2007 (6) TMI 211 - AT - Customs

Ship breaking activity whether bunkers, consumable stores such as drinks, foods stuff are dutiable assessee submit that tanks used for storing fuel are machines - term ship cannot be construed to include everything kept in the ship as claimed by the appellants - therefore fuel oil/bunkers and stores are dutiable further landing charges are includible as these are associated with ship includibility of landing charges doesn t depends on time of payment of duty or date of filing of B/E

Summary

Issues:
1. Appeal against the rejection of refund claim for duty on fuel oil classification.
2. Challenge of duty on fuel oil and provisions, inclusion of landing charges in vessel value for customs duty.

Analysis:

Issue 1: Appeal against the rejection of refund claim for duty on fuel oil classification:
- The appeal (C/900/03) was filed against the rejection of a refund claim for duty on fuel oil by the Commissioner (Appeals) and the original authority.
- The appellant imported a vessel for breaking and filed a refund claim seeking classification of fuel oil under a different heading to avoid duty.
- The original authority and Commissioner (Appeals) rejected the refund claim, upholding the classification and duty payment on fuel oil separately.
- The appellant argued that fuel oil in the vessel should be considered part of the vessel itself and not separately dutiable.
- The tribunal considered CBEC guidelines and international norms, concluding that the duty on fuel oil and ship stores was correctly levied, rejecting the appeal.

Issue 2: Challenge of duty on fuel oil and provisions, inclusion of landing charges in vessel value for customs duty:
- Another appeal (C/901/03) involved the challenge of duty on fuel oil and provisions, as well as the inclusion of landing charges in the vessel's value for customs duty assessment.
- The appellant contested the duty on fuel oil and questioned the addition of landing charges in the vessel's value for customs duty calculation.
- The Commissioner (Appeals) upheld the duty on fuel oil and provisions, and the inclusion of landing charges in the assessable value of the vessel, citing Customs Valuation Rules.
- The tribunal concurred with the Commissioner's findings, emphasizing that landing charges are to be included in the assessable value of imported goods, as per legal provisions and a Supreme Court ruling.
- The appeals were deemed meritless and rejected, along with the cross-objections.

This judgment clarifies the classification and duty implications of fuel oil and ship stores in vessel imports, emphasizing adherence to CBEC guidelines and international norms. It also affirms the inclusion of landing charges in the assessable value of imported goods, following legal provisions and a Supreme Court precedent.