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TMI Blog2018 (11) TMI 370X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot be classified under the head of ‘Dredgers’ and will be classifiable under the respective head of individual parts. Held that:- In the peculiar facts of the present case, there is no difference in the nature of the goods imported with three dredgers and goods imported subsequently under two bills of entry dated 07.02.2017. It is also not disputed that whether the same parts and accessories i.e. pontoons, pipes etc. imported with first consignment and similar items imported in the second consignment were used put together for the activity of dredging for their clients. Both the consignments were imported by the appellant for only one project. Since the dredger and its parts are huge in size and quantity, it is not possible to import the entire consignment at a time. Therefore, the entire goods were imported in piece-meal. However, all the goods presented together would constitute dredger and then only it can be used for the work assigned to the appellant. From the facts of the case, even though the same parts were imported along with three dredgers but the remaining parts which were imported subsequently which are subject matter of this case were used for the same work in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Contract with M/s. Swan LNG Pvt. Limited for carrying out dredging and reclamation in sea coast , near Jafrabad, Pipavav. They had imported three old and used Dredgers, one Barge, two self propelled Multicat along with accessories, pipelines and pontoons required for dredging operation at Pipavav Port in the month of January 2017 as detailed below: Sr. No. Bill of Entry No. Date Description of goods 1 8142628 10.01.2017 Al-Mirfa, Kattouf Dredger & Belyryar, Multicat 2 8145408 10.01.2017 Embarka-5 Dredger, M6 Multicat 3 8134925 10.01.2017 Barge Fidelia 4 8141458 10.01.2017 Crawler Crane Further, in the month of February 2017, they imported "Old and Used Pipelines, Pontoons etc." declaring the same to be integral part of the dredgers already imported by them in January 2017, the details are as under:- Sr. No. BE No. & Date Declared description of the goods Declared CTH 1 8465433/ 07.02.2017 Old & used Pontoons, Integral Parts of Dredger "AI Mirfa, Kattouf and Embarka-5" 89011090 2 8465442/ 07.02.2017 Old & Used various types of Pipe Lines, Elbow, Fittings & Equipments, Integral parts of Dredger "AI Mirfa, Kattouf and Embarka-5" 89051000 The appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous types of pipelines, elbow, fittings & equipments, integral parts of the dredgers Al- Mirfa, Kattouf and Embarka - 5" in the Bill of Entry No. 8465442 dated 07.02.2017 and order reclassification of the pipes, pipe fittings like elbow, water box, Y-piece, shore connection, gate valves etc., cutter heads, cutter motors and side winch motor are falling under CTH 73049000,73072900, 73269080, 85015390 of Customs Tariff Act, 1975 respectively as proposed in show cause notice. (iii) I confirm the demand of differential duty amounting to ₹ 8,68,74,159/- (Rupees Eight Crore Sixty Eight Lakh Seventy Four Thousand One, Hundred Fifty Nine only) under Section 28(4) of the Customs Act, 1962 along with appropriate interest in terms of section 28AA of the Act and order for recovery of the same from M/s. National Marine and infrastructure India Pvt. Limited, 404, 4th Floor, Centre Point, Andheri Kurla, JB Nagar, Andheri East, Mumbai-400059. (iv) I order to appropriate the duty of ₹ 8,68,74,159/- (Rupees Eight Crore Sixty Eight Lakh Seventy Four Thousand One Hundred Fifty Nine only) And interest ₹ 18,85,051/- (Rupees Eighteen Lakh Eighty five Thousand Fifty One only) already ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on that basis cannot be different from the admitted classification of the same goods imported with Dredgers. He submits that similar items which are parts of dredger and imported along with Dredger were admittedly classified under the head of dredger as accessories. Therefore the same items imported for the same purpose, cannot have a different classification. He referred to Note of Section XVII of first Schedule to Customs Tariff Act and submits that the said Section excludes certain goods from the whole of the Section of the schedule. The subject goods are not covered under any exclusive clause of the said note. He referred to British Standard, Part V in respect of CSD Dredgers and according to which a cutting suction dredgers is desired in four parts i.e. (i) Main Platform, (ii) Pipeline, (iii) Anchors and (iv) Cutter Heads. According to this standard, cutting suction is essential part of the complete cutter suction dredger. He submits that the pipelines, pontoons and equipment imported along with dredgers and additional same goods imported subsequently, are of the same nature and to put together for carrying out the contract. Therefore, there is no difference between the pipel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ported subsequently and all put together to use for execution of the project without which the operation of dredging to complete the work was not possible. Therefore, three CSD dredgers which are complete not only with the parts imported along with but with subsequent imports. Therefore, for the purpose of classification, both the consignments cannot be treated differently. 2.1 Ld. Counsel further submitted that the contention of the Revenue that second consignment has been invoiced separately as well as it does not constitute integral part of the three dredgers, is totally incorrect, in view of the fact that any consignment is dissembled into parts for the purpose of import then separate invoicing is done as per international shipping documents requirement and is done accordingly. He submits that pipes, elbows, fittings and pontoons imported in the second consignment clearly mentioned that the same constitute integral equipments of three dredgers already imported. Therefore, there should not be any doubt that the second consignment consisting of pipes, pontoons were essential part and parcel of the first consignment. He submits that the Adjudicating Authority has failed to refer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the present case also, the second consignment, though supplied subsequently but it is for the use along with three dredgers and no separate charge was made as the supply is for the completion of the project and not for sale of goods as such. He submits that the word 'along with' does not mean 'together-with' in the sense as sought to be construed by the Revenue. He submits that in the case of dredgers, it is not possible to transport the entire dredger in one consignment and therefore, it has to be transported in dissembled condition. Only due to this reason, the Accessories (Condition) Rules, 1963 cannot become inapplicable. 2.2 Ld. Counsel further submits that it is not a case that dredger and pontoons, pipes and equipments imported together were only sufficient to carryout the dredging activity. The dredger Kattouf began on 25.01.2017 and dredger Al Mirfa began dredging on 06.02.2017. The pipelines and pontoons imported with dredgers were used to start the work but for completion second consignment was imported and the goods were imported with dredger or imported in second consignment were together used for the same dredging activity. Therefore, the provisions of Accessories (C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CESTAT Ahmedabad (c) CC vs. Gaurav Enterprises - 2005 (9) TMI 99 - High Court Bombay 3. As regards confiscation of the goods, he submits that since, the appellant have correctly declared the description of the goods imported, the good are not liable for confiscation. He placed reliance on the decision of this Tribunal in the case of PSL Limited & Ors vs. CC, Kandla - 2014 (5) TMI 789-CESTAT Ahmedabad. Based on the above submissions, he prays to set-aside the impugned order and allow the appeals. 4. Shri Jeetesh Nagori, ld. Additional Commissioner (AR) appearing on behalf of the Revenue reiterated the findings of the impugned order. He submits that in the present case, it is not disputed that pontoons, pipes and other parts in question were not presented together with the dredgers for assessment. The said goods were imported separately therefore, it is excluded from Chapter 89 and the same are correctly classifiable under respective headings. He referred to Accessories (Condition) Rules, 1963 and submits that the claim of the appellant that the goods are accessories parts of dredger, is not acceptable for the reason that as per the said Rules, accessories parts should be suppl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellant for only one project. Since the dredger and its parts are huge in size and quantity, it is not possible to import the entire consignment at a time. Therefore, the entire goods were imported in piece-meal. However, all the goods presented together would constitute dredger and then only it can be used for the work assigned to the appellant. As regards the heavy reliance made by the Adjudicating Authority on Note 2 of Section XVII of Customs Tariff Act, we find that certain goods, for the purpose of classification, were excluded from the second schedule but floating pipes, pontoons specially designed and components of CSD dredgers are not covered under any exclusion clause. We observed that as submitted by the ld. Counsel, the dredgers does not mean the bare dredger but it consists of four part i.e. (a) Main Platform, (b) Pipelines (c) Anchors (d) Cutter Heads. As per the British Standard BS-6349, the dredger consist of all the above four parts which include pipelines and pontoon also. If the parts such as pontoons, pipelines and other parts are excluded then the dredger will not be complete and the object for the use of the dredger cannot be achieved. From the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce to 3(a) or 3(b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration." From the plain reading of the above Rule 2(a), it can be seen that even if the goods is presented in unassembled or disassembled, if it has essential character of complete or finished item, it shall be taken to include a reference to that article complete or finished article. In the present case, three dredgers along with the parts and accessories supplied therewith and subsequent import of parts and accessories, though they are in unassembled or dis-assembled form but taking entire material together, has only essential character of the complete or finished item. Therefore, irrespective of whether the dredgers imported with some parts and remaining parts imported subsequently, it cannot be interpreted that the subsequent import of parts and accessories are different and cannot be classified along with dredgers and parts imported initially. With reference to Rule 2(a), this Tribunal has dealt with a case of Rule 2(a) of General Rules of Interpretation of the Customs Tariff Act 1975, wherein the goods were separately imported at differe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .e. 8905. The similar facts were also involved in the case of Hindustan Motors Limited - 2003 (156) ELT 155 wherein the importer imported complete diesel/ petrol engines in unassembled condition during the period February 1999 to July 2000 and cleared the same under 104 bills of entry by declaring them as parts and components of such engines. The matter was taken up in appeal before this Tribunal and this Tribunal observed that M/s. Hindustan Motors Limited had imported component sets of engines in unassembled condition which on assembly would have the essential character of the complete or finished by application of Rule 2(a) of the General Interpretative Rules. Aggrieved by this decision, M/s. Hindustan Motors filed civil appeal before the Hon'ble Apex Court and the Hon'ble Apex Court dismissed the said appeal which is reported at -2005 (181) ELT A130 (SC). In this case also the entire set of diesel/ petrol engine were imported in SKD/CKD form at different dates ranging from February 1999 to July 2000 therefore, even though the goods were imported at different time but for the purpose of classification of the goods, treated as presented together and classification was dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f any material. Complete vessels presented unassembled or disassembled, and hulls, unfinished or incomplete vessels (whether assembled or not), are classified as vessels of a particular kind, if they have the essential character of that kind of vessel, hi other cases, such goods are classified in heading 89.06. Contrary to the provisions relating to the transport equipment falling in other Chapters of Section XVII, this Chapter excludes all separately presented parts (other than hulls) and accessories of vessels or floating structures, even if they are clearly identifiable as such. Such parts and accessories are classified in the appropriate headings elsewhere in the Nomenclature, for example: From the above Chapter note in HSN, it can be seen that the goods imported by the appellant i.e. pontoons, pipes and other accessories are not excluded, therefore, the said goods being integral part of Dredger merit classification as Dredger under CTH 8905. This also clearly shows that the goods in question i.e. pipes, pontoons and other accessories are nothing but part and parcel of Dredger and are correctly classifiable as dredger under 8905. 7.1 The Revenue heavily relied on the General ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have discussed above in length about the legal interpretation of relevant provisions, but on the very identical issue, in the same set of facts, this Tribunal has decided the issue particularly for the same product i.e. Dredger, in the case of Boskalis Dredging India Pvt. Limited vs. CC, Bhubaneswar - 2001 (135) ELT 1396 (Tri. Kolkata). In this case, the facts and the order thereon, is as under:- The facts in the said case are:- "1. The appellants herein, M/s. Boskalis Dredging India Pvt. Ltd. entered into a contract with M/s. Paradip Port Trust for dredging of a Coal Handling Berth. For this purpose, the appellant firm imported an old and used Cutter Suction Dredger in operational condition together with its equipment and other functional items. The appellants filed six different bills of entry in respect of different types of items imported along with the main body of the Dredger. These items can be broadly categorized as Dredger; Pipes c/w flanges; Rings & Nuts and Bolts; Anchors; Pontoons; Delivery valves, Spuds, Cutter Heads, Truck Tyres for use as Fenders; various Spare Parts and Consumable Stores. 2. The various items in respect of which different bills of entries were fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and dumping the same at some other place. This can be done by a separate disposal system or discharge system can be a part of the Dredger by itself. Referring to the British Standard Specification (BS 6349, Part - 5 : 199), we find that there are various types of Dredgers like Stationary Suction Hopper Dredger, Trailing Suction Hopper Dredger, Cutter Suction Dredger etc. The Dredger in the instant case is a Cutter Suction Dredger in contrast to the Hopper Dredger which keeps the dredged material in its hold (hopper). When the hold is filled up, the said Hopper Dredger moves to the designated area of discharging dredged materials without the assistance of any pipelines. In such type of Hopper Dredgers, neither the Suction Pipe nor the Discharge Pipe may be essential. In the case of Cutter Suction Dredger, the procedure for carrying out the dredging work is different. The Cutter-Head is fitted with the Dredger with a Suction Pipe beneath it. The said Cutter cuts the earth, rock etc. under the water when the dredged material accumulates. As these dredged material has to be taken from the Dredger for the continuous uninterrupted dredging work, Suction Pipe sucks the dredged material. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dredge pump. The cutterhead is mounted at the extremity of a fabricated steel structure, termed the 'ladder', which also supports the suction pipe. The technical and practical requirement of disposal of the dredged material makes the Pipelines a part of the main Dredger. We find that the evidence relied upon by the appellant firm in the shape of the British Standard Specification, strongly favour their case. Accordingly, we hold that the various types of Pipelines are a part of the Dredger itself, qualifying for their classification under Chapter 8905.00 as Dredgers and therefore, they are entitled to the exemption Notification No. 133/87-Cus., dated 19-3-87. As we have held Pipelines as a part of the Dredger enjoying exemption under Notification No. 133/87, the appellants' further claim of exemption under Notification No. 106/92 dated 1-3-92, in the alternative, does not require any consideration. The appeal is thus allowed." From the above decision of the Tribunal, which was upheld by the Hon'ble Supreme Court, reported as Commissioner of Customs vs. Boskalis Dredging India Pvt. Limited - 2002 (139) ELT A313 (SC), it can be seen that the goods were absolutely identical and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ought three dredgers, two Multicats and one barge along with pontoons and pipelines. Due to constraint of place, balance pontoons and pipelines were brought subsequently on a barge "Sulayyah". In British Standard 6349: Code of practice for dredging and land reclamation: refers to Pipeline in Para 4.4.2 and Floating Pipeline in Para 4.4.2(b). The adjudicating authority observes that the appellant have declared the pontoons under CTH 89011090 as integral parts of the dredgers, that chapter heading 8901 pertains to cruise ships, excursion boats, ferry boats and that the pontoons in question are used for keeping the pipelines afloat. 11. With the above undisputed facts on record, it is clear that the pontoons imported by the appellant in the present case is in any case not classifiable under CTH 89011090, however, it is clearly classifiable as integral parts of dredgers under CTH 89051000. 12. As per our above discussion, we are of the view that all parts of Dredger has to be classified under the head Dredger i.e. 89051000, we hold that the goods of bills of entry No. 8465433 and 8465442 both dated 07.02.2017 are correctly classifiable under heading CTH 89051000 and accordingly eligi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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