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TMI Blog2015 (2) TMI 738X X X X Extracts X X X X X X X X Extracts X X X X ..... ion if it remains in a stationary position. This is a material and significant difference in the nature of the function undertaken by 'Geo Hind Sagar' when compared with the vessels of CTH 8905. Further from the contracts entered into with ONGC and NACOR, it is seen that the vessel should possess significant navigational capability to undertake and perform the tasks assigned and there are specific standards laid down in this regard. If the vessel has to undertake the survey at constant speed and depth, its navigability can not be said to be subsidiary to its main function and both are equally important. Further as per HSN Explanatory Note, vessels falling under CTH 8906 include scientific research vessels; laboratory ships, etc. within its ambit. It is a settled position in law as held by the hon'ble apex court in the case of Wood Craft Products Ltd. [1995 (3) TMI 93 - SUPREME COURT OF INDIA] that for resolving any dispute relating to tariff classification, a safe guide is the internationally accepted nomenclature emerging from the HSN. Revenue has placed reliance on the principle of NOSITUR A SOCIIS. As per this principle, entries in the schedule of sales tax and excise statute li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 Arya Offshore Services P. Ltd. appointed by the CHA - 25 lakhs - 6 Rajendra Devadiga, Manager Operations of Arya Offshore Services P Ltd - 10 lakhs - 7 Hemant Kumar Joshi, Surveyor of the Indian Register of Shipping - 2 lakhs - Aggrieved of the same, the appellants are before us. 2. The submissions made by the Ld. Counsel for the appellant can be summarised as below:- (a) Dispute pertains to classification of the vessel "Geo Hind Sagar" imported by the appellant, which according to them is classifiable under CTH 8906 of the Customs Tariff whereas the department's contention is that the vessel is classifiable under CTH 8905 of the said Tariff. (b) The vessel, "Geo Hind Sagar" is used for undertaking Seismic study of the ocean floor and its subterranean surface. Seismic vessel is built with many special features including facilities for the seismic research, crew, the instruments, helideck and quiet engines. The vessel mainly contains seismic instruments for recording of seismic data and controlling seismic streamer and energy sources firing. The navigation system consists of linkages to satellites, radio system, compasses, and various posi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... given by Sugao Shipping Japan while classifying the vessel as a 'seismic survey vessel' against Sr. No. 10 gives the details of the navigation equipment which consist of GMDDS, GPS, Radars, Gyro, Wind sensor, Navigatgion Echo Sounder, Electronic Chart, Sonar, Tow system and so on. (f) The Charted Engineer's Certificate dated 7/10/2012 in respect of vessel also gives the vessel particulars and concludes that "Geo Hind Sagar" has to perform her task of conducting the research of sea bed by navigating a vast survey area running into hundreds of kilometres. The navigation of vessel is an important requirement for the activity she conducts. On the basis of survey it has been certified that "Geo Hind Sagar" is a 'Seismographic Research Ship'. (g) In the vessel survey report of Det Norske Veritas, Norway, given in August, 1998, the vessel has been classified as a seismic Research Ship. Further, the Indian Registry of Shipping in the provisional registration certificate dated 22/12/2009 and Final Certificate dated 8-2-2010, had classified 'Geo Hind Sagar' as a 'Seismographic research ship' and accordingly, the vessel was described ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on and the navigational ability of the vessel can not be considered to be subsidiary to its main function. On the other hand CTH 8906 is the residuary entry covering all other vessel not covered by heading 8901 to 8905. In particular, it covers scientific research vessels as is evident from the HSN Explanatory Notes. Therefore, the vessel merits classification under CTH 8906 attracting 'nil' rate of duty. Accordingly he pleads for allowing the appeals. 2.1 The Ld. Counsel for the CHA, J.M. Baxi & Co., their agent, M/s. Arya Offshore Service P. Ltd. and Shri Rajendra Devadiga, Manager (Operations) submits that they had filed the bill of entry and connected import documents, based on the documents given to them and as per the instructions received and accordingly they had classified the vessel as falling under CTH 8906. At the time of import, the custom officers had boarded the vessel and inspected/examined the same and also perused the various documents pertaining to vessel and had provisionally allowed the clearance of the vessel under CTH 8906. Therefore, the CHA and its agents can not be faulted/held responsible for any mis-declaration at all. 2.2 Similarly, the counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is also submitted that in the memorandum of agreement for sale the vessel and the bill of sale dated 10/12/2009, the vessel has been described as a seismic survey vessel. In the application made by the appellant to the Government of India, Ministry of Shipping for the purpose of registration, the appellant has declared the vessel as a seismic survey vessel and even in the technical information pertaining to the vessel, it has been described as a seismic survey vessel. It is accordingly contended that being seismic survey vessel, it can not be equated with a research vessel and therefore, the vessel would merit classification under CTH 8905. Consequently the duty demand confirmed in the impugned order is sustainable in law and the persons connected with the import clearance transaction are liable to penalty for aiding and abetting mis-classification of vessel with an intent to evade customs duty. 4. We have carefully considered the submissions made by both the sides. 4.1 The competing entries of classification are CTH 8905 and CTH 8906 and they are reproduced below:- Tariff item Description of goods 8905 8905 10 00 8905 20 00 8905 90 8905 90 10 8905 90 90 Light-Vessel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vessel". Seismic research is scientific research and therefore, the vessel is a scientific research vessel. There is no evidence produced by the Revenue to the contrary by way of any expert opinion and therefore, the contention of the Revenue that the vessel merits classification under CTH 8905 does not have any sound basis and accordingly, we reject this contention. An argument has been advanced by the Revenue to the effect that a survey vessel cannot be equated with a research vessel. We do not find any rational basis for this argument. The purpose of any scientific survey is to gather reliable data and from the analysis of the data, scientifically valid conclusions can be drawn. Thus collection of data is an integral part of any empirical scientific research and cannot be treated as a separate or distinct activity. 4.4 Revenue has placed reliance on the principle of NOSITUR A SOCIIS. As per this principle, entries in the schedule of sales tax and excise statute list some articles separately and some articles are grouped together; when they are grouped together, each word in the entry draws colour from the other words, therein. If we apply above principle to the fact of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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