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TMI Blog2006 (8) TMI 179X X X X Extracts X X X X X X X X Extracts X X X X ..... to be beyond the period of limitation. Accordingly, the demand of duty and levy of penalty for the subsequent period is quashed. Penalty, if any, for the period of six months immediately preceding the issuance of notice, for which the assessee has agreed to pay the duty, is also waived. - 3584-3588 of 2001 - - - Dated:- 7-8-2006 - Ashok Bhan and Markandey Katju, JJ. [Judgment per : Ashok Bhan, J.]. - These appeals have been filed by Aban Loyd Chiles Offshore Limited, Essar Oil Limited and Amarship Management Ltd. against the common order dated 15-1-2001 passed by the Customs Excise Gold (Control) Appellate Tribunal, West Regional Branch at Mumbai (for short "the Tribunal") by which the Tribunal has allowed the appeals of the appellants in part. The appeals are directed against the part of the order which has gone against the appellants. Revenue has not come up in appeal against the part of the order which has gone against it. FACTS 2.In the year 1970, Oil and Natural Gas Corporation ONGC commenced offshore operations of exploration and exploitation of oil and natural gas etc. ONGC entered into contracts with various companies, which were contractors acting for and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iderable movement of goods between the shore and the rigs. The extensive machinery in the rigs often requires repair and replacement. It was the practice in the custom house to treat the replacement of parts or machinery on the rigs as ship/stores and not to levy duty on them in terms of the provisions of the Act. Items which required repair or replacement were to be disposed from the rigs are also brought back from the rigs on to the main land. Such activities were carried out by a procedure centralised through the ONGC. ONGC was conducting such operations from shed No. 12 Victoria Docks.. The goods which were repaired and required to be fitted as ship stores were cleared from customs without payment of duty on transshipment permits and generally escorted by an officer of the Customs to 12 Victoria Docks. From there the goods used to be sent by supply boats under the operation of the ONGC to the rigs in question. Similarly, these supply boats used to bring from the rigs unserviceable material or machinery requiring repair or replacement into the Victoria Docks according to law. For example, scrap which was to be disposed of on payment of duty, a machinery part requiring replacemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, neither the demand for duty nor the levy of penalty was justified. Similarly, it was contended that the goods could not be confiscated as the Department was all through aware that Nhava Base was being used for loading and unloading of goods for being taken to the rigs and were being received from the rigs to the main land. It was also pointed out that in the present case the show cause notices did not contain an averment pointing out specifically as to which of the various omissions or commissions had been committed by the appellants to invoke the extended period of limitation thus depriving the appellants to meet the case of the Department. It was further contended that the show cause notice did not contain the averment that the duty had escaped or short levied or not charged because of any willful mis-statement or suppression of facts on the part of the appellants. 10.Appellants were given personal hearing and they filed their written submissions as well. 11.The Commissioner of Customs by his order dated 29-9-1997 confirmed the demand as per show cause notices and rejected the contention raised on behalf of the appellants. Demand of duty of Rs. 10,16,35,914/- and a pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken steps to regulate." 15.The remaining three appeals directed against the order dated 29-9-1997 were dismissed. The orders of Commissioner of Customs were confirmed. 16.Mr. Joseph Vellapally, learned Senior counsel appearing of the appellants submitted at the outset that the appellants are prepared to pay the duty for the last six months immediately prior to the issuance of the show cause notice, treating the show cause notice to be valid to that extent but challenge the invocation of the proviso to Section 28 of the Act to extend the period of limitation. In view of this submission, we are disposing of these appeals only on the point as to whether the Department could invoke the extended period of limitation under proviso to Section 28 of the Act. 17.Mr. Joseph Vellapally, learned Senior counsel appearing for the appellants, contends that the Tribunal erred in holding that the extended period of limitation of five years as provided under the proviso to Section 28 of the Act could be invoked in the facts and circumstances of the case. That the Customs Department at all relevant time was in full and complete knowledge of all the activities being carried out by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty has not been levied or has been short-levied or erroneously refunded, or when any interest payable has not been paid, part paid or erroneously refunded, the proper officer may, - (a) in the case of any import made by any individual for his personal use or by Government or by any educational research or charitable institution or hospital, within one year; (b) in any other case, within six months, from the relevant date, serve notice on the person chargeable with the duty or interest which has not been levied or charged or which has been so short-levied or part paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice : Provided that where any duty has not been levied or has been short-levied or the interest has not been charged or has been part paid or the duty or interest has been erroneously refunded by reason of collusion or any willful mis-statement or suppression of facts by the importer or the exporter or the agent or employee of the importer or exporter, the provisions of this sub-section shall have effect as if for the words "one year" and "six months", the words "five ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 11A(1), the show-cause notice must put the assessee to notice which of the various commissions or omissions stated in the proviso is committed to extend the period from six months to 5 years. Unless the assessee is put to notice, the assessee would have no opportunity to meet the case of the department. The defaults enumerated in the proviso to the said sub-section are more than one and if the Excise Department places reliance on the proviso it must be specifically stated in the show-cause notice which is the allegation against the assessee falling within the four corners of the said proviso...." 23.In the present case we find that in the show cause notice it is not alleged that duty of custom could not been levied or paid by reason of collusion or willful mis-statement or willful suppression of facts. The appellants were not put to notice which of the various omissions or commissions stated in the proviso were committed by them to extend the period of limitation from six months to five years. The appellants having not been put to notice did not have the opportunity to meet the case of the Department. 24.Tribunal in its order while accepting the appeals filed by Aban Lo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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