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2022 Supreme(Online)(Ker) 63570
KERALA HIGH COURT
N. Kumar, J
Commissioner of Customs – Appellant
Versus
M/s. Asean Cableship Pvt. Ltd, Singapore – Respondent
Customs Appeal No.27102/2013
For the Appellants/Petitioners: Mr N Venkataraman
For the Respondents: Mr Rohan Shah
The determination of a vessel's status as a foreign-going vessel under Section 2(21) of the Customs Act permits exemption from customs duty under Section 87, thus establishing the appeal's maintainability under Section 130.
Headnote:(A) Customs Act, 1962 - Sections 87 and 130 - Appeal against CESTAT order - Maintainability of appeal determined on whether C S Asean Explorer is a foreign-going vessel - The CESTAT allowed the respondent's claim that the vessel was exempt from duty under Section 87 - The main question is whether the vessel's status qualifies it for exemption under the Act. (Paras 4, 7, 9.1, 9.2)
(B) Jurisdiction - The distinction between eligible and ineligible orders for appeal under Section 130 is pivotal - The court clarified that if the issue is the status of the vessel concerning duty, it falls within its jurisdiction. (Paras 6.2, 9.2)
Facts of the case:
An appeal was filed regarding the confiscation order of the C S Asean Explorer, with claims about its status as a foreign-going vessel amid penalties and duty demands issued by the Commissioner of Customs.
Findings of Court:
The court held that the issues surrounding the vessel's classification and resultant duty obligations were justiciable, confirming the appeal's maintainability under Section 130.
Issues: The court examined whether the appeal under Section 130 was permissible based on the classification of the vessel as foreign-going.
Ratio Decidendi: The court reasoned that the primary consideration is the vessel's status, leading to the conclusion that if its classification is valid, the duty demand is not applicable.
Result: Objection on maintainability of the appeal was overruled.
| Table of Content |
|---|
| 1. establishment of facts and agreements (Para 1 , 2 , 3) |
| 2. arguments on maintainability of the appeal (Para 4 , 5) |
| 3. court's analysis on jurisdiction (Para 6 , 7) |
| 4. definitions and their applicability (Para 8) |
| 5. final observations on appeal jurisdiction (Para 9) |
1. Heard Mr N Venkataraman, learned Additional Solicitor General for the appellant, and Mr Rohan Shah, learned Counsel for the respondent, on the maintainability of theinstant appeal before this Court under S.130 of the Customs Act, 1962 (for short 'the Act').
2. The Commissioner of Customs, challenging the Final Order No.20218-20219/2020 dated 18.02.2020 in Customs Appeal No.27102/2013 of Customs, Excise and Services Tax Appellate Tribunal (CESTAT), Bangalore, has filed the appeal under S.130 of the Act. M/s. Asean Cableship Pvt. Ltd, Singapore, represented by its General Manager, is the respondent. For convenience, parties are referred to as appellant and respondent.
3. The Background Circumstances: On 15.12.2005 the agreement entitled 'The South East Asia and Indian Ocean Cable Maintenance Agreement' was entered between the Telecom Companies (Maintenance Authorities) and Cableship operators. The object of the agreement is to provide submarine cable installation, repairs and maintenance to the Maintenance Authorities. The respondent, in turn, entered into an agreement with Cochin Port Trust for availing berthing facility at Cochin Port. The respondent, as part of its contractual obligation under 'South East Asia and Indian Ocean Cable Maintenance Agreement', shall be based at Port of Cochin, India, and has deployed 'C S Asean Explorer' for carrying out the contractual obligations under the Cable Maintenance Agreement. 'C S Asean Explorer' was berthed at Cochin Port and undertook sorties to places of repair and maintenance work in the Arabian Sea.
3.1 Show - cause notice dated 10.07.2012 along with corrigendum dated 14.08.2012 was issued proposing to initiate action under S.111(b) and (f) of the Act read with S.125 of the Act contemplating to levy duty, impose redemption penalty, etc under S.128(8) and (10) of the Act. The respondent resisted these steps initiated for alleged violation of any of the provisions of the Act by the appellant. For our present purpose it is sufficient to notice that the respondent claimed that C S Asean Explorer, which was subjected to a confiscation order, is a foreign - going vessel falling within the definition of S.2(21), and S.87 of the Act accords exception from payment of any duty under the Act, C S Asean Explorer since is a foreign - going vessel. In other words, S.87 of the Act exempts payment of duty on the stores consumed by C S Asean Explorer during the period 2007-2012. Therefore, the respondent is not answerable to any duty leviable under the Act, no assessment is required for the purpose of determining the amount payable by the respondent, and consequently, levy of penalty, redemption fine, duty etc are not warranted in the peculiar circumstances of the case.
3.2 In the present order, we are, as noted above, considering whether the instant appeal is maintainable against the order dated 18.02.2020 of the CESTAT in this Court under S.130 of the Act or not? Therefore, by a clear choice and understanding, we are refraining from detailing several niceties or intricacies relied on by both the parties in support of their respective contentions on the real issues arising for a decision of the Court. The Commissioner of Customs, through order dated 04.04.2013, imposed and demanded the following sums from the respondent:
"i) I order confiscation of the vessel C.S.ASEAN Explorer, valued at Rs. 80.60 crores under S.111 (d) and 111 (f) of the Customs Act, 1962 .
ii) I allow redemption of the vessel C.S.ASEAN Explorer, valued at Rs. 80.60 crores on payment of a redemption fine of Rs. 8,00,00,000/- (Rupees Eight Crores only) under S.125 of the .
iii) I hold the stores, spares and bunkers consumed by the vessel during its stay in
