Factual distinguishability limits precedent where common input treatment differed between dutiable output and exempt by-product

The Larger Bench ruling in Rallis India Ltd. was held not to govern the dispute because the material facts differed. Copper concentrate was the common raw material from which copper anodes emerged as the dutiable final product and sulphuric acid emerged as a by-product cleared without duty, but the earlier case involved a different input structure and treatment of the exempt and dutiable goods. On that basis, the earlier decision was treated as factually distinguishable and not a binding precedent on the present facts, with the first referred question answered in favour of the assessee.

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Issues: Whether the Larger Bench decision in Rallis India Ltd. could be followed as binding precedent on the facts of the present case.

Analysis: The question turned on whether the input commonality and the nature of the goods were materially the same as in the earlier Larger Bench decision. The process showed that copper concentrate was the common raw material from which copper anodes emerged as the dutiable final product and sulphuric acid emerged as the by-product cleared without duty. The earlier decision involved a different factual setting in which the input considered there was not treated as a common input for the dutiable final product and the exempt goods in the same manner. On that basis, the earlier ruling was held to be factually distinguishable and not a binding precedent for the present dispute.

Conclusion: The first referred question was answered in favour of the assessee; the Larger Bench decision in Rallis India Ltd. was not treated as binding precedent on the present facts.

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