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TMI Blog1998 (11) TMI 217X X X X Extracts X X X X X X X X Extracts X X X X ..... N. Sreekumar, ld. Advocate for appellants and Shri S. Sankara Vadivelu, learned JDR, for Revenue. 3. Learned Senior Advocate submitted as follows :- (1) The Ullage Survey is carried out both at the time of shipment of the goods from the foreign port (as shown in the Bill of Lading), and at the Indian Port of unloading. It is customary for the Captain of the Vessel to enter a protest against the measurements so recorded at the foreign port so as to get over discrepancies which may arise later. (2) In the present case, the goods are pumped through pipelines from the ship at the Cochin Port into the shore tanks of Cochin Refineries Ltd. (CRL) which are situated in its refinery 14 Kms. away. It is CRL s case that the measurement in the shore tanks should be adopted for the purposes of levy of duty. (3) The definitions of the terms import , imported goods , India etc., and Section 12, which is the charging section, contemplate the levy of customs duty on goods imported into India. This would indicate that the levy has to be on goods which are actually imported into India, which is a matter of fact which has to be ascertained. It cannot, in law, be a hypothetical figure. (4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been held that `import takes places no sooner than they enter the `territorial waters of India and does not postpone till the goods are actually offlanded on the land mass in connection with taxable event under the Customs Act. It was also held that the doctrine of original package was not applicable to imports under Customs Act as the said Act had expressed to the contrary in clear and precise language. (iv) 1987 (28) E.L.T. 266 (Mad.) - Lucas TVS, Madras v. Asstt. Collector of Customs, wherein it has been held that the export of goods out of territorial waters of India is not necessary for the purposes of admissibility of drawback allowance as `India in this context is readable as landmass of the country. This holds goods for the word imported into India also. (v) 1989 (44) E.L.T. 464 (Mad.) - Asstt. Collector of Customs (Imports) v. Sundaram Textiles, wherein it has been held that the relevant date for chargeability of import duty is the date of unloading of the goods and not the date of entry into the territorial waters of India. (vi) 1993 K.L.J. (Tax Cases) 98, in the case of The Malayala Manorama Co. Ltd. v. ACC, Cochin, wherein Section 19 of the Kerala General Sal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... actually found on board the vessel at its arrival, the tank measurement is the only method to know the quantity actually discharged and that this should be accepted with respect to Section 116 of the Customs Act. (x) 1988 (36) E.L.T. 667 (Tribunal) - South India Corp. (Agencies) Ltd. v. CC, wherein it is held that short landing of goods is to be determined on the basis of manifested quantity and quantity mentioned in out turn report under Section 116 of Customs Act. (Majority Decision). Thus the said majority judgment holds that the Ullage report is not the material document. (xi) 1989 (42) E.L.T. 204 (Bom.) - Varun Shipping Co. Ltd. v. Govindas S. Tampi, wherein it has been held that Ullage report carried by qualified surveyor is relevant piece of evidence but that the measurement in the shore tank is the more accurate method of measurement for Section 116 of the Customs Act. However, the matter was remanded. (xii) 1992 (61) E.L.T. 500 (G.O.I.) - CC v. Daragh Smail Co. (India) Pvt. Ltd., wherein it has been held that the out turn report issued by Port authorities being a statutory document is to be preferred to a Survey Report which is a non-statutory document and in whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n its entirety, it does not seem to fully accord with the Department s stand that it is the Ullage survey report which is the sole criterion to decide duty liability. 4. Heard learned JDR. He submits that in the scheme of proceedings contained in the Customs Act, 1962 either the manifested quantity is also the quantity declared in the Bill of Entry or if the manifested quantity is different from the quantity in the Bill of Entry and so accepted, then the shortage amounts to short landing and action under Section 116 of the Customs Act is then initiated to penalise the carriers for the differential quantity. Normally, the penalty imposed is atleast equal to duty involved on this differential quantity. In this case, if the Ullage report quantity which tallies with the quantity manifested, was different from the quantity alleged to have been received by appellants, then they should have informed the Custom House at that stage so that necessary action under Section 116 ibid would have been taken. This was not done presumably because the goods were first cleared on into Bond Bill of Entry. 5. Secondly, he submitted that duty on the product imported is on ad valorem basis and therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ide this would be a question of fact and this fact would concern with the quantity to be taken as imported being discharged at the Port. Various judgments noted supra had held that, for the purpose of penalty under Section 116, the quantity discharged should be taken as that given by the Ullage Report. Thus, the argument of the Senior Advocate that even if the quantity determined for the purposes of Section 116 is on the basis of Ullage Report, the quantity for imposition of levy under Section 12 should be the quantity discharged on the land mass and the two are different issues suffers from the infirmity that the two different quantities cannot be accepted to have been imported for the purposes of two different sections of the Customs Act. Therefore, we cannot distinguish between the case-laws which have decided on the manner of determination of quantity imported merely on the grounds that those dealing with Section 116 and the quantity involved therein would not be applicable for determination of quantity imported for levy under Section 12. It would not be the intention of the Legislature to have prescribed two independent sections in a manner that they could be interpreted to ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this case, the question does not concern with the import of goods and it is held that alternative method can be resorted to estimate the quantum of goods in best judgment assessment. The facts of the case therein, therefore clearly are not applicable to the facts of the present case. 15. Furthermore, in the case of Sundaram Textiles - 1998 (44) E.L.T. 464 (Mad.) the issue is the relevant date for chargeability of import duty and not the methodology of ascertaining the quantity imported. Therefore, the said decision is also not applicable to the facts of this case as here the date of charging is not the subject matter agitated in these appeals. 16. As against these, the following decisions have held that the Ullage Report is relevant to determine the quantity of goods imported :- (a) 1996 (85) E.L.T. 254 (T) - In the said decision by this very Tribunal (SZB), the Hon ble Members have held that the lower authority shall consider the Ullage Report in terms of the decision of the Hon ble Bombay High Court as in 1986 (25) E.L.T. 948 (Bom.) (Shaw Wallace Co. Ltd.). (b) In 1996 (25) E.L.T. 948 (Bom.) - Shaw Wallace Co. Ltd., the Hon ble Bombay High Court (Single Judge Bench) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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