Rectification for error apparent: later binding valuation precedent on retail-packed tiles justified recalling the earlier order.

Rectification under Section 35C(2) was sought on the ground that the earlier final order had not considered Rule 34(a) and departmental clarifications, but that objection was rejected because those matters had already been dealt with in the original order. A rectification proceeding cannot be used to reopen findings already recorded. The Tribunal nevertheless recognised that the later Supreme Court affirmation of the valuation principle for tiles supplied in retail packs to industrial buyers, where the goods were not marked for industrial use or non-retail sale, created binding law on MRP declaration and Section 4A valuation. Non-consideration of that later binding precedent was treated as an error apparent from the record, and the earlier final order was recalled.

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Issues: Whether the order dismissing the appeal contained a mistake apparent from record warranting rectification under Section 35C(2) of the Central Excise Act, 1944, particularly on account of non-consideration of the applicability of Rule 34(a) of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 and the binding effect of the later affirmed decision on valuation under Section 4A of the Central Excise Act, 1944.

Analysis: The plea that Rule 34(a) and the departmental clarifications had not been considered was rejected as factually incorrect, since those aspects had already been dealt with in the original final order. A rectification proceeding under Section 35C(2) cannot be used to re-open the correctness of findings already recorded. However, the Tribunal accepted that the later affirmation by the Supreme Court of the decision holding that tiles supplied in retail packs to industrial buyers, when not marked as meant for industrial use and not for retail sale, attract the requirement of declaration of MRP and valuation under Section 4A, constituted a binding precedent. In light of the Larger Bench principle that non-consideration of a subsequently declared binding law can amount to an error apparent from record, the earlier final order was held to suffer from such an error.

Conclusion: The rectification application was allowed and the earlier final order was recalled.

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