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TMI Blog2008 (4) TMI 173X X X X Extracts X X X X X X X X Extracts X X X X ..... urali, Advocate, for the Appellant. Shri M.K.A.K. Mohideen, JDR, for the Respondent. [Order per: P.C. Chacko, Member (J)]. - The appellant had purchased two fishing trawlers of foreign origin from M/s. Kerala State Cooperative Federation for Fisheries Development Ltd. [popularly called Matsyafed], an undertaking of the Govt. of Kerala, on 26-2-1998. Long before that, Matsyafed had imported these deep sea trawlers and cleared the same without payment of Customs duty by claiming the benefit of exemption under Customs Notification No. 262/58, dated 11-10-1958. This Notification was superseded by Customs Notification No. 133/87, dated 19-3-1987 which also granted exemption for such vessels. One condition under these Notifications was t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the trawlers under Section 111(o) with option to redeem the same on payment of a fine of Rs. 1.00 lakh. He also imposed a penalty of Rs. 20,000/- on Shri P.A. Sadiq (Proprietor of the appellant-concern) under Section 112. Besides these, duties as applicable were also directed to be paid by the party as the owner of the vessels. The Commissioner exonerated other noticees [owner of the boatyard from where the vessels were seized, and M/s. Matsyafed, the original importer] from penal liability. The present appeal is directed against the Commissioner's decision. 2. It also needs mention that, after the first order of adjudication was passed, the party had made payment of Ks. 10,000/- towards fine, Rs. 1,00,000/- towards penalty and Rs. 4, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ler was inclusive of all taxes, duties and other charges. The case of the appellant is that, as bona fide purchaser, he is not liable to pay any duty, fine or penalty in relation to the vessels. Counsel has also raised a valuation dispute in relation to the demand of duty. 4. It appears from the records that numerous letters were exchanged between the appellant and M/s. Matsyafed and also between the appellant and the department, one of which is a letter dated 12-12-1998 addressed to the Commissioner of Customs, Cochin, wherein the appellant had requested the Commissioner to allow him to redeem the vessels on payment of a fine of Rs. 1.00 lakh and also a penalty. In that letter, the appellant requested the Commissioner for release of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... res) as are imported for the purpose of breaking up; and (b) any such goods (that is to say vessels and other floating structures), if subsequently are intended to be broken, the importer shall present fresh Bill of Entry to the Collector of Customs, and thereupon such goods shall be chargeable with the duty which would be payable on such goods as if such goods were entered for home consumption under Sec. 46 of the Customs Act 1962, (52 to 1962), on the date of the presentation of such fresh Bill of Entry to the Collector of Customs for the purpose of break-up of such goods". (emphasis added) We note that the descriptive text of the condition given in Notification No. 133/87-Cus. is an amplified version of the condition stated in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll of Entry for the purpose of breaking up. Thus, in relation to the period between the original importation of the subject vessels and their clearance under fresh Bill of Entry for the purpose of breaking, Matsyafed as original importer and the appellant as subsequent owner of the vessels get covered by the definition of "importer" under Section 2(26) of the Act for the respective segments of the said period. In his capacity as 'importer', so defined, the appellant upon having acquired the vessels from Matsyafed came to be burdened with the liability to file fresh Bill of Entry to the Commissioner of Customs and to observe all the attendant formalities under the Customs Act. Therefore, in our considered view, the appellant cannot resist be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Contextually, we may also point out that, where Section 159A of the Customs Act is available, Section 6 of the General Clauses Act (referred to by the counsel) need not be pressed into service. 7. The Commissioner's order of confiscation of the vessels under Section 111 is justifiable for the reasons already recorded. It goes without saying that, by committing breach of the condition attached to the Notification, the appellant rendered the goods liable to confiscation, thereby attracting penal liability under Section 112 of the Act. However, the quanta of fine and penalty imposed by the Commissioner are not reasonable in the facts and circumstances of this case. Learned Commissioner imposed a fine of Rs. 1.00 lakh in l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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