2014 (6) TMI 783 - AT - Customs

Waiver of pre deposit - duty on broken pieces of wrecked ship - Customs included the cost of the broken ship, salvaging cost, transportation of broken pieces, etc. and as a result, differential duty - Held that - wrecked ship when purchased had already reached Indian shore and therefore importation has already been taken place. Therefore, the issue is debatable and requires more detailed consideration of relevant provisions, relevant rules, precedent decisions on the subject. - Commissioner (Appeals) could have passed an order without insisting on any pre-deposit. - stay granted.

Summary

Issues involved:
Dismissal of appeal for non-compliance with stay order requiring pre-deposit of Rs. 40 lakhs, interpretation of Customs duty calculation including all costs, applicability of precedent decisions, remitting the matter to Commissioner (Appeals) for decision on merits without pre-deposit.

Analysis:
The judgment by the Appellate Tribunal CESTAT Bangalore involved the dismissal of the appellant's appeal due to non-compliance with a stay order mandating a pre-deposit of Rs. 40 lakhs. The appellant had purchased a wrecked ship, which was broken into pieces, transported to shore, and taken to a private bonded warehouse. The Customs assessed the broken pieces, demanding a differential duty of Rs. 78.07 lakhs. The key issue was whether the appellant was required to make the pre-deposit. The Tribunal considered the question of including all costs in the calculation of Customs duty. The appellant relied on a precedent decision of the Larger Bench regarding the assessable value of goods, but the Tribunal found the issue in this case to be different. They noted that the wrecked ship had already reached Indian shore upon purchase, leading to a debatable issue requiring detailed consideration of relevant provisions and precedent decisions.

The Tribunal opined that the Commissioner (Appeals) could have decided the matter without insisting on any pre-deposit at that stage. Consequently, they set aside the impugned order and remitted the matter back to the Commissioner (Appeals) with a direction to decide on the merits without requiring any pre-deposit. The appellant was to be given a reasonable opportunity to present their case before the order was passed. The judgment highlighted the importance of a thorough analysis of relevant provisions and precedent decisions in determining Customs duty calculation, emphasizing the need for a fair consideration of the facts and circumstances of each case before imposing pre-deposit requirements.