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Issues:
1. Applicability of customs duty on confiscated trawlers purchased for deep-sea fishing. 2. Interpretation of Notification exempting ocean-going vessels from customs duty. 3. Claim for refund of customs duty by the respondent. 4. Applicability of sub-section (5) of Section 27 of the Customs Act. 5. Effect of change in law during pendency of appeal on refund claims. 6. Discharge of bank guarantee post judgment. Analysis: 1. The case involved a dispute regarding the applicability of customs duty on three confiscated trawlers purchased for deep-sea fishing and export. The respondents argued that they were exempt from customs duty under a government notification, as the vessels were intended for a specific purpose of deep-sea fishing. 2. The Notification dated October 11, 1958, exempted ocean-going vessels from customs duty unless they were subsequently broken up. The respondents contended that this exemption applied to their trawlers purchased for deep-sea fishing, and therefore, they were entitled to a refund of the customs duty paid. 3. The respondents claimed a refund of the customs duty amounting to Rs. 6,81,923, which was 51.7% of the bid value. Despite initial rejection by the Assistant Collector of Customs, the Customs, Excise and Gold (Control) Appellate Tribunal allowed the refund claim, subject to a personal bond/guarantee to ensure the trawlers were not broken up. 4. The Tribunal's decision was challenged by the Customs Authorities, questioning the applicability of sub-section (5) of Section 27 of the Customs Act to the refund claim. The Tribunal's rejection of the reference application was based on the clear applicability of sub-section (5) to the facts of the case. 5. The Customs Authorities argued against the refund, citing the realization of customs duty and the impact of a change in law with the introduction of sub-section (5) of Section 27. However, the court held that the change in law during the pendency of the appeal would govern the rights of the parties, and sub-section (5) was applicable to the case. 6. Ultimately, the court dismissed the appeal and the reference application, upholding the Tribunal's decision to grant the refund. The bank guarantee furnished by the respondent was discharged post-judgment, affirming the entitlement to the refund of customs duty. This detailed analysis covers the key issues and legal interpretations involved in the judgment, providing a comprehensive understanding of the case.
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