[Order per : P.G. Chacko, Member (J)]. - The appellant had filed two bills of entry for clearance of Populated Printed Circuit Boards (PCBs) during August-September, 1990. Clearance was sought against Additional Licences procured by the importer in terms of Para 216 of the Import and Export Policy, 1988-91. The appellant wanted to clear the goods as an OGL item in terms of Entry no. 821(15), Appendix 6, List 8, Part I of the above Policy 1988-91. The said entry stood for “Printed circuit boards other than those in Appendix 3 Part A”. On examination of the goods and scrutiny of the provisions of the Policy, the Customs authorities took the stand that Populated PCBs were specifically covered by Appendix 2, Part B, and therefore it was a restricted item which could be imported only against a specific import licence. The importer contested this stand of the department. Thus a dispute arose between the department and the appellant. The relevant show-cause notice was adjudicated upon by the ld. Collector of Customs by an order dated 30-4-1992. The ld. Collector held the Populated PCBs to be covered under Entry 135 of Appendix 2, Part B of the EXIM Policy, 88-91 and, in the absence of specific import licence, he held the goods liable to confiscation under Section 111(d) of the Customs Act. As the goods were not available for confiscation, he imposed redemption fine in lieu of confiscation of the goods covered by both the bills of entry. The present appeal is directed against the Collector’s order.
2. After hearing the ld. counsel for the appellant and the ld. SDR for the respondent, we find that this case is fit to be summarily disposed of in the interest of judicial discipline. In the impugned order, the ld. Collector of Customs found that the substantive issue in the case was covered by a decision of this Tribunal vide Atari (India) Electronics v. CC - (T). In the said case, this Tribunal had occasion to consider identical issue for an earlier period and construe the same in relation to import of loaded PCBs. Rival arguments which were made with reference to the provisions of Import Policy 1985-88 were considered and the provisions were examined in detail. In the result, Loaded PCBs (which are, admittedly, otherwise called Populated PCBs) imported by M/s. Atari (India) Electronics were held to be importable under OGL. The present appellant heavily relied on that decision before the Collector of Customs. Ld. Collector, however, refused to follow the precedent. He chose to embark on independent interpretation of the provisions of the EXIM policy and arrived at his own conclusions. While doing so, he also made certain references to, and remarks about, the Tribunal’s decision in Atari (India) Electronics case. We refrain from commenting itemwise on the Collector’s references/remarks as, we think, it is beyond the scope of this appeal. The relevant paragraphs (16 to 21) are reproduced below :-
“16. I will now deal with the decision of the Calcutta Regional Bench of the Tribunal in these case of M/s. Atari which has been cited by the Counsel in support of his proposition.
17. The Tribunal has taken the view that since the O.G.L. entry does not exclude goods figuring in Appx-2, Part B, the exclusion will only of those printed circuit boards which figure in Appx-3, Part-A. I have carefully gone through the Tribunals decision and I find that the Tribunal has gone wrong in its assumptions. In para 7 of its order the Tribunal has observed that if populated printed circuit boards go to Appx-2, Part B and printed circuit boards go to Appx-3, Part A nothing else will remain to be imported under O.G.L. thereby rendering the O.G.L. entry redundant and meaningless. With respect, this observation is not at all correct. As mentioned by me earlier populated printed circuit boards and one sided printed circuit boards will go to Appx-2, Part B and the multi-layer printed circuit boards beyond 4 layers alone can be imported under the residuary O.G.L. entry. It is therefore not that nothing will be available under O.G.L., as assumed by the Tribunal.
18. The Tribunal also, with respect, has gone wrong in interpreting Para 21(c) of the policy. The Tribunal has assumed that when a particular item figures with a specific description in Appx-2, Part B or Appx-3, Part-A it will prevail over an item with a generic description in Appx-2, Part-B and Appx-3, Part-A only in terms of Para 21(c). Whether an item figures by specific description or by generic description in the same appendix does not make any change. In fact reference to “any of these Appendices” in para 21(c) is a reference to the other Appendices in the policy and it is not restricted to these Appendices alone, which has been wrongly assumed by the Tribunal. The Tribunal has also wrongly interpreted Para 21(f) of the policy while holding that the O.G.L. entry which permits import of printed circuit boards not covered by Appx-3, Part- A as a specific entry for import of all types of printed circuit boards particularly populated printed circuit boards and that in terms of Para 21(f) it should be held that this entry allows import of populated printed circuit boards specifically.
19. With respect, therefore, the Tribunals order does not correctly interpret the provisions of the policy nor the provisions of the various Appendices in this order. In fact, the Calcutta Custom House made an application to the Tribunal to refer this question of law to the High Court. So far as the Regional Bench of the Tribunal is concerned, their decisions on facts are final and so far as law points are concerned, the departmental authorities can only make a request to the Tribunal for referring such question of law to the High Court. Unfortunately the application of the Calcutta Custom House requesting the Tribunal to refer this question to the High Court was rejected by the Tribunal as time-barred.
20. Normally a decision given by any superior authority particularly the Tribunal has almost a binding effect and in any case carries a lot of authority. I cannot dispute that contention of Advocate Mr. Bulchandani which is also supported by case law on the subject that the departmental authorities should give due regard to the orders of the Tribunal and follow the law laid down by them. However, the Tribunal’s decision which is only a fact finding authority does not have the same binding effect as a decision of the jurisdictional High Court and of the Supreme Court. Under the constitution of India a decision given by the jurisdictional High Court has binding effect within its territory and a decision of the Supreme Court is binding all over India. So far as the decisions of the tribunal are concerned, they are not binding to such an extent that if found wrong, they act as binding precedents. As mentioned earlier while I have all the respect for any decision of the Tribunal and for this decision of the Tribunal in the case of M/s. Atari in my view the Tribunal has totally mis-interpreted the provisions of the policy and gone to the extent of allowing goods figuring in the highly restricted category of Appx-2, Part B under O.G.L., I am unable to follow this decision as a binding precedent for all time to come. The stakes involved in the case decided by the Calcutta Regional Bench were hardly to the tune of Rs. 30,000/- and Rs. 25,000/- as fine in lieu of confiscation, while following this decision of the Tribunal in large number of cases benefit was sought to be derived by the importers in Bombay where in view of the decision of the Calcutta Bench of the Tribunal the Bombay High Court started giving clearance of the goods provisionally vide interim orders but permitted the department to adjudicate the cases later on.
21. Since in my view the Tribunals decision is totally wrong, and a wrong decision cannot be perpetuated for ever, I have no option but to differ from the Tribunals decision, though without meaning any disrespect to the authority of the Tribunal. The wide proposition of law urged by Advocate Mr. Bulchandani that a decision of the higher authorities even if wrong has to be given effect to and should be followed cannot be accepted. So far as the decision given in the particular case is concerned, the decision of any authority becomes binding unless it is reversed or upset by following the prescribed procedure of law. So far as its binding effect in future cases is concerned, according to me this prerogative is available only to the jurisdictional High Court and the Supreme Court of India which alone under the Constitution of India are final authorities in deciding legal issue. The Tribunal on the other hand is the only a fact finding authority and any law laid down by it does not have binding effect in the same manner, though it carries a lot of authority. In any case when the Tribunal appears to have gone wrong in a particular case, such a decision will certainly not become a binding precedent. That is why I have to hold in this case.”
3. Ld. Collector of Customs thought that the Tribunal being the final fact finding authority in cases arising under the Customs Act, etc., could create binding precedents on questions of facts only and that, on questions of law, the Tribunal could not create such precedents. He says that only decisions given by the Jurisdictional High Courts or by the Supreme Court on questions of law can bind the customs authorities. His ignorance of the basic tenets of judicial discipline is, indeed, pitiable. Ld. Collector should have paid heed to the relevant rulings of the Hon’ble Supreme Court. In the case of Union of India v. Kamlakshi Finance Corporation Ltd. - (S.C.), their Lordships had made the following observations :
“.......It cannot be too vehemently emphasised that it is of utmost importance that, in disposing of the quasi-judicial issues before them, revenue officers are bound by the decisions of the appellate authorities. The order of the Appellate Collector is binding on the Assistant Collectors working within his jurisdiction and the order of the Tribunal is binding upon the Assistant Collectors and the Appellate Collectors 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 assessees and chaos in administration of tax laws.”
“................... there can be no justification for any Assistant Collector or Collector refusing to follow the order of the Appellate Collector or the Appellate Tribunal, as the case may be, even where he may have some reservations on its correctness. He has to follow the order of the higher appellate authority. This may instantly cause some prejudice to the Revenue but the remedy is also in the hands of the same officer. He has only to bring the matter to the notice of the Board or the Collector so as to enable appropriate proceedings being taken.........”
Ld. Collector ought to have borne in mind that, where no decision to the contra on a given issue by the High Court or the Supreme Court was available, the decision of the Tribunal was a binding precedent. In the impugned order, ld. Collector fortunately has not claimed that the issue on hand was covered by any decision of the jurisdictional High Court or of the Supreme Court. Had there been any such decision, the same, of course, would have held the field. In the absence of such decision, the decision of the Tribunal had binding effect and the Collector had no option to defy the same. He had no business to sit in judgment over the Tribunal’s decision, though it was open to him to say that the Tribunal’s decision was not applicable on account of distinguishability of the facts of the case. The Collector did not even attempt to distinguish the facts of his case from those of Atari (India) Electronics case. He never noted anywhere in the impugned order that the Tribunal’s decision in Atari (India) Electronics case was distinguishable factually or otherwise from the case on hand.
4. Another aspect needs mention. The department had filed a reference application with the Tribunal against the order passed in Atari (India) Electronics case, but that application was dismissed as time-barred. Against an order of the Tribunal dismissing a reference application, there was a remedy in law in those days but the department never chose to take recourse to it. Consequently, the Tribunal’s decision in Atari (India) Electronics case attained finality and the same was only liable to be followed in the similar case of M/s. Videocon International Ltd.
5. Let the stand taken by the learned Collector be considered as an ignoble episode in the department’s history. Let the nobility of judicial discipline be upheld as a vital ingredient of the rule of law. We trust, the adjudicating and appellate authorities in the department will honour this great principle to avoid anarchy in the field of administration of law and justice.
6. The Collector’s order is set aside and this appeal is allowed with consequential relief to the appellant.
(Dictated in Court)
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