COMMISSIONER OF CUSTOMS Vs. TAMIL NADU ELECTRICITY BOARD

JUDGEMENT

(1.) FINAL Order Nos. 1458 -1462/2005 dt. 31/10/05 M/s. Tamil Nadu Electricity Board (TNEB), the respondent herein, imported six consignments of "Steaming Coal" from Indonesia and filed the below -mentioned 6 Bills of Entry covering the quantities mentioned there against, claiming the benefit of concessional rate of duty allowed by the Central Government in Adhoc Exemption Order No. 172/92 dated 15th September, 1992 (F.No. 332/71/88 -TRU) issued under Sub -section (2) of Section 25 of the Customs Act 1962 read with Sub -section (4) of Section 111 of the Finance Act 1992:

(2.) HEARD both sides. A preliminary objection was raised by learned Counsel for the respondent (TNEB). It was submitted that, before the appeals were taken up for hearing, the impugned order of the lower appellate authority required to be complied with by Revenue as the application filed by them for stay of operation of the said order was rejected by the Tribunal. However, ld. counsel did not press the objection, upon being told by the Bench that final disposal of the appeals would not require so much time as might be required by the Department (in the event of the Tribunal directing them to comply with the impugned order) for compliance.

(3.) WE shall proceed to address the above arguments and ascertain whether it was necessary for the Commissioner (Appeals) to rely on the Criminal Court's judgment. Both the counsel have read out portions of that judgment to us. Learned Special Judge held, inter alia, that the test results reported by M/s. S.G.S. India Ltd., who were engaged by the Indonesian supplier of coal for monitoring the quality of the import consignments and were accepted by TNEB, should be treated as final and binding and that it was not open to the Customs authorities to draw samples of the goods and get them tested in any laboratory not authorized by TNEB and their supplier. It was also found that the procedures prescribed for sampling and analysis had not been followed by the laboratories engaged by the department and consequently their test results were incorrect, misleading and unreliable. The Asst. Collectors of Customs who passed the orders -in -original in this case were examined before the Criminal Court and their depositions were found to indicate that they had passed the orders as per the instructions of their superiors, without independent application of mind to the materials on record. The oral evidence of the Asst. Collectors and the CBEC Chairman (P.W. 10) became handy for the learned Special Judge to decry some of the findings recorded in the order -in -original. The Criminal Court was dealing with the charge that the accused had committed criminal breach of trust and criminal misconduct by entering into criminal conspiracy with five suppliers (Indonesian and Australian) of coal to misappropriate TNEB's funds in connection with import of coal from those countries, for pecuniary advantage to the suppliers, thereby causing loss to TNEB. In that process, the court examined, among others, the two Asst. Collectors and the CBEC Chairman as witnesses and recorded a finding, inter alia, thus: