TaxTMI 
TaxTMI 
TaxTMI 
2010 (1) TMI 526
X X X X Extracts X X X X
X X X X Extracts X X X X
....reign Trade Policy 2004-2009 and can be imported without a licence as per para 2.17 of Foreign Trade Policy 2004-2009 though it becomes operational only after it is attached or fitted/coupled with equally important machine namely an alternator. Question of Law : 2. The said appeal was admitted by this Court vide order dated 8th June, on 2006 to consider following substantial question of law : "Whether an old, used and reconditioned Wartsila Vasa Basic Engine will quality as "capital goods" for the purpose of para 9.12 of Foreign Trade Policy 2004-2009 and can be imported without a licence as per para 2.17 of Foreign Trade Policy 2004-2009 though it becomes operational only if attached or fitted/coupled with equally important machine name....
X X X X Extracts X X X X
X X X X Extracts X X X X
....heir reply dated 11th March, 2005 and 8th April, 2005. After affording personal hearing to the petitioner, the Commissioner of Customs (Import) vide its order dated 3rd May, 2005 confiscated goods under Section 111(d) of the Act giving respondent an option to redeem the same on payment of Rs. 60 lacs. The Commissioner imposed penalty of Rs. 10 lacs under Section 112(a) of the said Act. The Commissioner held that the imported diesel engine/prime mover cannot be considered as "capital goods" as it was not covered by the definition of "capital goods" under para 9.12 of the Foreign Trade Policy. The Commissioner observed that the diesel engine was not a power generating set on its own and could become so only if attached to an alternator. The C....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iew taken by the Tribunal. He further went on to submit that the impugned decision of the Tribunal runs counter to the judgment of the Tribunal itself in the case of Khurana Exports v. Commissioner of Customs, Pune - 2004 (177) E.L.T. 431 (Tri-Mumbai). He submits that no reference to the said judgment is to be found in the impugned order though, according to him, heavy reliance was placed thereon. 10. Per contra, Mr. Sridharan, learned Counsel appearing for the respondent tried to support the impugned order contending that the said view is in consonance with the view taken by the Apex Court in the case of Commissioner of Income Tax v. Mir Mohammad Ali (1964) 53 ITR 165 (SC), wherein, the Apex Court ruled that the diesel engine is clearly "....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of the Tribunal either to consider the said judgment or distinguish it or to refer it to the Larger Bench if contrary view was warranted. 14. A similar contingency was required to be considered by this Court in the case of Mercedes Benz India Private Limited. v. Union of India and Others in Writ Petition No. 1614 of 2010 decided on 17th March 2010 (unreported), [Since reported in 2010 (252) E.L.T. 168 (Bom.)] wherein, we were required to set aside the impugned order and remit it back to the Tribunal for consideration afresh, borrowing observations made by the Apex Court in the following words : We are not happy to observe but constrained to say that one must remember that pursuit of the law, however glamorous it is, has its own limitation....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hat the judgments of the Tribunal are subject to scrutiny by High Courts, especially, in exercise of appellate jurisdiction and/or writ jurisdiction. The Higher Courts are expected to read the mind of the Lower Authority. In absence of reasons, it become difficult for the higher Courts to consider the issue involved in the case and the view taken therein. Reasons substitute subjectivity by objectivity. The emphasis on recording reasons is that if the decision reveals the "inscrutable face of the sphinx", it can, by its silence, render it virtually impossible for the Courts to perform their appellate function or exercise the power of judicial review in adjudging the validity of the decision. Right to reason in an indispensable part of sound ....