Omission of Section 3A and Rule 96ZP(3) liability prompted Division Bench reconsideration amid conflicting Tribunal views.

Conflicting Tribunal and High Court views on whether omission of Section 3A extinguished proceedings under Rule 96ZP(3), together with the effect of Section 38A's saving provision, required reconsideration by a Division Bench. The analysis noted that the Revenue's challenge concerned non-imposition of penalty equal to the outstanding duty, while the assessee's appeals raised separate questions on the doctrine of merger and the scope of the dispute. In light of the divergent authorities on survival of accrued liability after omission of the enabling provision, the papers were directed to be placed before the President for appropriate reference.

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Issues: Whether the appeals, in view of conflicting decisions on the effect of omission of Section 3A and the survival of proceedings under Rule 96ZP(3), should be placed before a Division Bench for reconsideration.

Analysis: The appeals arose from a refusal to entertain the Revenue's challenge to non-imposition of penalty equal to the duty outstanding under Rule 96ZP(3). The order analysed the scope of the assessee's appeals, the doctrine of merger, and the distinct question raised by the Revenue regarding higher penalty. It also noted conflicting Tribunal decisions holding that proceedings under the compounded levy scheme lapse on omission of Section 3A, contrasted with the Punjab and Haryana High Court's view that omission of Section 3A does not wipe out accrued liability, aided by the saving provision in Section 38A inserted by Section 131 of the Finance Act, 2001.

Conclusion: The matter required reconsideration by a Division Bench in light of the conflicting views, and the papers were directed to be placed before the President for that purpose.

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