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TMI Blog1993 (6) TMI 172X X X X Extracts X X X X X X X X Extracts X X X X ..... to grant the consequential benefit arising out of its final Order No. 773/91-A, dt. 30-9-1991. Earlier they had filed a Miscellaneous Petition before the Tribunal, which was allowed by the Tribunal, and vide their Miscellaneous Order No. 230/92-A, dated 8-9-1992, the Collector of the Customs, Kandla was directed to implement the Order No. 773/91-A, dated 30-9-1991, within one month from 8-9-1992. 3. As the Collector of Customs, Kandla did not implement the Order of the Tribunal, dated 30-9-1991, as directed by their Misc. Order dated 8-9-1992 present Miscellaneous Petition, dated 8-9-1992, has been filed by the applicant. 4. It may be mentioned that under their final Order No. 773/91-A, dated 30-9-1991, in Appeal No. C/3894/88-A, the Tribunal have affirmed the Order-in-Appeal No. 3161/88-A, dated 29-8-1988, passed by the Collector of Customs (Appeals), Bombay, and held that the Department was justified in giving 30% reduction in value for the purpose of abatement under Section 22 of the Customs Act, 1962 (hereinafter referred to as the `Act ). The party had requested for 50% reduction. 5. The Collector of Customs (Appeals), Bombay under his Order No. 3161/88, dated 29-8-1988 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bombay, has again come up before us by way of appeal of the Collector of Customs (Appeals), Ahmedabad. 11.The Collector of Customs (Appeals), Ahmedabad set aside the Order-in-Original of the Deputy Collector of Customs, Kandla under his Order dated 4-9-1992, much after the Order of the Tribunal dated 30-9-1991. 12. In his Order, the Collector of Customs (Appeals), Ahmedabad has stated that the issue before the Tribunal pertained to the higher claim for reduction in the value of the imported consignment in question to the extent of 50% against 30% allowed by the Deputy Collector of Customs, Kandla. 13. The Collector of Customs (Appeals), Ahmedabad has allowed the appeal of the Collector of Customs and Central Excise, Rajkot, on the following grounds :- (1) The contamination of the imported PVC synthetic resin cargo took place 3 1/2 months after its unloading from the vessel, and not at the time of its landing. (2) The appellants failed to produce any evidence to show that the vessel in which the imported goods were carried had also brought cargo other than PVC. (3) That the Tribunal did not at all go into the question of admissibility of 30% deduction in value. (4) Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Customs Department, and were found to be damaged. The chemical report confirmed the damage. He submitted that the Tribunal s orders have not been implemented, and in place of implementing the orders of the Tribunal, the Collector of Customs (Appeals), Ahmedabad came to a contradictory finding, which was not correct in law. 19. He requested that the Orders passed by the Collector of Customs (Appeals), Ahmedabad may be vacated, and the Collector of Customs, Kandla be directed to implement the Tribunal s Orders, and give them consequential relief. 20.In support of his arguments, he relied on the following citations:- (1) 1983 (13) E.L.T. 1651 (SC) = (1981) 48 STC 248. (2)AIR 1963 SC 1124. (3) (1991) 80 STC 42. (4) (1992) 86 STC 412. (5) (1989) 176 ITR 515. 21. Shri A.K.Singhal, learned JDR submitted that the Order passed by the Collector of Customs (Appeals), Ahmedabad was correct. The samples have been discussed by the Collector in his Order. He added that the entire consignment was not lost. He reiterated the order appealed against, and relied on the findings of the Collector of Customs (Appeals), Ahmedabad. 22.We have carefully gone through the arguments advance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nately. (7)Being dissatisfied with the Order, dated 29-8-1988 of the Collector of Customs (Appeals), Bombay, (Sr. No. 6 above), the appellants filed the appeal in the Tribunal. (8) The Department did not file any cross objections with regard to the grounds of appeal of the appellants, urged before the Tribunal. (9) The Tribunal disposed of the matter in September, 1991, by affirming the decision of the Collector of Customs (Appeals), Bombay (who had affirmed the decision of the Deputy Collector of Customs, Kandla). The Tribunal held that on the basis of available evidence, 30% overall depreciation allowed by the lower authorities was quite reasonable. (10)In January 1989, the Deputy Collector of Customs, Kandla filed appeal against the Order dated 28-1-1988, referred to above in serial No. (4), as directed by the Collector of Customs and Central Excise, Rajkot, with the Collector of Customs (Appeals), Ahmedabad. (11)The party filed Cross Objections with the Collector of Customs (Appeals) in June/July/August 1992. (12) In August, 1992, the party filed miscellaneous petition for seeking direction under Rules 40 and 41 of the CEGAT (Procedure) Rules, 1982, to implement the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omes final. 29. Under Section 129B of the Act, the Appellate Tribunal may after giving the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or annulling the decision or Order appealed against, or may refer the case back to the authority who passed such decision or order with such directions as the Appellate Tribunal may think fit, for a fresh adjudication or decision, as the case may be, after taking additional evidence, if necessary. 30. It has been provided in sub-section (4) of Section 129B that save as otherwise provided in Section 130 (Statement of case to High Court), or Section 130F (Appeal to the Supreme Court), orders passed by the Appellate Tribunal on appeal shall be final. 31. The Collector of Customs (Appeals) is an authority subordinate to the Tribunal under the provisions of Rule 40 of the CEGAT (Procedure) Rules, 1982. Rule 40 provides that the Tribunal shall exercise control over the departmental authorities in relation to all matters arising out of the exercise of the powers or of the discharge of the functions of the Tribunal. 32. The Collector of Customs (Appeals) had no authority to si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asis of the report dated 21-11-1985 of the marine surveyors, the Tribunal has also observed vide para 8 of its decision that out of 73290 bags of the PVC Resin landed, only 39024 bags were in slack/torn condition, while the remaining bags were in sound condition. The Tribunal has also noted that the reliance placed by the respondent on the credit notes of the supplier could not be considered for determining extent of depreciation in the value. 18. In view of the foregoing, it is thus evident that there was no occasion for CC(Appeals), Bombay as well as CEGAT to give their finding about the admissibility of 30% reduction in value, as allowed in the impugned order, since these two appeals were filed by the respondent importer for claiming higher reduction of 50% in the value. Thus, the issue before them was different. In view of this matter, the respondents contention for non-maintainability of the present appeal filed by the department is without any basis, and hence, not tenable. The doctrine of merger cannot be applied to the facts of this case." 34. Let us now critically examine the Order-in-Appeal passed by the Collector of Customs (Appeals), Ahmedabad, along with the conne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the Tribunal. 36. The Tribunal had come to a finding that the department was justified in giving 30% reduction in value for the purpose of giving abatement under Section 22 of the Customs Act. 37. In the light of these findings, the statement of the Collector of Customs (Appeals), Ahmedabad that In fact both Collector of Customs (Appeals), Bombay and CEGAT while disposing of the respondents appeals have not at all gone into the question of admissibility or otherwise of 30% reduction in the value of the imported goods which was the subject matter of this appeal , is not correct. 38. His observations in para 20 of his order are contradictory to the facts as summarised by him in para 2 and 3. 39. He has not given any basis except the initial order of the Deputy Collector of Customs, Kandla, (which had been revised on de novo adjudication), for his findings. 40. In the case - Tel Utpadak Kendra v. Deputy Commissioner of Sales Tax (1981) 48 STC 248 , the Hon ble Supreme Court have observed that when the appellate jurisdiction of a superior authority is invoked against an order and that authority is seized of the case, it is inconceivable for a subordinate authority to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder of the Appellate Authority which is the operative order after the appeal is disposed of, whether the appellate authority has reversed the original order or modified it or confirmed it. 47. The decision in the case - Santoshi Tel Utpadak Kendra v. Deputy Commissioner of Sales Tax, 1983 (13) E.L.T. 1651 (SC) = (1981) 48 STC 248 (SC), was followed by the Supreme Court in the case of Khandelwal Ferro Alloys Ltd. v. State of Maharashtra (1991) 80 STC 42. 48. They added in para 10 of their judgment that the Tribunal was superior to the Commissioner even in revisional jurisdiction. 49. The Supreme Court also affirmed the full bench decision of the Karnataka High Court in the case of C.I.T. v. Hindustan Aeronautics Ltd. (1986) 157 ITR 315, that in cases where issues which could have been dealt with by the Appellate Authority but have not in fact been dealt with, entire order merges irrespective of the points urged and decided, and the Commissioner is precluded from exercising revisional jurisdiction, even on the point not urged and/or not decided. 50. In the case - Orient Paper Mills, Shahdol v. Collector of Central Excise, Bhubaneswar 1985 (19) E.L.T 451, the Tribunal observe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Appellate Collector is binding on the Assistant Collector working within his jurisdiction and the order of the Tribunal is binding upon the Assistant Collector and the Appellate Collector who function under the jurisdiction of the Tribunal. The principles of judicial discipline require that the orders of the Higher Appellate authorities should be followed unreservedly by the subordinate authorities. The mere fact that the order of the Appellate authority is not `acceptable to the department - in itself an objectionable phrase - and is the subject matter of an appeal can furnish no ground for not following it unless its operation has been suspended by a competent Court. If this healthy rule is not followed, the result will only be undue harassment to assessee, and chaos in administration of tax laws. 57. In the case - Hasmukh Lal Amrit Lal Mehta and Others v. N.B. Sonavene and Others 1982 (10) E.L.T. 67 (Bom.), the Bombay High Court has held that the Collector was bound by the order passed by the revisional authority. 58. In the case - Sandip Agarwal v. Collector of Customs - 1992 (62) E.L.T. 528 (Cal.), the Calcutta High Court has held that the order of the appellate a ..... 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