1988 (11) TMI 251 - AT - Central Excise

Summary

Issues:
- Whether the vessel's voyage from one Indian port to another constitutes a coastal run or qualifies as a foreign-going vessel.
- Whether the ship stores consumed during the voyage are exempt from duty under Section 87 of the Customs Act.

Analysis:
1. The appeals before the Appellate Tribunal CEGAT, New Delhi, involved common questions of law and facts from two separate orders-in-appeal passed by the Collector of Customs (Appeals), Bombay.

2. The Tribunal heard both appeals together and rejected them on the grounds that the vessel in question arrived with cargo from Kuwait and Doha, then loaded additional cargo at Okha for Bombay, leading to a dispute over the classification of the voyage as coastal run or foreign-going vessel.

3. The respondents sought a refund of duty collected by Customs, arguing that the vessel should be considered a foreign-going vessel. The Collector of Customs (Appeals) allowed the appeal based on a judgment of the Bombay High Court in a similar case involving the Great Eastern Shipping Co. Ltd.

4. The Collector of Customs and Central Excise, Rajkot, appealed against the orders allowing the refund of duty, leading to the current appeals before the Tribunal.

5. During the hearing, the respondents relied on the Bombay High Court's decision in a previous case involving the Great Eastern Shipping Co. Ltd., arguing that the issue in the present appeals was similar and should be dismissed accordingly.

6. The appellant Collector contended that the Bombay High Court's decision was not applicable to the current appeals, emphasizing the need to examine the facts and the legal principles involved in the previous case.

7. In the previous case before the Bombay High Court, the issue revolved around the classification of a vessel as a foreign-going vessel despite carrying coastal cargo between Indian ports, leading to a dispute over the exemption of duty on ship stores consumed during the voyage.

8. The Bombay High Court's decision emphasized that the vessel's engagement in carrying goods between Indian and foreign ports, even if carrying coastal cargo, did not disqualify it as a foreign-going vessel under the Customs Act.

9. The Tribunal noted that the facts of the current appeals mirrored those of the previous case, and the vessel's voyage from Kuwait and Doha to Bombay could not be considered a coastal run based on the principles established by the Bombay High Court.

10. Consequently, the Tribunal rejected the appeals, affirming that the ship stores consumed during the voyage from Kuwait and Doha to Bombay were exempt from duty under Section 87 of the Customs Act, in line with the Bombay High Court's decision.