Per P.G. Chacko:

The respondents, M/s. Hindustan Petroleum Corporation Limited (HPCL) imported consignments of petroleum (crude oil) through Visakhapatnam Port and filed into-bond Bills of Entry. Subsequently, they filed ex-bond Bills of Entry for clearance of the bonded consignments. The into-bond Bills of Entry were assessed provisionally under Section 18 of the Customs Act, 1962 and clearance was allowed on ex-bond Bills of Entry, pending test and receipt of Ullage Survey Report (in short, "US Report") and other documents. HPCL, later on, furnished US Reports and also the Cargo Intake Certificates (in short, "CI Certificates") duly attested by Central Excise authorities, and requested for finalisation of assessments on the basis of the quantities of crude oil received into the bonded tanks as per the CI Certificates furnished. The Customs authorities found that, in respect of each consignment, the quantity of crude oil discharged as per the vessel's US Report was in excess of the quantity specified in the CI Certificate. Show-cause notice (SCN) was issued to the respondents to show cause why the provisional assessment should not be finalised on the basis of the quantity specified in the US Report taken at the time of discharge of cargo, following the guidelines laid down by the Bombay High Court in its judgment dated 17.07.1986 in Writ Petition No. 1354/84 [reported in 1986 (25) ELT 948]. The respondents, in their reply, contested the calculations based on the US Report and contended that the quantity specified in the CI Certificate was more accurate. The Assistant Collector of Customs finalised assessment on the basis of quantity specified in the US Report following the aforesaid guidelines of the Bombay High Court and confirmed demand of differential duty to the extent of Rs. 1,16,83,917.00 in finalisation of 32 into-bond Bills of Entry covering imports of crude oil for the period June 1992 to December 1992 and another demand of differential duty of Rs. 1,74,17,091.00 in finalisation of another set of into-bond Bills of Entry covering imports for the period June 1992 to July 1993 as per Orders-in-Original dated 14.10.1993 and 31.03.1994 respectively. HPCL preferred appeals against these orders of the Assistant Collector to the Collector (Appeals) and the latter allowed the appeals. Hence the present appeal by the Collector of Customs, Visakhapatnam.

2. We have carefully examined the records of the case and heard both sides.

3. Ld. SDR, Dr. D.K. Verma stated the issue involved in the case thus :- Which of these two - the quantity of crude oil as revealed by the vessel's US Report or the quantity determined by dip measurement in the shore tanks as revealed by the CI Certificate - should be adopted for the purpose of assessment of duty on the imported crude oil? Reiterating the grounds of appeal, ld. DR submitted that, for the purpose of determining the amount of duty, the quantity revealed by the US Report ought to be adopted as the 'quantity imported'. In this connection, he relied on the Bombay High Court's judgment dated 17.07.1986 in W.P. No. 1354/84 vide Shaw Wallace & Co. Ltd. Vs. Assistant Collector of Customs & Others, 1986 (25) E.L.T. 948 (Bom.) as also on Public Notice No. 30/93 dated 25.06.1993 of the Collector of Customs, Visakhapatnam, which was issued on the model of a similar Public Notice issued by the Bombay Custom House in accordance with the guidelines of the High Court contained in its judgment in Shaw Wallace (supra). He also cited the decision of the Tribunal's South Zonal Bench (in short, SZB) in Chowgule Brothers Vs. Commissioner of Customs, 1996 (14) RLT 883 (Cegat)=1996 (85) E.L.T. 254 (T) wherein the High Court's guidelines in Shaw Wallace (supra) were followed. Ld. DR also placed reliance on the decision of the Tribunal's SZB in the case of Cochin Refineries Ltd. Vs. Commissioner of Customs, 1999 (30) RLT 807 (Cegat)=1999 (105) E.L.T. 108 (T) and submitted that this decision covered the instant