessable value itself is highly inflated and erroneous, customs duty worked out on the basis of the same cannot be sustained. 4.10 In backdrop of the above appellant respectfully further submits that duty of Rs. 9,48,095/- has been demanded on the value of Rs. 32,20,324/- in the impugned case. As per seizure memo value of the 39 damaged containers is Rs. 16,00,000/- only. 5. In view of the above, appellant submits that computation of customs duty of Rs.9,48,095/- on so called realizable value of Rs.32,20,324/- is totally erroneous and, therefore, order is liable to be set aside on this ground too. 6. Appellant in view of the above especially decision of Hon'ble Tribunal in the case of KUTCH SHIPPING AGENCY PVT LTD. Vs COMMISSIONER OF CUSTOMS (GENERAL) MUMBAI as reported at 2017-TIOL-1415-CESTATMUM order confirming demand with interest and penalty as well as redemption fine in lieu of confiscation is liable to be set aside. Therefore, it is prayed that appellant's appeal may be allowed by setting aside the impugned Order-in- Appeal of the Commissioner (Appeals....