2014 (8) TMI 734 - HC - Customs

Benefit of exemption under nine Bills of Entry under Sl.No.227 of Notification No.23 of 1998-Cus. dated 02.06.1998 - Misdeclaration of goods - Held that - Revenue having noticed that the issue involves rate of duty on the imported equipments by interpreting Notification No.23 of 1998-Cus. and has taken the matter to the Supreme Court as against the order of the Tribunal, ought not to have filed an appeal before this Court. Hence the proper course for the Revenue would be to file an appeal before the Supreme Court as against the order of the Tribunal, as the question involves rate of duty for the goods imported and whether it should be on the merit or on the benefit of notification as claimed - appeals filed by the Revenue as against the order of the Tribunal are pending before the Supreme Court, we are unable to proceed further in this matter except directing the Revenue to pursue the matter before the Apex Court, if they are so advised - Decided against Revenue.

Summary

Issues:
1. Interpretation of whether fitment of new GMDSS Equipments on a vessel constitutes repair of the vessel.
2. Acceptance of Bill of Entry by a ship repair unit to avail exemption under Notification No.23/98.
3. Jurisdiction of the Tribunal to pass an order against established legal principles and documentary evidence.

Analysis:
1. The case involved the import of Global Marine Distress Safety Systems (GMDSS) by a ship repair unit registered with the Director General of Shipping, Government of India. The Commissioner of Customs denied the benefit of exemption claimed by the importer, alleging misdeclaration of the equipment's intended use. The Tribunal, citing a previous case, concluded that the import of equipment was for making the ship sea-worthy, constituting ship repair and entitling the importer to the exemption under Notification No.23/98-Cus. The Tribunal also ruled against the duty and penalty imposed by the Commissioner, leading to the Revenue filing Civil Miscellaneous Appeals.

2. The Tribunal's decision was based on the similarity of facts with a previous case, A.S.Moloobhoy & Sons v. CC (Adj.), Mumbai. Both the appellant/Revenue and the respondents acknowledged the resemblance between the cases and the pending appeals before the Supreme Court related to the earlier case. The Revenue and the respondents requested the High Court to consider the pending appeals before disposing of the present appeals. The High Court emphasized that the Revenue should pursue the matter before the Supreme Court due to the involvement of duty rate interpretation under Notification No.23/98-Cus.

3. The High Court noted that since the issue of duty rate interpretation was already under consideration by the Supreme Court in the pending appeals related to a similar case, it was inappropriate for the Revenue to file separate appeals before the High Court. Consequently, the High Court directed the Revenue to continue pursuing the matter before the Supreme Court and disposed of the Civil Miscellaneous Appeals accordingly, without proceeding further in the case. The judgment highlighted the importance of maintaining consistency in legal proceedings and the need for the Revenue to address the duty rate issue through the appropriate legal channels.

In conclusion, the High Court's judgment focused on the interpretation of the importation of GMDSS equipment by a ship repair unit, the applicability of exemption under Notification No.23/98-Cus, and the necessity for the Revenue to address duty rate issues through the pending appeals before the Supreme Court, rather than filing separate appeals before the High Court.