TaxTMI 
TaxTMI 
2006 (8) TMI 179
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....contractors carried on offshore operations with their oilrigs as per the directions and instructions of ONGC. Between 1970 and 1987, ONGC carried on operations from its facilities at 12, Victoria Docks, Mumbai. The customs department permitted the clearance of goods to and from 12, Victoria Docks and the oil rigs, without compliance of any customs formalities and without the payment of duty of customs, i.e., goods were permitted to be transferred to the rigs from 12, Victoria Docks and were permitted to be removed from the rigs to the shore, without payment of customs duty. 3.In the year 1987, ONGC shifted its offshore operations from 12, Victoria Docks to Nhava Base. This was done because the facilities at 12, Victoria Docks were not sufficient to meet the increased offshore operations being carried on by the ONGC. Operations at Nhava Base are large scale operations and are carried on from five berths. Large warehousing and other facilities are also available at Nhava Base. 4.Appellants entered into separate contracts with appellants between 27-5-1987 to 30-6-1987. The appellants were engaged in exploration and exploitation of offshore oil, gas and other related services as cont....
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....back to the rigs for use. Around July 1988 ONGC decided to shift its operations to Nhava, some distance away from Bombay Port. The procedure that was being followed at Nhava base is elaborated in the show cause notice. Essentially it is this. The contractor's, i.e., the operators of the oil rigs applied to the Chief Engineer of ONGC for permission to transport goods from the base to the rigs or to the base from the rigs. After obtaining his permission transport of the goods took place. The transport took place by the supply vessels. The ONGC issued gate passes on application by the contractor for movement of the goods from the base to the rigs after their receipt in the base. These gate passes indicated the name of the contractor, description of the material and name of the rig. They also signed by the personnel of the Central Industrial Security Force at the gate as also by the contractor's representative." 7.Customs Department issued show cause notices dated 22-4-1994, 12-5-1994 and 12-5-1994 to the appellants wherein it was contended that there were unauthorized loading, unloading, storage or removal of imported, indigenous items and scrap from the Nhava Base. There....
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.... notice dated 12-5-1994; and levied a demand of duty of Rs. 5,06,12,412/- and a penalty amount of Rs. 25,00,000/- upon Aban Loyd Chiles Offshore Limited in respect of show cause notice dated 22-4-1994 and levied a demand of duty of Rs. 68,66,092/- and a penalty amount of Rs. 4,00,000/- upon Amarship Management Limited in respect of show cause notice dated 12-5-1994. 12.Commissioner of Customs of his Orders dated 28-11-1997 and 27-1-1998 ordered confiscation of the goods and levied duty of Rs. 4,95,406/- and penalty of Rs. 25,000/- upon Essar Oil Limited and duty of Rs. 4,69,104/- and penalty of Rs. 25,000/-upon Aban Loyd Chiles Offshore Limited. 13.Being aggrieved by the aforesaid orders the appellants filed five appeals before the Tribunal. The Tribunal by the impugned order disposed of all the aforesaid five appeals by the common order. 14.Tribunal accepted the two appeals filed by the Essar Oil Limited and Aban Loyd Chiles Offshore Limited directed against the order dated 29-9-1997 and 28-11-1997 by which the goods of the appellants were ordered to be confiscated and duty and penalty levied, b....
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....ut by the appellants and ONGC at Nhava Base and prior thereto by ONGC at 12 Victoria Docks. That there is no allegation in the show cause notice that the appellants had evaded the payment of duty either in collusion with the officers of the customs Department or were guilty of making willful mis-statement or for willfully suppressed facts. Relying upon the judgment of this Court in Collector of Central Excise v. H.M.M. Limited, 1995 Supp (3) SCC 322, it was contended that the notice must contain an averment pointing out specifically as to which of the various omissions or commissions had been committed by the noticee so as to invoke the extended period of limitation. It was submitted that the show cause notice in the present case did not contain the averment pointing out specifically as to which of the various omissions or commissions had been committed by the appellants so as to invoke the extended period of limitation. It was further contended that the extended period of limitation could not be invoked in the present case as there was nothing more positive than mere inaction or failure on the part of the appellants. There was no conscious or deliberate withholding of information ....
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.... effect as if for the words "one year" and "six months", the words "five years" were substituted. Explanation. - Where the service of the notice is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of one year or six months or five years, as the case may be." 20.The proviso to Section 28 can be invoked where the payment of duty has escaped by reason of collusion or any willful mis-statement or suppression of facts. So far as 'mis-statement or suppression of facts' are concerned, they are qualified by the word "willful". The word "willful" preceding the words "mis-statement or suppression of facts" clearly spells out that there has to be an intention on the part of the assessee to evade the duty. 21.This Court while interpreting Section 11A of the Customs Act in Collector of Central Excise v. H.M.M. Ltd. (supra) has observed that in order to attract the proviso to Section 11A(1) it must be shown that the excise duty escaped by reason of fraud, collusion or willful mis-statement of suppression of fact with intent to evade the payment of duty. It has been observed : "... Therefore, in order to attract the proviso to Section ....