2015 (11) TMI 1399 - AT - Customs

Confiscation of vessel - whether there was a deliberate attempt to export the old and used vessel in the garb of a new one - respondent stated that only a Free Shipping Bill had been filed. They only wrote to Assistant Commissioner for Drawback Registration and later withdrew their request. - Imposition of penalty - Duty drawback claim - Mis-declaration - Held that - Under Drawback Rules, old and used goods are ineligible for drawback. This report of Superintendent which is countersigned by the Assistant Commissioner on 19.12.2012 is written on the respondent s request letter of 14.12.2012. But the A.C. did not order any action such as seizure of the vessel. It appears that the vessel was seized initially for failure to pay Central Excise duty. However, we understand that the non-payment of Central Excise duty is a matter of separate proceedings under the Central Excise Act. This seizure by Central Excise authorities was effected on 26.12.2012. Till this time there was no proposal to seize the vessel for attempt to export which would have made it liable for confiscation under Section 113h(ii). If indeed there was a deliberate attempt to export the vessel by fraudulently mis-declaring it as a new vessel, the question arises why Customs did not find it appropriate to seize the vessel. There is no offence committed if exporter makes preparation to claim drawback by preparing the job card to expedite matters. Viewed legally, we find that the only Shipping Bill with the Customs was the Free Shipping Bill. Regulation 4 of the Regulations clearly states that Shipping Bill shall be deemed to have been filed when, after entry of Electronic Declaration in the EDI System, a number is generated for the said declaration. We find in the present case the number was not generated. Moreover Revenue has not been able to Ray hands on any documents such as log-book that indicate that appellant had deliberately concealed the fact that the vessel is old and made coastal runs. - Decided against the revenue.

Summary

Issues:
1. Stay application against the Order-in-Appeal confiscating the vessel and imposing penalties.
2. Alleged attempt to export an old and used vessel under the guise of a new one.
3. Dispute over the filing of a Free Shipping Bill and the subsequent request for drawback claim.
4. Central Excise duty non-payment and its impact on the export process.
5. Legal interpretation of regulations regarding the filing of Shipping Bills and eligibility for drawback claims.

Analysis:

1. The case involved a stay application against the Order-in-Appeal that confiscated a vessel and imposed penalties on three respondents. The Commissioner (Appeals) held that only a Free Shipping Bill was filed, and there was no mis-declaration to warrant confiscation under Section 113(h) (ii) of the Customs Act.

2. The main issue was whether there was a deliberate attempt to export an old and used vessel under the guise of a new one. The Customs authorities seized the vessel initially for non-payment of Central Excise duty, but the question of deliberate mis-declaration was raised. However, the tribunal found no evidence of deliberate concealment or misrepresentation to seize the vessel under Section 113h(ii).

3. The dispute arose from the filing of a Free Shipping Bill initially, followed by a request for drawback claim, which was later withdrawn after Customs inquiries. The tribunal noted that the only Shipping Bill with Customs was the Free Shipping Bill, and no number was generated in the EDI system for the declaration of a drawback Shipping Bill.

4. The non-payment of Central Excise duty on the vessel led to its seizure by Central Excise authorities. The tribunal clarified that the non-payment of Central Excise duty was a separate proceeding under the Central Excise Act and not directly linked to the alleged attempt to export the vessel under false pretenses.

5. The legal interpretation focused on Regulation 4 of the Shipping Bill (Electronic Declaration) Regulations 2011, which states that a Shipping Bill is deemed filed only when a number is generated in the EDI system. The tribunal found that no number was generated in this case, and there was no evidence of deliberate concealment or misrepresentation to warrant confiscation.

In conclusion, the tribunal dismissed the stay petition, emphasizing that there was no evidence of deliberate misrepresentation or concealment to seize the vessel. The legal interpretation of regulations and the lack of generated numbers for the declaration supported the decision to uphold the Order-in-Appeal.