JUDGMENT

D.K. Jain, J. —

1. This appeal, under Section 130E of the Customs Act, 1962 (for short “the Act”), is directed against order dated 18th February, 2003, passed by the Customs, Excise & Gold (Control) Appellate Tribunal, as it existed at the relevant time, (for short “the Tribunal”). By the impugned order the Tribunal has dismissed the appeal filed by the appellant herein and confirmed the levy of customs duty on the ocean going vessel, registered as M.V. Jagat Priya, purchased by them in a Court auction, for breaking/ scrapping purpose in terms of Notification No. 133/87-Cus.

2. M.V. Jagat Priya was manufactured by M/s. Hindustan Shipyard Ltd. in the year 1975 in a Customs Bonded Warehouse at Vishakapatanam, using certain imported items. The said vessel was cleared on 30th November, 1975, and was delivered to M/s. Dempo Steamship Ltd. for a consideration of ‘7,61,12,400/- and Central Excise duty at the rate of 1% was paid thereon. The vessel was registered as Indian vessel tonnage and flying an Indian flag. However, it ceased to ply and was grounded at Bedi Bunder, Jamnagar, in June 1986. On 16th October, 1992, an order was passed by the High Court of Judicature at Bombay in Admiralty suit at the instance of Union of India and the Shipping Credit and Investment Co. of India Ltd. for auction of the vessel on “as is where is” basis “free from all encumbrances and existing liens”.

3. On 12th February, 1993, the vessel was auctioned and being the highest bidder, the appellant viz. M/s. Mustan Taherbhai purchased the vessel. The sale in favour of the appellant was confirmed by the High Court and in furtherance thereof, the possession of the ship was delivered on 4th March, 1993. Thereafter, on 10th May, 1993, on the direction of the Superintendent of Central Excise & Customs, the appellant filed a bill of entry claiming that the ship was an Indian built ship, and therefore, no customs duty was payable. On 12th May, 1993, the Superintendent of Central Excise, Jamnagar passed a provisional assessment order demanding customs duty @ 5%, and an additional duty of ‘1000/- per LDT.

4. Being aggrieved, the appellant preferred Special Civil Application No. 4924 of 1993 before the High Court of Gujarat. The High Court, vide interim order dated 25th May, 1993, permitted the appellant to clear the materials obtained by breaking the ship in question without payment of provisional duty on the condition that the appellant will file a bond with security deposit. Vide order dated 23rd July, 1993, the High Court disposed of the said application, and directed the appellant to file an appeal before the Commissioner (Appeals). Accordingly, the appellant preferred an appeal before the Commissioner (Appeals).

5. The Commissioner (Appeals), vide order dated 29th April, 1994, dismissed the appeal and confirmed the order of provisional assessment dated 12th May, 1993.

6. Being aggrieved, the appellant preferred an appeal before the Tribunal. Vide order dated 10th July, 1998 the Tribunal dismissed the appeal. Relying on the decision of this Court in Union of India & Ors. Vs. M/s. Jalyan Udyog & Anr.1 (1994) 1 SCC 318, the Tribunal observed that Notification No. 133/87-Cus was applicable in the instant case, and therefore, the appellant was liable to pay customs duty on the vessel at the rate prevalent at the time of breaking of ship.

7. Being dissatisfied, the appellant preferred an application under Section 129(B)(2) of the Act praying for rectification of mistakes in the order, dated 10th July, 1998, on the ground that the Tribunal had erroneously concluded that: (i) the goods manufactured in a customs bonded warehouse were similar to goods imported under the Act; (ii) the issue for determination before it was whether Notification No. 133/87-Cus was applicable or not, whereas the real issue for determination was whether the vessel was imported or indigenously manufactured; (iii) the customs duty under Notification No. 133/87-Cus was payable when