Tribunal upholds President's power to constitute Special Bench, allows appeals on Customs Act orders

The Tribunal rejected the Revenue's preliminary objection on the constitution of a five-member Special Bench, affirming the President's wide powers to direct matters before any Bench. Regarding the maintainability of appeals against orders under Section 110A of the Customs Act, the Tribunal held that such orders are adjudicatory in nature, appealable under Section 129A. It concluded that appeals against orders by the Commissioner under Section 110A are permissible, directing the Division Bench to decide the appeals on their merits.

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Issues Involved:
1. Preliminary Objection of Revenue on the Constitution of a Five-Member Special Bench
2. Maintainability of Appeal Against Orders Under Section 110A of the Customs Act, 1962

Detailed Analysis:

Preliminary Objection of Revenue on the Constitution of a Five-Member Special Bench:
The Revenue raised a preliminary objection on three points regarding the validity of constituting a five-member Special Bench to hear the issue:
1. Correctness of Larger Bench Order: It was argued that the correctness of the Larger Bench order in Akanksha should have been considered by a Bench of co-equal strength only.
2. Legislative Intent Under Section 129C (5): The legislative intent as per Section 129C (5) is for the President to refer to "other members" including those who first heard it.
3. Consideration of Arguments: The reference by the Division Bench was made without considering all arguments made by Revenue.

The Tribunal examined precedents, including the Apex Court's decisions in Pradip Chandra Parija vs. Pramod Chandra Patnaik and Central Board of Dawoodi Bohra Community vs. State of Maharashtra, which established that a Bench of lesser quorum cannot doubt the correctness of a larger quorum's view. However, the Supreme Court also recognized the Chief Justice's discretion to direct any matter to be placed before any particular Bench. The Tribunal found no merit in the Revenue's preliminary objection, stating that the President, as the head of CESTAT, has wide powers to direct matters to be placed before any Bench. The objection was thus rejected.

Maintainability of Appeal Against Orders Under Section 110A of the Customs Act, 1962:
The main issue was whether an appeal lies before the Tribunal against an order passed by the Commissioner under Section 110A for the provisional release of seized goods. The appellants argued that the Tribunal has powers under Section 129A to deal with appeals against such orders, citing various High Court decisions supporting this view.

The Tribunal analyzed the nature of orders under Section 110A, determining that:
1. Nature of Order: Orders under Section 110A are issued by adjudicating authorities and have legal consequences. They are not merely administrative or interim but are adjudicatory in nature.
2. Statutory Provisions: Section 129A (1) (a) allows appeals against decisions or orders passed by the Principal Commissioner or Commissioner of Customs as adjudicating authorities. Since orders under Section 110A are issued by adjudicating authorities, they fall within the scope of Section 129A.
3. Judicial Precedents: Various High Courts, including Delhi and Rajasthan, have held that orders under Section 110A are appealable under Section 129A. The Tribunal also noted that there is no higher court decision stating that such orders are not appealable.

The Tribunal concluded that:
1. Administrative or Interim Nature: The contention that an order under Section 110A is administrative or interim is misconceived.
2. Scope of Section 129A: Provisions of Section 129A (1) (a) clearly authorize an appeal against an order or decision by the Adjudicating Authority under Section 110A. There is no legal basis to restrict the scope of such appeals.

Conclusion:
The Tribunal answered the reference affirmatively, stating that an appeal lies before the Tribunal against an order passed by the Commissioner of Customs under Section 110A for the provisional release of goods. The records were transmitted to the Division Bench to decide the appeals on merits, in line with the conclusions regarding the maintainability of the appeal.

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