ORDER
T.K. Jayaraman, Member (T)
1. This appeal has been filed against Orders-in-Appeal No. 2-43 /2005 (V-II) Cus. dated 28.2.2005 passed by the Commissioner of Customs & Central Excise (Appeals), Visakhapatnam.
2. The appellants imported palm oil. They filed Bill of Entry for a quantity of 999.841 MT. However, the quantity discharged on the basis of ullage survey was found to be 1001.623 MT. The appellant filed refund claim for refund of 1,06,031/- claiming the same as the differential duty between the quantity as per ullage and that received at shore. The Asst. Collector rejected the refund claim based on Para 7 of Board’s Circular No. 96/2002 Cus. dated 27.12.2002. The appellants approached the Commissioner (Appeals). The Commissioner (A) rejected the party’s appeal. Hence, they have come before the Tribunal for relief.
3. Shri B.V. Kumar, learned advocate appeared for the appellants and urged the following points.
(i) In the case of bulk liquid cargo imports, which are discharged through regular pipelines into storage tanks, whether the duty should be paid on the quantity determined in terms of ullage survey report or whether the duty should be paid on the quantity determined on the basis of the shore tank is the issued to be decided.
(ii) In the instant case, it is an admitted position that the impugned goods were discharged into shore tanks in the presence of Customs officers, Owner’s Surveyors, Receiver’s Surveyors and the Chief Officer of the Vessel. The quantity received in the storage tank is 991.676 MTs as against the Ullage Survey Report showing 1001.623 MTs on which duty was collected.
(iii) It is now settled law that where bulk liquid cargo is discharged into storage tanks through pipelines, then duty is required to be paid on the quantity received into the storage tanks and not on the quantity arrived at on the basis of the Ullage Report.
a. NOCIL v. CC 2000 (126) ELT 1072 (T), which is affirmed by Supreme Court in 2002 (142) ELT A 280 (SC).
b. Godrej Industries Ltd. v. UOI
c. BPCL v. CC (Imports), Mumbai .
4. The learned JDR Shri K. Sambi Reddy referred to Board Circular dated 27.12.2002 wherein it is clarified that when bulk liquid cargo is cleared directly on payment of duty under a white bill of entry, assessment may continued to be done as per ship’s ullage survey report.
5. We have gone through the records of the case carefully. In certain bulk liquid cargo, the duty is levied at specific rates. For example, the duty may be a particular amount per metric tonne. In such cases, duty is leviable on the quantity received. There is always a difference between the quantity ascertained through ship’s Ullage and that received in the shore tank. By now it is well settled that in respect of bulk liquid cargo, the assessment has to be done on the basis of shore tank receipt in terms of Supreme Court’s decision dated 20.2.2002 in the case of CC, Mumbai v. NOCIL (supra). Board’s Circular dated 27.12.2002 also clarifies that when the cargo is discharged in shore tank, then assessment has to be done on the basis of the quantity received in shore tank. In these circumstances, the decision of the lower authority to finalize the assessment on the basis of ship Ullage is not correct. Therefore, the appellants are rightly entitled for the refund claim on account of the difference between the shore quantity and the Ullage survey quantity. Appeal is allowed.
(Operative portion of this Order was pronounced in open court on conclusion of hearing)