AMERHSIP MANAGEMENT P LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) IN this group of Writ Petitions, the Petitioner-Companies are, inter alia, engaged in exploration/exploitation of offshore oil, gas and other related activities with the use of oil rigs on behalf of Oil and Natural Gas Corporation Limited (ONGC ). In some cases, oil rigs are owned by the Petitioner-Company and in some other cases oil rigs are brought on charter basis. In cases where oil rigs are brought on charter basis, the said oil rigs are having foreign flags flying.

(2.) THE contention in these Petitions is that on the equipments or spare parts of oil rigs which are imported by the ship at Bombay for transhipment at the place of the oil rigs, the Petitioners are not required to pay Customs duty on two counts, namely, (1) that the goods are imported at the Bombay Port only for transhipment; and (2) that the equipment are "stores" within the meaning of Section 2 (38) of the Customs Act and under Section 86 (2) of the said Act, without payment of Customs duty it can be permitted to be transferred to oil rigs or under Section 54 it can be transhipped to oil rigs without payment of Customs duty.

(3.) FOR determining whether the Petitioners are required to pay the Customs duty on the said goods, the main questions which require consideration are :