2010 (4) TMI 948 - AT - Customs

Summary

Issues Involved:

1. Waiver of pre-deposit and stay of recovery of demand of duties and penalties.
2. Eligibility for exemption under Notification No. 21/02-Cus. and Notification No. 6/06-C.E.
3. Interpretation of non-scheduled (passenger) services and non-scheduled (charter) services.
4. Applicability of limitation period for the demand.

Summary:

1. Waiver of Pre-deposit and Stay of Recovery:
The applications seek waiver of pre-deposit and stay of recovery of the demand of duties confirmed against the assessee companies, penalties imposed on them, and on their Managing Directors.

2. Eligibility for Exemption:
The appellant companies imported helicopters availing exemption u/s Sl. No. 347B of Notification No. 21/02-Cus. and Notification No. 6/06-C.E. The authorities found that the helicopters were leased on long-term charter, violating the exemption conditions. The Commissioner demanded duties, found helicopters liable for confiscation u/s 111(d) and 111(o) of the Customs Act, and imposed penalties u/s 112 of the Customs Act.

3. Interpretation of Non-scheduled Services:
The appellants argued they conducted non-scheduled (passenger) services as per condition 104 of the Notification and had necessary approvals. The Commissioner interpreted that non-scheduled (passenger) services should satisfy all elements of scheduled (passenger) services except scheduling. The Commissioner found that the appellants did not have a published tariff, thus not qualifying for non-scheduled (charter) services. The Tribunal found the Commissioner's interpretation justified and noted that the appellants did not convincingly establish their case.

4. Applicability of Limitation Period:
In the case of UHPL, the appellants argued the demand was barred by limitation. The Tribunal noted there was no charge of suppression of facts, fraud, or willful misstatement. The demand was based on a bond executed by the appellants. The Tribunal found a strong prima facie case against the demand on limitation for UHPL and ordered complete waiver of pre-deposit and stay of recovery.

Conclusion:
The Tribunal ordered KRACPL to make a pre-deposit of 50% of the duty demanded within 12 weeks, with the balance dues and penalties stayed pending appeal. For UHPL, the Tribunal granted complete waiver of pre-deposit and stay of recovery pending appeal.