ISPAT TRADERS Vs. COMMISSIONER OF CUSTOMS, JAMNAGAR

JUDGEMENT

(1.) THE facts giving raise to this appeal are as follows : The appellant imported a ship for dismantling through canalyzing agency M/s. MSTC Ltd. in March 1987. As per a MOA dated 17 -1 -87 between the seller and M/s. MSTC, the LDT of the vessel was 5679.58. However the appellant had shown 5179.88 as LDT in the bill of entry. The bill of entry was initially assessed provisionally subject to resolving the dispute over LDT subject to production of MOA between the seller and MSTC. The provisional assessment was later finalized on 4 -5 -88 by taking 5679.58 as LDT resulting in differential duty demand of Rs. 7,11,237.80 against the appellant. Out of this amount an amount of Rs. 4,71,446/ - was adjusted out of refunds eligible to the appellants in some other case on 21 -2 -89. The matter relating to the assessment of the ship reached the Tribunal and the New Delhi Bench of the Tribunal vide stay order dated 13 -3 -89 ordered that the appellant should pay the balance amount of duty also as a condition of hearing the appeal. This was challenged by the appellants before the Honble High Court of Mumbai who converted the requirement of deposit of cash to a bank guarantee which was furnished by the appellants. Since the problem had arisen because MSTC had not issued appropriate addendum revising the LDT of the vessel as 5179.58, the appellant filed SCA No. 498/1990 before the Honble High Court of Gujarat against M/s. MSTC to which customs was also made a party.

(2.) WHILE this appeal was pending the appeal filed by the appellants against the finalization of assessment was disposed of by the Tribunal vide order No. 1559/96 -A dated 20 -5 -96. The Tribunal in the order remanded the matter to original adjudicating authority with the following observations : The appellant has told us that the MSTC Ltd. was approached with the complaint of the ship having a deficit of 500 L.T. as LDT and that at the instance of the latter, the appellant gave up the claim for refund of a proportionate sale price in writing, hoping for an addendum showing the correct LDT since M/s. MSTC Ltd. did not give such an addendum, the appellant has filed writ petition before the High Court of Gujarat at Ahmedabad seeking to compel M/s. MSTC Ltd. to issue an appropriate addendum to the original declaration showing LDT of vessel as 5179.58 L.T. and to give further allotment of 500 LDT to the appellant. We are told that the writ petition is still pending. In the above circumstances, we feel that the interests of justice require that the matter is reconsidered by the statutory authority. It would be advisable for the authority concerned to await the decision of the High Court in the writ petition. If the High Court decides the controversy regarding LDT then there should be no difficulty for the Customs Authorities to follow the same. If on the other hand, the writ petition is disposed of without deciding the LDT controversy, the Customs Authorities shall consider the contentions of the appellant in accordance with the law and in the light of the observations in this order and pass a final order. We accordingly set aside the impugned orders and allow the appeals as indicated above.

(3.) ON 9 -7 -96, appellant filed a letter requesting the Assistant Commissioner to refund the amount of Rs. 4,71,447/ - adjusted against the demand as the impugned orders were set aside by the Tribunal on 20 -5 -96. The appellant reiterated their request for refund vide letter dated 7 -12 -04 and release of bank guarantee which was again rejected by the original adjudicating authority on 26 -6 -06. This matter also reached the Tribunal and this Tribunal vide Oder No. A/271/WZB/AHD/08 dated 20 -2 -08 remanded the issue of refund claim also to the original adjudicating authority with a direction to decide both the issues namely issue of assessment of the ship as well as the refund of the amount deposited by the appellants. Later the Honble High Court of Gujarat vide order No. 25 -11 -08 decided the writ petition and directed MSTC to give its conclusion within four months. Accordingly MSTC Mumbai vide letter dated 16 -4 -09 intimated that LDT of the vessel was 5179 LDT only. On the basis of this letter and after considering the bill of entry, the original adjudicating authority vide his order dated 30 -6 -09 dropped the demand for differential duty of Rs. 7,11,237/ -. In the same order he also directed the release of the bank guarantee and ordered the appellant to file a refund claim under Section 27 of the Customs Act, 1962 (the Act for short) for the excess amount of duty of Rs. 4,71,447/ - recovered earlier. On an appeal filed by the appellant, the appeal was rejected and hence the appellant is before this Tribunal once again with the following prayers :