2024-VIL-429-CESTAT-AHM-CU
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CUSTOMS CESTAT Cases

Customs – Sections 59 and 85 of Customs Act, 1962 – Warehousing of imported goods for export – Allegation of diversion of goods – Demand of duty – Appellants were importing High Speed Diesel and Furnace Oil and getting same warehoused in terms of Section 85 of the Act for export thereof – After detailed investigation, department alleged that goods covered by shipping bills filed by Appellants have not exported to declared vessel but were diverted/illegally supplied – After due process of law, Adjudicating authority confirmed demand of customs duty and imposed penalties on Appellants – Whether department has established diversion of disputed goods with sufficient evidence – HELD – For purpose of causing import and subsequent warehousing of Furnace Oil and HSD, importers are filing warehousing bond/undertaking in terms of Section 59 of the Act subscribing the declaration that imported bunker fuel would be exported in form of supply to vessels under foreign run – On execution of Warehousing Bond by importers, such Furnace Oil and HSD are allowed to be warehoused in terms of Section 85 of the Act without payment of duty subject to compliance of undertaking filed by them under Section 59 of the Act – Case of department is that Appellants imported duty free Furnace Oil & HSD Fuel Oil under warehouse procedure and same was not supplied to any Foreign Going Vessel and diverted elsewhere – Documentary evidences produced by Appellants like acknowledgment by master of vessel and acknowledgment by Customs officers who escorted bunkers and supervised delivery to ships clearly established that bunkers covered under each of shipping bills were supplied to foreign going vessels – Department nowhere recovered any documents from business premises of Appellants, by which it can be established that Appellants have diverted the goods – Not a single customer is brought on records who received diverted goods – No evidence was produced regarding receipt of payment against alleged diverted goods – Case made out by Revenue cannot be sustained in absence of evidence showing diversion of duty free imported goods to other persons or in local markets – Impugned order passed by Adjudicating authority set aside – Appeals allowed
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