Consequential duty demand can be challenged when stenter capacity was fixed by wrongly including gallery length.

A consequential duty demand based on an annual capacity fixation that wrongly included the length of galleries in a stenter could still be challenged, because binding precedent had already settled that galleries are not to be counted. The absence of a separate appeal against the original capacity-fixation order did not bar the assessee from contesting the downstream demand. The objection that the foundational order had attained finality was rejected, since a demand founded on an incorrect legal basis remains open to challenge in consequential proceedings.

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Issues: Whether the assessee could challenge the consequential duty demand on the ground that the length of galleries was wrongly taken into account while fixing the annual capacity of the stenter, even though the original capacity-fixation order had not been separately challenged.

Analysis: The issue was treated as settled by binding precedent holding that the length of galleries is not to be included while determining the capacity of a stenter. On that basis, the demand founded on such determination could be questioned in consequential proceedings, and the absence of a separate challenge to the original fixation order did not prevent the assessee from contesting the demand.

Conclusion: The assessee was entitled to challenge the consequential demand, and the objection based on failure to appeal against the original capacity-fixation order was rejected.

Ratio Decidendi: Where the foundational capacity determination is contrary to the settled legal position, a consequential demand based on that determination can still be assailed notwithstanding that the original fixation order was not separately challenged.

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