2002 (2) TMI 689 - AT - Central Excise

Appellate Authority upholds duty demand & penalties, stay application leads to case referral to Larger Bench.

The Appellate Authority's decision confirming duty demand and penalties against the Assessee and others was upheld. A stay application for a personal ... Personal hearing before adverse order on stay/pre-deposit - binding effect of High Court decisions within a West Regional Bench (WRB) jurisdiction - conflict of Tribunal precedents and reference to a Larger Bench - application of Supreme Court precedent concerning personal hearingPersonal hearing before adverse order on stay/pre-deposit - application of Supreme Court precedent concerning personal hearing - Validity of the Single Member's approach in refusing modification and dismissing stay/appeal without affording personal hearing in the light of higher court precedents - HELD THAT: - The Tribunal recorded disagreement with the Single Member decision which dismissed the appellant's request and relied on Dewas Die Casting. The Bench noted that the Gujarat High Court in Ricoh India Ltd. had held that personal hearing must be given even in stay matters and that the Supreme Court's decision in Union of India v. Jesus Sales Corporation requires personal hearing. A TwoMember Bench in Entek IRD followed the Gujarat High Court and set aside similar orders by the Commissioner (Appeals). Since the Single Member's decision did not take these authorities into account and the principle of personal hearing as articulated by higher courts is material to stay/predeposit orders, the Tribunal found the Single Member's reliance misplaced.The Single Member's approach of refusing modification and dismissing the appeal without personal hearing is not accepted; the matter requires reconsideration in the light of binding higher court precedent on personal hearing.Binding effect of High Court decisions within a West Regional Bench (WRB) jurisdiction - conflict of Tribunal precedents and reference to a Larger Bench - Whether the conflict between the Single Member's decision and divisional/High Court precedents warrants reference to a Larger Bench - HELD THAT: - The Bench observed that the Single Member did not advert to the TwoMember Bench decision which followed the Gujarat High Court and that the Gujarat High Court's view is binding on matters arising in its territorial ambit (WRB). Given the apparent conflict between the Single Member decision and earlier TwoMember/High Court authorities on the same issue, the Tribunal considered that the conflict should be resolved by a Larger Bench. Consequently, the Registry was directed to place the matter before the President for constitution of a Larger Bench to hear and decide the controversy.Conflict in Tribunal precedents and the binding effect of the Gujarat High Court's decision justify reference to a Larger Bench; the matter is to be placed before the President for constitution of a Larger Bench.Final Conclusion: The Tribunal disagreed with the Single Member's order, observed that binding High Court and TwoMember Bench authorities require personal hearing in stay/predeposit matters, and directed the Registry to place the matter before the President for constitution of a Larger Bench to decide the conflict. The appeal was filed against the decision of the Commissioner of Central Excise (Appeals) Mumbai-III for violation of Central Excise Rules. The duty demand was confirmed, and penalties were imposed on the Assessee and others. The Appellate Authority dismissed the appeal, but a stay application was made citing the need for a personal hearing. The case was referred to a Larger Bench for further review.