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Issues Involved:
1. Whether the oil rigs are `vessels' for the purpose of the Customs Act, 1962 as defined in Section 2(21) thereof? 2. Whether the Petitioners are entitled to get the benefit of Section 86(2) of the Customs Act of transferring the "stores" without payment of Customs duty to oil rigs? 3. Whether the Petitioners are entitled to get the benefit of Section 54 of the Customs Act, 1962, which provides transhipment of goods without payment of duty to any port outside India? Summary: Issue 1: Whether the oil rigs are `vessels' for the purpose of the Customs Act, 1962 as defined in Section 2(21) thereof? The Court analyzed the definition of "foreign-going vessel or aircraft" u/s 2(21) of the Customs Act and concluded that the term "vessel" is of wide amplitude and includes oil rigs. The Court referred to various definitions from the Merchant Shipping Act and dictionaries, concluding that oil rigs, which are capable of engaging in drilling operations, are considered vessels by international standards. Certificates and insurance policies also supported the classification of oil rigs as vessels. Therefore, oil rigs are `vessels' for the purposes of the Customs Act. Issue 2: Whether the Petitioners are entitled to get the benefit of Section 86(2) of the Customs Act of transferring the "stores" without payment of Customs duty to oil rigs? The Court held that since oil rigs are vessels, the Petitioners are entitled to transfer "stores" (meaning goods for use in a vessel, including spare parts and other articles of equipment) without payment of Customs duty u/s 86(2) of the Customs Act. The Court rejected the Respondents' contention that the goods must be warehoused before transferring as stores, stating that it is not necessary for the goods to be warehoused before exporting. Issue 3: Whether the Petitioners are entitled to get the benefit of Section 54 of the Customs Act, 1962, which provides transhipment of goods without payment of duty to any port outside India? The Court considered the alternative submission that if oil rigs are not regarded as vessels, the Petitioners should still get the benefit of Section 54 of the Customs Act. The Court interpreted the term "port" in a broader sense to include any place outside Indian territorial waters, not just customs or revenue ports. Therefore, even if oil rigs are not vessels, the Petitioners are entitled to the benefit of Section 54 for transhipment of goods without payment of duty. Conclusion: The Court declared that oil rigs are vessels for the purpose of the Customs Act, 1962, and the spare parts or equipment for the oil rigs are "stores." The Petitioners are entitled to get the benefit of Section 86(2) of the Customs Act. If the equipment imported by the Petitioners are not considered as "stores," then the Petitioners are entitled to get the benefit of Section 54 of the Customs Act. Each Petition was allowed, and Rule was made absolute to the aforesaid extent, with no order as to costs. The Bonds and Bank Guarantees furnished by the Petitioners shall continue for six months from the date of the judgment.
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