ORDER
G. Sankaran, Member (T)
1. The captioned appeals were initially filed as Revision Applications before the Central Government which, under Section 35-P of the Central Excises and Salt Act. 1944, have come as transferred proceedings to this Tribunal, for disposal as if these were appeals filed before it.
2. The two appeals involve a common issue and are, therefore, disposed off by this common order.
3. The appellants (hereinafter referred to as Bharat Petroleum), by a letter dated 13-10-1975 to the Assistant Collector of Central Excise, Bombay, sought permission to supply bunker supplies as ships stores, at the concessional rates of basic excise and Mineral Products Additional excise duties in terms of Notification No. 11/C.E., dated 5-4-1949, as amended by Notification No. 43/C.E, dated 11-11-1954, to lighterage vessels employed to unload crude oil cargo from giant tankers anchored 14 miles off the Indian Coast beyond the territorial waters and bring the cargo to an Indian port for discharge. The contention was that the lighterage vessels would really be engaged in importation of foreign cargo from a position outside the Indian territorial waters and, so, their voyages from the Indian port would be in the nature of “vessels bound for foreign destination.” Bharat Petroleum submitted a classification list on the above basis for approval. The Assistant Collector took the view that the lighterage vessels could not be deemed to be vessels bound for a foreign port and, on that basis, rejected the classification list filed by Bharat Petroleum. The appeal against this order was rejected by the Appellate Collector, Bombay, by his order of 9-6-1976. The Appellate Collector did not accept the contention that the lighterage vessels were engaged in foreign-bound journeys or coastal journeys (an alternative submission for concessional rates of duty admissible for vessels engaged in coastal voyages) since they did not touch any port, foreign or coastal, other than Bombay. It is against this order that the present appeal (54/76-C) is before us.
4. The other appeal (382/79-C) has arisen as a consequence of the rejection, by the lower authorities, of Bharat Petroleum’s claims for refund of duties paid by them, the grounds of the claim being the same as in Appeal No. 54/76-C. Our Order-in-Appeal No. 54/76-C would, therefore, dispose of the Appeal No. 382/79-C as well.
5. The learned Counsel for Bharat Petroleum has relied upon a Division Bench judgment of the Calcutta High Court in Turner Morrison & Co. Ltd. v. Assistant Collector of Customs and another-1976 TAX L.R. 2108. In this case, the super tankers could not enter the Indian Port, due to their deep draft requirements, for direct discharge of their cargo on the wharf. They, therefore, worked in moorings within or outside the harbour and discharged their cargo into a number of smaller lighterage vessels for carriage of the Cargo to the destination ports including Calcutta. These lighterage vessels either discharged a part of the cargo at the port where the lighterage took place and proceeded to Calcutta or proceeded direct to Calcutta or such other destination as the Government of India required. After consideration of the definitions of “Coastal goods” [Section 2(7) of the Act, 1962], “foreign-going vessel or aircraft” [Section 2(21)], “import” [Section 2(23)], and Section 87 (“Imported goods may be consumed on board a foreign-going vessel or aircraft”), Section 89 (“Stores to be free of export duty”), the Court held that the entire journey from the foreign port to the port of destination in India was one journey for carriage of imported goods. The carriage of goods by the lighterage vessels which the super tanker discharged on to them was merely a continuation of what the super tanker was required to do. The lighterage vessel was engaged in the carriage of goods between a port outside India and a port in India and, as such, it was a foreign-going vessel within the meaning of Section 2(21) during the period of such journey. On this basis, their Lordships quashed the demands for duties on the stores and fuel consumed by the lighterage vessel.
6. The Counsel submitted that unlike in the Turner Morrison case where the super tanker was within Indian territorial waters, the super tanker in the present case was anchored outside the Indian territorial waters and so the present appeal is, if anything, on a stronger footing.
7. The learned SDR submitted that the Calcutta High Court judgment referred to was under challenge before the Supreme Court which had admitted the SLP. He also submitted that the decision of the Calcutta High Court was not binding on this Bench which was located in Delhi. He cited a decision of the Madras Bench of this Tribunal reported in 1983 ECR 616-D in support of this submission.
8. Now, apart from the above considerations, let us examine the claim of Bharat Petroleum with reference to the relevant provisions of the Central Excise Law. This is necessary because in the Turner Morrison case, the question was with reference to customs duty on fuel and stores. In the present case, the question is with reference to excise duties. The matter has to be examined with reference to the provisions of the excise law rather than the customs law. The ratio of the Calcutta High Court judgment may not, therefore, squarely apply in the circumstances of the present case.
9. Central Excise Rule 12 provides that the Central Government may, by notification, grant rebate of duty paid on excisable goods if exported outside India, to such extent, and subject to such conditions and limitations as regards inter alia destination as may be specified in the notification. Notification No. 11 of 5-4-1949, issued under Rule 12 relevant for the present purpose read thus :
“Rebate of duty paid on excisable goods exported as Ship’s Stores- In exercise of the powers conferred by Rule 12 of the Central Excise Rules, 1944, and subject to the conditions prescribed in the Government of India, Ministry of Finance (R.D.) Notification No. 10-Central Excise, dated the 5th April, 1949 and in column 5 of the Table appended thereto, the Central Government is pleased to direct that rebate shall be allowed of the duty paid on all excisable goods exported as ship’s stores for consumption on board a vessel bound for any foreign port other than ports of Pondicherry, Karikal and Mahe :
Provided that the goods are in such quantities as the Customs Collector at the port of shipment may consider reasonable.”
However, on 17-11-1962, the Central Government issued another Notification No. 197/62 (again under Central Excise Rule 12), which superseded inter alia Notification No. 10 of 5th April, 1949. This notification provided for rebate of excise duty paid on the excisable goods specified in the Table annexed to the notification (which included Furnace Oil and certain other Petroleum products) on their exportation out of India, or the State of Pondicherry, as the case may be, to the destinations mentioned in column 3 of the Table. This column 3 read : “Any country or territory outside India excluding Nepal, Bhutan and Sikkim”. The extent of the rebate was the whole of the duty paid. Can it be said that the bunkers supplied to the lighterage vessels were for consumption on board a vessel bound for a foreign port, as laid down in Notification No. 11/49 or that their destination was a country or territory outside India, as laid down in Notification No. 197/62 ? Surely, a spot in the high seas beyond the territorial waters is not a foreign port nor is it a country. Is it a territory outside India ? The expression “Territory” has not been defined in the Central Excise or the allied law relating to Customs. The Concise Oxford Dictionary ascribes the following meaning to “territory” :
“n. extent of land under jurisdiction of sovereign, State, City, etc. ; (fig.) sphere, province; area over which goods-distributor or commercial traveller operates; large tract of land; (T) organized division of a country, esp. (US etc ) one not yet admitted to full rights of a State; (Zool.) area held by animal(s) against others of same species; area defended by team etc. in game.
The Chamber’s 20th Century Dictionary says :
“n. possessions in land : the whole, or a portion, of the land belonging to a state : part of a confederation with an organised government but not yet admittted to statehood : a dependency : region : a jurisdiction : field of activity (lit. and fig.): domain : area that an animal or bird treats as its own.”
10. From the above extracts, it is clear that “territory” essentially is relatable to a land-mass. It is only with reference to the land-mass that is a territory that the concept and expression of “territorial waters” would seem to have arisen. The latter expression is understood as the sea (within defined limits) adjoining a land-mass territory. It is, therefore, difficult to conceive of a place in the open seas, beyond the territorial waters, as a “territory” outside India. If the expression used in Notification No. 197/62 was “a place outside India” [as in Section 2(21) (iii)-definition of “foreign-going vessel or aircraft”-of the Customs Act, 1962] and not a territory outside India, or there was any other notification on the lines of Section 89 of the Customs Act, 1962, the position may well have been different. We had asked the Counsels on both sides whether the expression “territory” had been judicially interpreted but they could not throw any light in the matter. In the result, we have to conclude that a place beyond the territorial waters of India is not a “territory” outside India for the purpose of Notification No. 197/62 and, therefore, the benefit of the said notification was not available to Bharat Petroleum. Nor was the voyage of the lighterage vessel a coastal voyage in as much as it was only a voyage out of and back to the same port and not between two ports round the coast of the country.
11. In the light of the above discussions, we see no merit in the appeal which we, therefore, dismiss.
12. A copy of this order should be placed in each of the two appeal files.