NDLI: Chowgule & Co. Private Limited Etc. Vs. Union of India & Ors.

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	Customs Act Goods for home consumption
Content Type	Text
Resource Type	Law Judgement
Jurisdiction	India
Act(s) Referred	Customs Act, 1962 (52 of 1962)
Case Type	Appeal
Court	Supreme Court of India
Disposal Nature	Appeal Dismissed
Headnote	Customs Act, 1962--Sections 12, 15 ( c) and 46--'Vessel' whether 'goods'-'Goods for home consumption'-Determination of for purposes of levy of customs duty-'Vessels' brought to India for topping up operations in Mormugao harbour-Whether ocean going vessels- Necessary to present Bill of Entry 'Vessel'-'Goods for home consumption'-Meaning of. The appellants in Civil Appeal No. 179 of 1985 carry on business of exporting iron ore to various countries. Previously iron ore used to be brought to the harbour from various mines by barges and unloaded in the harbour. Thereafter, the iron ore could be loaded on board ocean going ore carriers. Alternately, they could directly unloaded in stream into the ocean going ore carriers. Shallow draught of the harbour prevented large ocean going ore carrying vessels from entering the harbour or from having iron ore loaded to full capacity on such vessels within the harbour and considerable time was wasted in the loading process resulting in substantial increase of the transporting cost. The appellant Company, therefore, conceived the idea of acquiring a "Transhipper" into which barges could unload iron are and from which large quantities thereof could be loaded into large vessels in open anchorages, a process .... described as "topping up". The appellant Company after obtaining necessary permission from the Government of India for purchasing a second hand vessel for use as a topping up vessel at Mormugao harbour for iron ore exports, acquired a second hand tanker, had it converted as a transhipper and obtained "A certificale of Condition." On the arrival of the vessel in the harbour the Deputy Conservator of the harbour was informed that "this is an old 72 Tanker converted and equipped to do the work of topping up of the bulk carriers after they are loaded at the G mechanic plant to the permissible draught." The appellant Company then applied to the Government of India for the issue of "General ~ Licence" under s.406 of the Merchant Shipping Act, 1958 stating that the general licence was sought to ply the vessel 'for topping purposes in stream at Mormugao harbour'. Licence was granted by the Government H of India "(a) for topping up purposes in stream at any Indian port; (b) for trading on coast; and (c) for a period of 5 years from March 5, 1970 to A March 4, 1975". The appellant Company also informed the Assistant Collector of Customs about the acquisition of the vessel 'Maratha Transhipper' for "the purpose of uptopping large size bulk carrier in stream" stating that they would be operating the ship within the port limits, that she would serve as a sea barge, that normally she would take cargo coming by barges with the help of her own equipment and storing in her own hatches and thereafter she would go along side bulk carriers and transfer the ore from her bolds into the bulk carriers. Subsequently, it was also informed that transhipper was registered as a "home trade vessel" and it was capable of three types of operations namely, (a) load herself in stream in river barges; (b) up-top another vessel by using the cargo from her own batches; and (c) up-top another vessel by using the cargo from barges which go along side Maratha Transhipper. Thus, "the Maratha Transhipper" possessed all the certificates prescribed by the Merchant Shipping Act and other Maritime Laws to enable her to ply the oceans. The Assistant Collector of Customs asked the appellant Company to file a Bill of Entry for stores on board the vessel and for clearance of the vessel for home consumption. On query being made by the appellant Company as to under what provisions of the law they were required to file the Bill of Entry, the Assistant Collector replied stating: "the function of the vessel 'S.S. Maratha Transhipper' is in the nature of sea barge operating within the port limits. Such operations are reserved to the vessels imported for home consumption." The Assistant Collector of Customs issued a notice to the appellant Company to show cause why the Bill of Entry was not tiled. After the reply to the notice was sent and a personal hearing was granted to the Company, the Assistant Collector made an order requiring the company to file a Bill of Entry for home consumption. This order was confirmed by the Appellate Collector. The orders of the Assistant Collector and the Appellate Collector were questioned in a writ petition. A Single Judge allowed the petition but on appeal a Division Bench set aside the order of the Single Judge and dismissed the petition holding that a vessel was 'goods' within the meaning of s.46 of the Customs Act. The vessel in C.A. No. 4427 of 1985 was an ocean going merchant vessel engaged in foreign and coastal trade in India and various foreign countries. The appellant acquired the vessel from the previous owner and obtained the permission of the Government to have it converted as a Transhipper. After the vessel arrived at Mormugao Port, the Customs Authorities demanded that a Bill of Entry should be filed. Thereafter the same story followed as in the other case. In the appeal to this Court on behalf of the appellant it was contended: (1) that the scheme of the Customs Act show that a vessel was not 'goods' within the meaning of s.46(1) of the Act and therefore, it was not necessary to me a Bill of Entry; (2) that it was also the case of the Government of India that an ocean going vessel was not required to file a Bill of Entry and that the vessels in question were ocean going vessels notwithstanding that their main purpose was topping up bulk carriers; (3) that the Division Bench was wrong in refusing to go into the question whether or not the vessels were ocean going vessels when that was the very basis of the orders of the Customs Authorities as well as the judgment of the Single Judge, and (4) that notwithstanding the definition, the scheme of Chapters VI and VII of the Customs Act and the context in which the expression 'goods' is used in s.46 of the Act require the expression to be interpreted for the purpose of s.46(1) as excluding the vessel, aircrafts or vehicles.On behalf of the respondent Union, it was contended that the definition of the word 'goods' in the Customs Act unambiguously included a vessel, and that in any case the vessels in question in both the cases were Transhippers used for topping up operations in Indian territorial waters and could not claim to be classified as ocean going vessels.
Judge	Hon'ble Mr. Justice O. Chinnappa Reddy
Neutral Citation	1987 INSC 53
Petitioner	Chowgule & Co. Private Limited Etc.
Respondent	Union Of India & Ors.
SCR	[1987] 2 S.C.R. 351
Judgement Date	1987-02-19
Case Number	179

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