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TMI Blog2005 (1) TMI 571X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the vessel during the relevant period. They imported certain ship stores through Air Customs, Chennai and Mumbai. On an application from the Respondent, Chennai Customs allowed transhipment of the ship stores without payment of duty for placing on board the vessel at Kakinada. The transhipments was done under Chapter (VIII) of the Customs Act 1962. 2.The Commissioner of Central Excise Visakhapatnam proceeded against the Respondent demanding duty of Rs. 33,42,556/- on the following grounds : (1) Ship stores when imported into the country should pay duty. (2) Transhipments under Section 52 Chapter (VIII) is not applicable to ship stores. (3) The fact that the goods were meant for ship stores was not informed to the Cu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion to demand duty is with the port of importation. 2. When a notice in terms of Section 28(1) of the Customs Act, 1962 was already issued vide F. No. S. Misc. 515/2000-ACC, dated 19-8-2000 by the Deputy Commissioner (Transhipment) Chennai to M/s. Chandra Maritime (P) Ltd., the Commissioner should not have adjudicated the case for want of jurisdiction. Therefore the Commissioner had no jurisdiction to drop the proceedings . 4.Shri R.V.Ramakrishnappa, learned JDR appeared for the Department and Miss R. Devika learned Advocate appeared for the respondents. 5.The learned JDR stated that the Commissioner of Central Excise Visakhapatnam has no jurisdiction to decide the case as the import took place at Chennai and Chennai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions do not apply to baggage, goods imported by post and stores. Hence the Chennai Customs have not followed the correct procedure in allowing transhipment of stores under Section 54. In the transhipment application, the respondents have indicated that the goods are spare parts for ships. It is also mentioned that these goods are to be placed on board the vessel Algosaibi . Under these circumstances it is not correct to hold that the respondents have suppressed the fact that the goods are ship stores since the transhipment has been done only with the permission of the Customs by following the procedure for transhipment. The department has to take the responsibility for following the wrong procedure. We agree with the Revenue s conten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, are liable to imposition of import duties. The above observation of the Adjudicating Authority is not in consonance with Customs Act. First of all, transhipment provisions under Chapter (VIII) are not applicable to ship stores. Secondly, as per Section 87, imported stores may be consumed without payment of duty, only on board a foreign going vessel repeat foreign going vessel. In the case at instance, the Customs authorities knowingly or unknowingly have permitted imported stores on board a coastal vessel without payment of duty. It is a common procedure in Customs that whenever a foreign going vessel is converted to coastal run, an inventory of goods is taken and duty is required to be paid within a week. When the vessel is converted ag ..... X X X X Extracts X X X X X X X X Extracts X X X X
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