TaxTMI 
TaxTMI 
2026 (9) TMI 1755
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....rity for fresh examination and, also referred four questions for resolution by a Larger Bench. Paragraph 12 of that order, which carries both the reference and the questions, reads as under. "12. I have examined the legal issues involved in the impugned case law cited above in the context of the Act's, Rule's and law laid down by the Hon'ble Supreme Court and other Constitutional Courts/Tribunal. I have remanded the matter of the refund claim being barred by the limitation of time to be examined afresh. However, the issue of law requires to be settled from among conflicting viewpoints. I am hence constrained to refer the disagreement to the Hon'ble President for resolution, by the constitution of a Special / Larger Bench, on the following issues; (A) Whether under the facts and circumstances of the case section 51 read with Section 7 and 26 of the SEZ Act has an overriding effect over the levy imposed under sections 66, 66A and section 66B of Chapter V of the Finance Act, 1994 and hence the refund claim is not subject to any time limit? (B) Whether under the facts and circumstances of the case and in the light of rule 47(5) of 'The Special Economic Zones ....
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.... Tirunelveli,- 2021-VIL-106-CESTAT-CHE (e) Wabco India Ltd. v. Commissioner of GST and Central Excise, Chennai,- 2021 (54) GSTL 37 (Tri.-Chennai) and (f) Lanco Solar Pvt. Ltd. v. Commissioner of Central Tax, Raipur.- 2020 (4) TMI 77- CESTAT DELHI 4. It was further submitted that Paragraph 11.2 of the same order acknowledges that the issue arising in this appeal is similar to that stood decided in those cases, and further does not record any other Division Bench Final Order of this Tribunal that has rendered any contrary decision. 5. Ld. Counsel argued that the Single Member Bench did not entertain a doubt, but expressed a disagreement, and that a Bench of one Member possesses no power to disagree with a Bench of two. He relied on the decision of a Larger Bench of this Tribunal in Bank of America, National Association v. Principal Commissioner, CGST and Central Excise, (2025) 26 Centax 50 (Tri-LB),- (2025) 26 Centax 50 (Tri.-LB) in which it was held that judicial discipline and propriety require a Bench of two Members to follow the decision of a Larger Bench of three Members, even where the Bench of two Members considers the earlier decision inappropriate. Th....
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....ence arises upon a difference between Benches of unequal strength, the Bench constituted to resolve it must be of a strength coequal with the Bench whose decision has been doubted. The power of the President being untrammelled in that respect, he prayed that the reference be heard and answered on merits. Issues for determination 9. Having heard both sides on the preliminary objection, we are of the view that two questions arise for our determination, that is to say, (i) Whether a Bench of lesser strength may differ from, or doubt, the decision of a Bench of greater strength and seek a reference, and whether upon such a reference the President may constitute a Bench of strength greater than that of the Bench whose decision is doubted; and (ii) Whether the reference made through Interim Order No. 40006/2024 dated 07.11.2024 is a proper reference which this Bench ought to answer. Discussion and findings Stare decisis and the discipline of precedent 10. The answer to both questions is governed by the doctrine of stare decisis and by the discipline of precedent that flows from it. The expression comes from the Latin phrase meaning to stand by things decided. It obli....
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....w instead of referring the matter to a larger Bench. In such a case lawyers would not know how to advise their clients and all courts subordinate to the High Court would find themselves in an embarrassing position of having to choose between dissentient judgments of their own High Court." 13. The point arose again in Lala Shri Bhagwan v. Ram Chandra- AIR 1965 SC 1767 which speaks directly to the situation of a Bench of one hearing a matter already covered by a Bench of two. "18. ... It is hardly necessary to emphasize that considerations of judicial propriety and decorum require that if a learned Single Judge hearing a matter is inclined to take the view that the earlier decisions of the High Court, whether of a Division Bench or of a Single Judge, need to be reconsidered, he should not embark upon that enquiry sitting as a Single Judge, but should refer the matter to a Division Bench or, in a proper case, place the relevant papers before the Chief Justice to enable him to constitute a larger bench to examine the question. That is the proper and traditional way to deal with such matters and it is founded on healthy principles of judicial decorum and propriety. It is to ....
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....in judgment over, the discretion exercised or the judgment rendered in a cause or matter before another coordinate Bench. Again, in Coir Board, Ernakulam v. Indira Devi P.S.- 1998 (3) SCC 259 a Bench of two Judges doubted the correctness of the judgment of a Bench of seven Judges in Bangalore Water Supply and Sewerage Board v. A. Rajappa, 1978 (2) SCC 213, and directed the matter to be placed before the Chief Justice of India for the constitution of a larger Bench. A cognate principle was reiterated when a Bench of three Judges, headed by Dr. A.S. Anand, C.J, in Coir Board, Ernakulam, Kerala State v. Indira Devi P.S.- 2000 (1) SCC 224 declined to entertain the reference and held that the Bench of two Judges was bound by the judgment of the larger Bench. 18. In Dr. Vijay Laxmi Sadho v. Jagdish- 2001 (2) SCC 247 the Hon'ble Supreme Court considered whether a learned Single Judge of the High Court of Madhya Pradesh could ignore the judgment of a coordinate Bench on the same issue, and held as under. "33. As the learned Single Judge was not in agreement with the view expressed in Devilal case it would have been proper, to maintain judicial discipline, to refer the matter to....
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....ipline and propriety demand that a Bench of two learned Judges should follow the decision of a Bench of three learned Judges, that if the Bench of two learned Judges concludes that the earlier judgment is so incorrect that in no circumstances can it be followed, the proper course is to refer the matter to a Bench of three learned Judges while setting out the reasons for which it could not agree with the earlier judgment, and that only if the Bench of three learned Judges also comes to that conclusion is a reference to a Bench of five learned Judges justified. 21. The exception to this discipline is narrow and is confined to the doctrine of per incuriam. In State of Bihar v. Kalika Kuer- 2003 (5) SCC 448, the Hon'ble Supreme Court examined that doctrine at length and held that an earlier judgment of a larger Bench cannot be brushed aside by a smaller Bench by invoking the principle of per incuriam, the only course open to a coordinate or a smaller Bench being to request a reference to the larger Bench. The illustration ordinarily given of the exception, namely R. Thiruvirkolam v. Presiding Officer- AIR 1997 SC 633 does not detract from the discipline. There a Bench of two J....
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....re a Bench of larger quorum and that Bench itself feels that the view of the law taken by a Bench of lesser quorum, which view is in doubt, needs correction or reconsideration then by way of exception (and not as a rule) and for reasons given by it, it may proceed to hear the case and examine the correctness of the previous decision in question dispensing with the need of a specific reference or the order of the Chief Justice constituting the Bench and such listing. Such was the situation in Raghubir Singh & Ors. and Hansoli Devi & Ors. (supra)." 23. That the discipline binds equally where the criticism is directed at a Bench of the same court was underscored in State of U.P. v. Jeet S. Bisht - 2007 (6) SCC 586. One of the learned Judges constituting the Bench having criticised orders passed by other Benches in the same case, the other learned Judge expressed himself as under. "100. For the views been taken herein, I regret to express my inability to agree with Brother Katju, J. in regard to the criticisms of various orders passed in this case itself by other Benches. I am of the opinion that it is wholly inappropriate to do so. One Bench of this Court, it is trite, doe....
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....pressed in a minority opinion, is no wider than the per incuriam exception already noticed in Kalika Kuer, and is of no assistance where the smaller Bench identifies no violation, no patent error and no erroneous approach at all. 27. The position was put beyond debate by a Bench of seven Judges in Aligarh Muslim University v. Naresh Agarwal.- 2024 INSC 856 After noticing the principles summarised in Central Board of Dawoodi Bohra Community in paragraph 37 of its judgment, the Court held as under. "38. The position of law laid down in Central Board of Dawoodi Bohra Community (supra) is correct. Decisions of a larger Bench are binding precedent, and judicial discipline and propriety dictate that Benches of lower strength must adhere to such decisions. This will also avoid inconsistencies in the development of law. Questions concerning the correctness of judgments must ordinarily be referred only by a Bench which is equal in strength to the Bench whose judgment is doubted. We also agree with the two exceptions to this rule, as detailed by this Court in Central Board of Dawoodi Bohra Community (supra). They must remain exceptions and not transmogrify into the rule its....
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....enches of the Tribunal on the very same issue, cannot be countenanced. As such, we hold that the very reference made to the third member to adjudicate an issue, which was already set at naught by the coordinate benches of the Tribunal, is unnecessary." 30. Two further decisions bearing directly upon the working of this Tribunal need to be noticed. In Mercedes Benz India Pvt. Ltd. v. Union of India- 2010 (252) E.L.T. 168 (Bom.) the High Court of Bombay held that judicial discipline requires a reference to a Larger Bench where there is a difference in views between Benches on identical facts, and observed that one coordinate Bench finding fault with another is not a healthy way of dealing with matters. In Fujifilm India Pvt. Ltd. v. Commissioner of Customs (Import), Nhava Sheva- 2017 (349) E.L.T. 203 (S.C.) the Hon'ble Supreme Court reiterated that a Bench of the Tribunal differing with a coordinate Bench must refer the matter to a Larger Bench and may not decide the issue for itself. To these may be added the admonition of a Bench of three Judges in Union of India v. Kamalakshi Finance Corporation Ltd.- 1991 (55) E.L.T. 433 (S.C.) that the principles of judicial discipline requir....
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....r the Central Excise Act, 1944. Section 35D of the Central Excise Act, 1944 in turn provides that the provisions of sub sections (1), (2), (5) and (6) of section 129C of the Customs Act, 1962 shall apply to the Appellate Tribunal in the discharge of its functions under that Act as they apply in the discharge of its functions under the Customs Act, 1962. The chain of incorporation is therefore complete, and sub sections (1) and (5) of section 129C govern the constitution of Benches of this Tribunal in a service tax appeal as much as in a customs appeal. Sub section (1) declares that the powers and functions of the Appellate Tribunal may be exercised and discharged by Benches constituted by the President from amongst the Members thereof. 33. The width of that power was settled in Union of India v. Paras Laminates (P) Ltd.- 1990 (4) SCC 453 : 1990 (49) ELT 322 (SC) This Tribunal, in Commissioner of Central Excise v. Asia Brown Boveri Ltd.- 2000 (120) ELT (228) (Tri-LB) considered both the competence of one Bench of the Tribunal to differ from the view taken by another Bench and the power of the President to constitute a Larger Bench, and held as under. "6. On a considerati....
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....orum larger than that of the Bench whose decision is doubted, and that the President of this Tribunal, being the master of the roster, has wide inherent power under sub section (5) of section 129C of the Customs Act, 1962 to direct any particular matter to be placed for hearing before any particular Bench of any strength. That sub section, which deals with a difference of opinion arising among the Members of a Bench, empowers the President to act upon a reference made in that circumstance, and the power so conferred is wide enough to meet the case of a Member who finds himself unable to decide a case according to what he perceives to be the correct law. Neither expressly nor by implication does the provision curtail that power by making the strength of the referring Bench, or the strength of the Bench whose decision has been doubted, a criterion for the constitution of the Larger Bench. 35. Applying these principles, the first issue is answered compositely. A Bench of lesser strength cannot differ from, dissent from, or overrule the decision of a Bench of greater strength. It may, however, entertain a doubt, and having entertained it, the only course open to it is to record the ....
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....raph 11.2 records that the issue in the present appeal is similar, and does not record any decision of a division bench of this Tribunal taking a contrary view. A reference to a Larger Bench is the machinery provided for the resolution of a conflict of judicial opinion or for the reconsideration of a view whose correctness is genuinely in doubt. It is not machinery for the registration of a dissent by a Bench that has no power to dissent. Where the law has been declared uniformly by six coordinate Benches, including that of superior strength, and nothing contrary is shown, the duty of the Single Member Bench was to follow it. Mercedes Benz India and Fujifilm India leave no room for any other course. 39. The second reason lies in the language of the Interim Order, which is the language of disagreement and not of doubt. The operative sentence records that the Member was constrained to refer the disagreement for resolution. Aligarh Muslim University, following Central Board of Dawoodi Bohra Community, permits a Bench of lower strength to doubt without disagreeing, and no further. To disagree with six earlier decisions of the Tribunal, including that of Division Benches, sitting sin....
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....assessments of an entire class of assessees. The appellant, a unit in a Special Economic Zone, came to this Tribunal in the year 2020 with six decisions including that of Division Benches in its favour on the identical question, and with nothing whatsoever the other way. One of those six, Wabco India Ltd. v. Commissioner of GST and Central Excise, Chennai, was rendered in the case of this very appellant, the name of Wabco India Limited having been changed to ZF Commercial Vehicle Control Systems India Limited in the year 2022. A decision of a Bench of this Tribunal in the appellant's own case, upon the same question and against the Revenue, therefore stood squarely in the path of the reference. To differ from it was to withhold from the appellant the benefit of a judgment it had already secured, and to require it to establish the same proposition over again. It is difficult to conceive of a case in which adherence to precedent was more plainly called for. The appellant has instead been drawn into a reference it never invited, which has occupied this Tribunal for close to six years and has left it, at the end of that period, before a departmental adjudicating authority once again. W....