Unchallenged appellate classification order binds excise authorities and bars a contrary show cause notice.

An unchallenged appellate classification order granting exemption on flavouring agents bound subordinate excise authorities until it was reversed or set aside. Because the Appellate Collector had decided the dispute after an opportunity for sampling and chemical report, the Superintendent of Central Excise could not ignore that subsisting determination and issue fresh letters or a contrary show cause notice on the basis that the order was wrong. The impugned communications were therefore quashed, and the petitioners succeeded.

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Issues: Whether an order passed by the Appellate Collector of Central Excise, holding the petitioners' flavouring agents entitled to exemption, bound the excise authorities so as to preclude them from issuing fresh letters and a show cause notice taking a contrary view.

Analysis: The Appellate Collector had the opportunity to obtain samples and call for a chemical report before deciding the classification dispute, but he nevertheless granted the exemption. The excise authorities did not challenge that appellate order by revision or otherwise. In these circumstances, the appellate finding operated as binding on the subordinate excise authorities. A Superintendent of Central Excise could not disregard that order on the premise that it was wrong or founded on an incorrect assumption and proceed on a contrary classification.

Conclusion: The impugned letters and show cause notice were unsustainable and were quashed. The issue was decided in favour of the petitioners.

Final Conclusion: The petition succeeded because the excise authorities were not entitled to ignore the subsisting appellate determination on classification and exemption.

Ratio Decidendi: An unchallenged appellate order on classification binds the subordinate excise authorities until it is reversed or set aside, and they cannot unilaterally disregard it by taking a contrary administrative view.

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