The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) in the case of Commissioner of Central Excise v Vijai Marine Services held that ‘casino vessels’ could not be classified as ‘pleasure boats’.
The issue before the Tribunal was with respect to the classification of ‘MV Royale Floatal’ i.e. a vessel manufactured by M/s Vijai Marine Services in which the Revenue aggrieved seeks re-classification of the goods under heading no. 8903 9990, instead of heading no. 8901 9000 accepted by the adjudicating authority.
The SCN was issued for recovery of undischarged duty liability on the ground that the vessel was intended for deployment as an ‘offshore casino’ to be operated on the Mandovi river in Goa and that under the pretext of clearing the same as a ‘conveyance’, the true intent of use and actual design of the impugned goods had been concealed to avail the consequences of the claimed classification.
The common ground of the present appeal was that the vessel was transformed from out of a ‘dumb barge’ and ‘other equipment’ imported by M/s Highstreet Cruises and Entertainment Pvt Ltd, Goa in June 2009, a subsidiary of M/s Delta Corp Ltd, which as also the holding company of M/s Delta Pleasure Cruise Company Pvt. Ltd. M/s Vijai Marine Services was contracted for the conversion into a self-propelled luxury floating hotel which, held in the impugned order to be ‘manufacture’. The clearance, at a declared value of ₹ 11.89 crores, had been effected at ‘nil’ rate of duty applicable to heading no. 8905 with an exemption under notification no. 12/2013-CE dated 1st March 2013.
The Coram constituting of members C.J. Mathew and Dr. S.K. Pati as technical and judicial members respectively held in favor of the assessee and declined to interfere with the order of the adjudicating authority. It held that ‘casino vessels’ could not be classified as ‘pleasure boats’.
The decision of re Ashok Khetrapal had been relied upon. It was held that a vessel for pleasure or sport should be meant for personal consumption/use of the person/owner of a vessel. It is evident from the facts on record that the vessel POG imported by the importer is not used for the personal use of the owner for pleasure or sport but is used for commercial purposes as a ‘Casino vessel’. Hence the vessel was held to be a passenger ship or Special Trade Passenger Ship when no contrary opinion of another competent authority is brought on record saying that POG is a vessel for pleasure or sport.Subscribe Taxscan AdFree to view the Judgment