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TMI Blog2024 (4) TMI 385X X X X Extracts X X X X X X X X Extracts X X X X ..... documents like Shipping Bills, related to bunker supplies and EGM of the recipient vessels were also called for from the Customs Houses of the Ports of Supply where the supplies were shown having been made to the vessels by the Appellants. The documents like Log Book (LB) and the Oil Records Books of Bunker Barges shown having used in the transportation were also called for from the Barge owners/ Operators and details of all bunkers supplies made through barge Zee-II were called for from M/s Zee Shipping Services and others. It is found that the Shipping Bills filed at the Ports, wherein the Consignee is shown as the Master of the Foreign Going Vessels to whom the supply is to be made, were duly assessed by the proper officers of Customs at Kandla, Mundra and others ports where the Bonded tanks is located. This is evident from the fact that on Shipping Bills, bear the signatures of the Customs Officers, who assessed the Shipping Bills. Documentary evidences like acknowledgment by the Master of the vessel, acknowledgment by the Customs officers who escorted bunkers and supervised delivery to the Ships etc. produced by the Appellants clearly established that Bunkers covered under eac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eport/order on the dates appearing in the Shipping Bill(s). In such circumstance, a finding contrary to the official records of the Custom Department cannot be supporetd. It is not established that the officers had predated their signatures on the Shipping Bills. Moreover, it is on record that sale proceeds against the supply of goods were received. Penalties imposed upon other co-appellants - HELD THAT:- It is found that the evidences on record clearly point out that M/s AEL and M/s World Link supplied the goods to foreign going vessels and there is no diversion of the disputed goods elsewhere as alleged by the department. In such circumstances we do not find any merit in the impugned orders imposing the penalties on the co-appellants. The impugned orders are liable to be set aside and accordingly the impugned orders are set aside - Appeal allowed. - CUSTOMS APPEAL NO. 10375 OF 2013-DB CUSTOMS APPEAL NO. 10393 OF 2013 CUSTOMS APPEAL NO. 10430 OF 2013 CUSTOMS APPEAL NO. 10431 OF 2013 CUSTOMS APPEAL NO. 10432 OF 2013 CUSTOMS APPEAL NO. 10468 OF 2013 CUSTOMS APPEAL NO. 10143 OF 2016 CUSTOMS APPEAL NO. 10144 OF 2016 CUSTOMS APPEAL NO. 10145 OF 2016 CUSTOMS APPEAL NO. 10351 OF 2016 H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [u/s 114AA of the Customs Act, 1962] 8 C/10143/ 2016 Blue Ocean Sea Transport Ltd. KDL/COMMR/PVRR/12/2015-16 dated 30.09.2015 1. Rs. 12,50,000/- [u/s 112(b) of the Customs Act, 1962] 2. Rs.12,50,000/- [u/s 114(ii) of the Customs Act, 1962] 9 C/10144/ 2016 Dushyant Patel KDL/COMMR/PVRR/12/2015-16 dated 30.09.2015 1. Rs. 5,00,000/- [u/s 112(a) of the Customs Act, 1962] 2. Rs.5,00,000/- [u/s 114(ii) of the Customs Act, 1962] 3. Rs. 10,00,000/- [u/s 114AA of the Customs Act, 1962] 10 C/10351/ 2015 Zee Shipping Services KDL/COMMR/PVRR/12/2015-16 dated 30.09.2015 1. Rs. 12,50,000/- [u/s 112(b) of the Customs Act, 1962] 2. Rs.12,50,000/- [u/s 114(ii) of the Customs Act, 1962] 2. Briefly, the facts of the present case are that M/s Adani Enterprise Ltd. (M/s AEL) and M/s World Link TC Bond Store (M/s World Link) were engaged in the activities of import of High Speed Diesel, Furnace Oil etc. M/s AEL and M/s World Link were importing the HSD, Furnace Oil and getting the same Warehoused in terms of Section 58 and Section 85 of the Customs Act, 1962 for re-export thereof including for supply to the foreign going vessels in respect of which they used to file undertaking in terms of Section 59 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we also noticed that, Appellants approached the Tribunal and vide order No. A/11395-11397/2013 dated 24.10.2023 the matter was remanded by the Tribunal to the adjudicating authority. Subsequent to the remand, the Ld. Adjudicating authority in denovo adjudication vide impugned order again confirmed custom duty demand and imposed penalties on the Appellants. Hence the all the appellants are once again before the Tribunal. 4. Shri Shri Vikas Mehta, learned Consultant appeared for the appellant M/s World Link and submits that export of goods covered by the shipping bills were duly certified by the Customs Officers at the port of export. Further during the investigation, statements of all officers of Customs at port of exports were recorded by DRI and none of them have stated that they had erroneously certified the delivery (export) of the goods to the Master of the vessels named in the Shipping Bills. Hence, demand is not sustainable. He placed reliance on following judgments: (i) Marvel Apparels Vs. Commissioner of Customs, Trichy -2008(227)ELT 243 (Tri. Chennai) (ii) Reliance Industries Ltd. Vs. Commissioner of Central Excise, Bombay 2006(199) ELT 681 (Tri. Del.) 5. He also submits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecuted by the appellant under Section 59 of the Customs Act, 1962 at the time of import i.e at the time of warehousing the goods and the transit bonds executed by the appellant at the time of export i.e filing of Shipping Bills have also been cancelled by the competent authority on the basis of documentary evidences submitted by the appellant at the material time. The impugned order does not cite any positive evidence in the form of statement or document to prove that the goods under consideration were diverted to any other place/ person/ vessel instead of being supplied the vessel declared in the Shipping bills filed by the appellant. In absence of this, the demand of import duty on the said goods on the ground that the same were not supplied to the foreign going vessels, is not sustainable. Further, no verification has been caused with the owners of the vessels who had ultimately borne the expenses of bunkers supplied to their vessels. 11. He further submits that Appellant was permitted to import HSD under Customs bond without an import licence. At the material time, the appellant had declared that HSD was to be supplied as stores to vessels without payment of import duty. In kee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... established by the shipping bills assessed by the customs officers at Kandla and Mundra, the endorsements on the reverse of shipping bills, issuance of landing certificates and discharge of transit bonds. Accordingly, the shipping bills duly assessed by customs officers at Kandla and Mundra, the endorsement allowed for shipment on the reverse of the shipping bills by the Customs officer at the ports where the foreign going vessels are stationed, endorsement of received on board the vessel by the customs inspector and master of the vessel, Landing certificate signed by the customs inspector and master of the vessel and discharge and cancellation of the Transit Bonds duly establish that the Bunkers after clearance from Bonded Tanks have been taken on board the foreign going vessels in accordance with Section 88 read with Section 69 of the Customs Act 1962 and are therefore no duty is payable. 14. He argued that the impugned show cause notice proposed to demand duty on the Bunkers supplied to the Foreign Going Vessels on the ground that there was no Let Export Order under Section 51 of the Customs Act 1962 in respect of the said Bunkers. However the said contention is totally misconce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity ends once the Bunkers are received on board the foreign going vessel and the Appellant is in no way responsible if thereafter the Master of the vessel does not mention the same in the EGM filed for the vessel. The department has not recorded a single statement of any master of the vessel and not sought the master s explanation for not mentioning the bunker in the EGM of the vessel despite the master having endorsed receipt of the bunker on the vessel on the reverse of the shipping bill and in the Landing Certificate. 16. He further argued that the contention in the show cause notice which is relied upon by the Commissioner that the Master of the Barge which carried the Bunkers has stated that there were mistake in the Oil record book of the Barge, this cannot be a ground for holding against the Appellant that the Bunkers were not supplied to the foreign going vessels and were diverted. Once the receipts of the Bunkers on board the foreign going vessels is confirmed and endorsed on the shipping bills and certified by the landing certificate duly signed by the Customs Officers and the Master of the Vessel, any alleged discrepancy/ mistake in the Oil record books maintained by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment is that M/s AEL and M/s World Link in connivance with M/s Zee Shipping Services, M/s Blue Ocean Sea Transport Ltd, Jaisu Shipping Company Pvt. Ltd. and Messrs Link Enterprise, imported duty free Furnace Oil HSD Fuel Oil under warehouse procedure and same was illegally supplied under the guise of Export to Stores on Foreign Going Vessel . The case of the revenue is that although the goods were taken out of charge Ex-Bond successfully yet the same was not supplied to any Foreign Going Vessel and diverted elsewhere. 20. Before going to decide the present matter it is important to discuss the procedure to be followed for duty free import of bunker, its warehousing and subsequent supply on ship store. We find that for the purpose of causing import and subsequent warehousing of Furnace Oil and HSD, importers are filing warehousing bond/undertaking in terms of Section 59 of the Customs Act, 1962 subscribing the declaration that the imported bunker fuel would be exported in the form of supply to vessels under foreign run. Hence on execution of the Warehousing Bond by the importers, such Furnace Oil and HSD are allowed to be warehoused in terms of Section 85 of the Customs Act, 1962 w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pply of bonded bunker to any foreign going vessels are legally and statutorily mandatory as provided by the relevant Sections of the Customs Act, 1962. 21. In the present disputed matter department alleged that the Bunkers so cleared by the Appellants during the impugned period under cover of various shipping bills were diverted and illegally supplied in contravention of the provisions of the Customs Act. 1962. We find that revenue during the investigation Bunker Supply documents consisting of the photocopies of Shipping Bills, Short Shipment Notices, Sale contract and Warehousing Bonds/ undertaking etc. were called and recovered from the Appellants. Besides the documents like Shipping Bills, related to bunker supplies and EGM of the recipient vessels were also called for from the Customs Houses of the Ports of Supply where the supplies were shown having been made to the vessels by the Appellants. The documents like Log Book (LB) and the Oil Records Books of Bunker Barges shown having used in the transportation were also called for from the Barge owners/ Operators and details of all bunkers supplies made through barge Zee-II were called for from M/s Zee Shipping Services and others ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entire investigation no persons of the appellant admitted that the disputed goods were not supplied to the foreign going vessels, further department nowhere recovered any documents from the business premises of the appellants by which it can be established that the Appellants have diverted the goods. Not a single customer is brought on records who received the diverted goods. No documentary evidence is produced in the form of transport receipts, delivery challans or any other documents relating to alleged clandestine removal of disputed goods. No evidence was produced regarding the receipts of payment against the alleged diverted goods. No transporter or any person are brought on records who has transported the disputed goods elsewhere. Admittedly, no such evidence has been produced by Revenue. However, the case of diversion of Bunkers in the present matter is confirmed by the Ld. Adjudicating authorities without any such evidences which are legally not correct in the eyes of the law. 24. We find that in the present matter the demand is confirmed by the Ld. Adjudicating authorities in respect of the Shipping Bills on the ground that the EGM s filed by the vessels do not reflect the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Moreover, it is on record that sale proceeds against the supply of goods were received. Under these circumstances the finding of the Ld. Adjudicating authorities that the impugned goods had not been supplied to Foreign going vessels and diverted elsewhere cannot be sustained. The entire case was based on the error and mistake in some documents but no physical movement or diversion could be established by the department. In this fact, the demand of customs duty is not sustainable. 25. Since we have decided the matter on merit, we are not going into other grounds raised by the Appellants. 26. As regards penalties imposed upon other co-appellants, we find that the evidences on record clearly point out that M/s AEL and M/s World Link supplied the goods to foreign going vessels and there is no diversion of the disputed goods elsewhere as alleged by the department. In such circumstances we do not find any merit in the impugned orders imposing the penalties on the co-appellants. 27. As per the our above discussion and findings, we are of the considered view that the impugned orders are liable to be set aside and accordingly the impugned orders are set aside. Appeals filed by the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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