TaxTMI 
TaxTMI 
2026 (1) TMI 669
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....ersion from foreign to coastal run. 3.The impugned communications refer primarily, to Notification No. 12/2012 where Serial No. 462 stipulates that goods under tariff heading 8901 (foreign going vessels), are exempt from basic customs duty (BCD) and CVD, subject to the condition that appropriate duty is remitted upon conversion to coastal run. 4. 'Jug Rahul' has been imported in 2005. No Bill of Entry has been filed as the law did not mandate the filing of Bill of Entry at that relevant point in time. As far as 'Jug Rishi' is concerned, Bill of Entry has been filed on 28.03.2011. Both imports are prior to date of Notification dated 12/2012. 5. The petitioner relies on a decision of the Orissa High Court in its own case Great Eastern Shipping Company Ltd and Ors v Union of India and Ors [379 ELT 318(Ori) : W.P(C) No. 4 of 2013]. The challenge is identical in that case as well and relates to three other vessels being 'Jug Arnav', 'Jag Ratan' and 'Jag Rani', that had been imported on 30.04.2003, 13.11.2007 and 26.08.2011, respectively. The Court proceeds on the basis that Notification No. 12/2012 would not adversely impact those imports that had taken place prior to date of N....
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.... some due date. The subject matter of the said circular issued by the CBEC "procedure followed for import of Indian vessels and filing of import general manifest, bill of entry regarding". 22. The circular explains in detailed that the context in which it is being issued since the difficulties was brought to the notice of the CBEC by the INSA stating that the customs field formations are insisting on filing of Import General Manifest (IGM) and BOE "even in respect of those vessels that were imported in the past and which were exempt from payment of import duty." The circular then proceeds to examine the various categories of vessels imported into India. These includes: "(1) Foreign flag vessels, i.e. vessels that have been registered outside India and which carry imported/exported goods or passengers, during its foreign run (voyage from a port outside India to an Indian port, whether touching any intermediate port in India or not; (ii) Vessel entering India for the first time on arrival in the country, for registration as Indian Flag vessel; (iii) Vessels which are intended for conversion from foreign run to coastal run/trade (voyage between two ....
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....arified that all vessels including foreign going vessels for its entry into/exit from the country during its journey as foreign going vessel and the Indian flag vessel/Indian Ship for subsequent use as foreign going vessel would not require filing of IGM and Bill of Entry as conveyance, since the same are not imported goods to be cleared for home consumption. 6. Accordingly, the field formations may adjudicate the cases involving any violation where the IGM or Bill of Entry in respect of vessels were not filed at the time of import, on its first arrival in India or on its conversion into coastal trade and appropriate penal action be taken against the offenders." 25. A careful reading of the above circular reveals that it does not support the contention of Opposite Parties that in the present case where the vessel 'Jag Arnav' has been imported into India way back on 30th April, 2003, the Opposite Parties can insist on collection of CVD at the time of its conversion from a foreign going vessel into a coastal run vessel. 26. This contention also overlooks the settled legal position, which the circular in fact makes abundantly clear, that Notification No.21/2....
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....13. Provisional BOE was filed on 15th February, 2013 and provisional assessment took place. On 9th March, 2013 it reconverted to foreign status at Mundra. 32. Mr. Shah points out how 'Jag Arnav was in foreign status at the time of import and thereafter for nearly ten years. It converted to coastal run status for the first time at Dhamra on 6th January, 2013. It had called on Indian ports on various occasions in 2003, 2008 and 2009. 33. A similar list of dates have been filed for the two other vessels, i.e., 'Jag Ratan' and 'Jag Rani' both of which arrived at Indian port,i.e., Paradeep for the first time on 13th November, 2007 and 26th August, 2011 respectively. Both these vessels have been converted several times from coastal run status to foreign going status depending on the journeys undertaken. On 2nd March, 2013, 'Jag Ratan' reverted to foreign status at Dhamra and 'Jag Rani' on 7th January, 2013. 34. It requires to be noted at this stage that Petitioner No.1 has filed writ petitions both in High Courts of Gujarat and Madras for similar reliefs. In the decision of the High Court of Andhra Pradesh and Telengana Great Eastern Shipping Company v. Deputy ....
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....was issued, customs duty is leviable on every occasion when the vessels in question entered India as a 'conveyance' carrying cargo. In relation to Indian flaggedvessels, as the three in question in this case, at the time of their first entry into Indian waters they are considered as imported 'goods'. Thereafter every time they re-renter these vessels conduct their activity as 'conveyance' as defined under Section 2 (9) of the Act. Such conveyances are not re-imported into India every time they enter Indian waters since they were never 'exported' from India. Section 20 of the Act would, therefore, have no applicability. Only their cargo would be amenable to customs duty, if at all. This position has been explained in Commissioner of Customs, Mumbai v. Aban Loyd Chiles Offshore Ltd. (2017) 3 SCC 211 as under: "13. To appreciate the controversy, it is necessary to understand certain concepts as envisaged under the Act. `Goods' for the purpose of the Act includes vessels, aircrafts and vehicles as defined in subsection (22) to Section 2, yet the distinction has to be recognized between a vessel or an aircraft as a mere good and when the vessel or an aircraft comes to India....