1997 (12) TMI 248 - AT - Customs

Summary

Issues:
1. Determination of propriety and correctness of an adjudication order regarding import of steel pipes under OGL.
2. Qualification of importers for clearance of goods as Actual User under OGL.
3. Allegations of unauthorized clearance under OGL and misuse of SSI certificate.
4. Consideration of statements obtained under Section 108 of the Customs Act as substantial evidence in adjudication proceedings.

Analysis:
1. The appeal was filed by the Commissioner of Customs, Bombay to challenge an adjudication order related to the import of Prime Seamless Carbon Steel Pipes. The order was issued by the Additional Collector of Customs, Bombay, directing the Tribunal to determine the propriety and correctness of the adjudication order.

2. The case revolved around whether the importers, M/s. Pradip Smithy and Engineering Works, qualified for clearance of the imported steel pipes as Actual User under OGL Appendix 6. The department's case was based on the importers' manufacturing activities, their SSI registration certificate, and allegations of unauthorized clearance and misuse of the imported goods.

3. The Additional Collector dropped the charges against the importers, citing that the importers appeared capable of using the imported goods based on their SSI registration, manufacturing activities, and verification by Central Excise Authorities. However, the Tribunal found the Additional Collector's conclusion not well-founded. The Tribunal emphasized the need to consider statements obtained under Section 108 of the Customs Act as substantial evidence. The statements implicated the importers and other individuals in the unauthorized clearance and misuse of the SSI certificate.

4. The Tribunal held that a thorough examination of the evidence, including the statements of involved parties, was necessary before dropping the charges. Since the statements were consistent and none of the parties retracted their statements, the evidential value remained strong. Therefore, the Tribunal set aside the impugned order and directed a re-adjudication of the matter to determine the liability of the importers for penalty under the Customs Act, ensuring a fair hearing for all parties involved.