2010 (10) TMI 294 - AT - Customs

Confiscation - Pre-mature proceedings - once notification has been issued by the Board under Section 7 of the Act specifying the port for unloading of import goods and loading of export goods or any class of such goods, it was not open to the Commissioner to hold that the jetty was a captive jetty of M/s. Essar Oil Ltd. (the second appellant) and only their goods could have been unloaded; this contention sets to naught provisions of Section 7 and the notification issued there under - in the absence of a notification by Commissioner after the issue of notification by the Board, the custodian and the appellants should not have landed and unloaded the goods - Section 111(a) of the Act provided for confiscation of any goods which are unloaded at any place other than a customs port appointed under clause (a) of Section 7 of the Act - impugned order has been passed without considering the representation made by the appellants for post-facto permission and in view of the fact that Section 33 of the Act provides for permission - Decided in the favour of the assessee

Summary

Issues Involved:
1. Legality of unloading imported goods at Vadinar Port.
2. Authority and scope of notifications under Sections 7 and 8 of the Customs Act, 1962.
3. Validity of confiscation and penalties imposed on the appellants.
4. Consideration of ex-post-facto permission for unloading goods.

Detailed Analysis:

1. Legality of Unloading Imported Goods at Vadinar Port:
The primary issue revolves around whether the goods imported by the appellants were legally unloaded at Vadinar Port. The appellants argued that Vadinar Port was notified by the Central Government as a Customs Port for the import of all goods under Section 7(a) of the Customs Act, 1962. However, the Commissioner of Customs, Ahmedabad had approved Vadinar Port for unloading only specific goods related to the Essar Oil Refinery Project under Section 8(a) of the Act. The appellants contended that the notification under Section 8 should be read harmoniously with Section 7, and the Commissioner had no authority to restrict the unloading to specific goods once the port was notified under Section 7.

2. Authority and Scope of Notifications under Sections 7 and 8 of the Customs Act, 1962:
The legal provisions under Sections 7 and 8 of the Customs Act were scrutinized. Section 7 allows the Board to appoint customs ports for unloading and loading goods, while Section 8 empowers the Commissioner to approve specific places within these ports for such activities. The appellants argued that once a port is notified under Section 7, the Commissioner cannot restrict the unloading to specific goods under Section 8. The Tribunal found force in the appellants' submission that Vadinar Port was a customs port for all goods after the 2005 notification by the Board and that the Commissioner's notification under Section 8 should not limit this scope.

3. Validity of Confiscation and Penalties Imposed on the Appellants:
The goods were confiscated under Section 111(h) of the Act for being unloaded at an unauthorized place, and penalties were imposed on the appellants. The Tribunal noted that the proper officer for granting permission under Section 33 of the Act was the Assistant Commissioner/Deputy Commissioner, and the goods were unloaded under the supervision of customs officers who were not authorized to grant such permission. The Tribunal observed that the proper officer has the authority to grant permission for unloading even at places not approved under Section 8, and this power was not exercised in this case. The Tribunal concluded that the proceedings were premature as they were initiated without considering the appellants' request for ex-post-facto permission.

4. Consideration of Ex-Post-Facto Permission for Unloading Goods:
The appellants had sought ex-post-facto permission for unloading the goods, which was not considered by the Commissioner. The Tribunal emphasized that Section 33 allows the proper officer to grant such permission, and the failure to consider this request rendered the proceedings premature. The Tribunal highlighted that the customs officers' omission to seek or grant post-facto approval contributed to the situation and that the appellants should not be penalized for this oversight.

Conclusion:
The Tribunal set aside the impugned orders, stating that the proceedings were premature and should have been initiated only after the proper officer had considered and rejected the appellants' request for ex-post-facto permission. The Tribunal granted consequential relief to the appellants, emphasizing that the proper officer's power to grant permission under Section 33 should have been exercised in this case.