Appellate ruling on declared packing speed binds revenue authorities, making a parallel excise enquiry unsustainable.

An appellate authority had held that Rule 6(6) of the Pan Masala Packing Machines Rules, 2008 does not prohibit alteration of the declared maximum packing speed, provided the change is genuinely effected and physically verified. That ruling displaced the basis for a later enquiry and summons issued under the Central Excise Act, because subordinate revenue authorities were required to follow the appellate determination on both statutory interpretation and the relevant factual foundation. Continued investigation on the same core issue was therefore unsustainable, and reliance on Section 9AA was treated as misconceived. The enquiry and summons were quashed.

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Issues: Whether the enquiry and summons issued in relation to the packing machine could be continued after the appellate authority had held that the maximum packing speed could be changed without any pre-condition and had set aside the contrary departmental order.

Analysis: The petitioner's declaration of maximum packing speed had been approved earlier, a trial run had been conducted by the department, and the appellate authority later held that Rule 6(6) of the Pan Masala Packing Machines (Capacity Determination and Calculation of Duty) Rules, 2008 does not bar alteration of the declared maximum speed and does not require any explanation, provided the change is genuinely effected and physically verified. That finding directly affected the foundation of the later investigation under Section 11A of the Central Excise Act, 1944 and the summons issued under Section 14 of the Central Excise Act, 1944. In light of the principle that subordinate revenue authorities must follow appellate orders, continued enquiry on the same central issue could not be sustained, and reliance on Section 9AA of the Central Excise Act, 1944 was found misconceived.

Conclusion: The enquiry and summons were held unsustainable and were quashed.

Ratio Decidendi: When an appellate authority has conclusively ruled on the governing statutory interpretation and factual basis of assessment, subordinate revenue authorities are bound to follow that ruling and cannot continue a parallel enquiry on the same core issue in disregard of judicial discipline.

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