9911796707
TMI Blog2007 (11) TMI 185X X X X Extracts X X X X X X X X Extracts X X X X ..... t of its size and having regard to draft restrictions. The imported material had to be thus pumped into the shore tanks of the concerned agency namely the importer IFFCO. A certificate was issued on 20.11.1982 by M /s Ericson and Richards as to the quantities. According to this report (hereinafter referred to as "the Ullage Report"), the quantity ultimately pumped into the shore tanks were 3103 MT. Though the bill of lading or the manifest of the vessel showed 3296.801 MT of phosphoric acid, the bill declared affirmed 3262 MT and ultimately 3103.152 MT was found as the correct figure in the Ullage report. 3. The customs authorities issued a show cause notice calling upon the petitioner to satisfy it as to why penalty in terms of Section 116 of the Act ought not be imposed for the short landed goods. The proceedings were resisted; eventually an order was made by imposing a penalty of Rs. 4,30,000/- upon the petitioner, on 30.9.1998. This order was appealed against; the Collector of Customs (Appeals) by order dated 1.9.1989 reversed the Adjudicatory order and remitted the matter for fresh consideration, to the adjudicating authority i.e. Deputy Collector of Customs at Kandla. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rked- out by the independent surveyors had been allowed to be over- carried on the board, it is evident that the steamer agents cannot be held responsible for such type of shortages. Thus, the fact of issue of the credit note in the case and the quantity of unpumpable sludge left on board the five vessels, cannot be ignored, which should be considered while working out the short landings. This quantity of sludge is the required to be allowed over and above the ocean loss allowing of 2%, while working out the quantity of short landings, 12. It is also noticed that the rate of duty taken by the adjudicating authority in the first three cases ( sl.no.1 to 3) for working out the quantum of penalty as not correct, as the concessional rate of duty charged on the consignments in question, has not been taken into account. Section 116 of Customs Act, 1962 provides that in case of shortage in the quantity unloaded, penalty not exceeding twice the amount of duty that would have been chargeable on the goods not unloaded, had such goods been imported, can be imposed on the person in-charge of the vessel. Thus, the amount of penalty that can be imposed under Section? 116 is directly related t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation the quantity of sludge, with the permission of custom, the balance short landed quantity of 2.570 MT and 34.449 MT respectively, in the two cases, is within the permissible ocean loss allowance. In view of this matter, there has been no short landing in respect of these two cases. As such, the two impugned orders are set aside and the two appeals are allowed? 7. The Government of India was apparently moved under Section 129-D of the Customs Act for review of the appellate order dated 25.11.1991. It issued a show cause notice to the petitioner and after considering the materials set aside the appellate order. The relevant part of the discussion of the revisional authority is as follows : "Taking up the second ground first, Government is of the considered view that notification 166/76 is a conditional exemption based on fulfillment of end use condition. The impugned short landed quantities were not utilised for the end-use prescribed in the said notification and, therefore, the concessional rate of duty prescribed therein cannot be applied for purpose of calculating the quantum of penalty. To that extent the review proposal succeeds. Regarding the first point relati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the applicability of any of the judgments even though the desirability of accepting the ullage report to determine the extent of ocean allowance for penalty under Section 116 in such cases , was relevant. 10. Learned counsel submitted that the second issue decided by the revisional authority i.e. regarding the inapplicability of concessional rate of duty, in case the action against Section 116 was to be sustained was erroneous. It was submitted that even in case of short landings the authorities were duty bound to give the petitioner the benefit of the rate of duty notified under Section 25 of the Customs Act which was 15% whereas what was actually taken into consideration while reckoning the penalty was the amount enacted in the schedule. Learned counsel relied upon the judgment of the Calcutta High Court in Estate Shipping Vs. Deputy Collector of Customs Civil Order No.8696/12decided on 10.7.1992. 11. Mr. Katyal, learned counsel for the respondent resisted the petition and submitted that the revisional order impugned in these proceedings was justified in the circumstances. He submitted that at an intervening stage the Collector of Appeals had remanded the matter for r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chargeable on the goods are unloaded. It can be seen that is a penal provision and presumptive in that once the opinion is formed that the short delivery is not satisfactorily accounted for, the levy is attracted. 15. The question which arises here is whether the decision of the Central Government to reverse the Appellate order is justified. The Appellate order considered the peculiar characteristics of the goods i.e. phosphoric acid and concluded that it had propensity for sludge formation. It was not disputed that none of the significant characteristics i.e. the real possibility of sludge formation, having regard to the climate and the other variables on account of a long voyage, exist. The reasoning of the adjudicating authority was that allowance only to the extent of 2% was permissible and any sludge formation beyond that was not permissible as there was no authority for him to permit such allowance. The adjudicating authority did not go into the nuances of merits of the acceptance or the veracity of the ullage report. However, the Appellate Authority not only considered the peculiar characteristics of the goods but also the law on the aspect and apparently took into accou ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
