CHIEF ENGINEER/MECH/COAL, Vs. COLLECTOR OF CUSTOMS

JUDGEMENT

(1.) TAMIL Nadu Electricity Board imported 20153 MTs of steaming coal in bulk from Indonesia through Vessel 'Maritime Lapis' and filed a Bill of Entry on 10 -9 -1993 through their Customs House Agent for clearing the same claiming concessional rate of duty for the coal in terms of ad hoc exemption Order No. 72/92, dated 15 -9 -1992. Since the coal was urgently required by the appellants, their request for release of the consignment after making provisional assessment in terms of Section 18 of the Customs Act, pending test results, was allowed after the appellants furnished a test bond supported by bank guarantees. Sample of the coal was drawn and sent for test to 3 laboratories viz. National Metallurgical Laboratory (Central Fuel Research Institute; Dhanbad), Indian Institute of Technology, Madras and ITA Labs. P. Ltd., Madras and the test reports showed that the calorific value of the coal was below 60,000 Kcal/Kg. and that it ranged from 5600 Kcal/Kg. to 5930 Kcal/Kg. The adjudicating authority finalised the provisional assessment without extending the benefit of ad hoc exemption order, holding that the exemption was granted to import of good quality coal i.e. coal having 6500 Kcal/Kg. gross calorific value and since the calorific value of the imported coal was less than the above mentioned value, it was not covered by the exemption Order No. 72/92. He, therefore, held that the appellants were liable to pay the standard rate of duty i.e. Rs. 2,32,09,429/ -, duty provisionally paid was Rs. 83,21,965/ - and hence the differential amount came to Rs. 1,48,87,464/ - and the bank guarantees were enforced to the extent of this amount for realisation of difference in duty.The lower appellate authority upheld the order of the Assistant Collector, holding inter alia that the intention of the Government of India while issuing ad hoc exemption order was to permit importation of good quality coal; hence this appeal.

(2.) WE have heard Shri M.A. Krishnamurthy; learned Advocate and Shri K. Srivastava, learned SDR.

(3.) THE relevant Notification is reproduced below.