2009 (5) TMI 244 - AT - Central Excise

Lower authorities proceeded to decide the issue ignoring Tribunal s directions - the Commissioner (Appeals) rather than analysing the evidence in the form of the expert opinion, disposed of the appeal solely on the basis of the opinion expressed by the Assistant Commissioner in spite of the fact that such opinion was based on purely visual inspection of the goods by the Assistant Commissioner. - Once the Tribunal had cautioned the lower authorities that the classification was required to be done after taking into consideration the opinion of the experts and on going through the necessary literature in relation to the goods produced by the appellant, we fail to understand as to how the lower authorities could totally ignore the order of the Tribunal and proceed to decide the matter contrary to the directions issued by the Tribunal. It should not be forgotten that proceedings before the lower authority were of the quasi-judicial nature and therefore, the authorities had to observe the judicial discipline. Once the higher authority directs the lower authority to decide a matter by taking into consideration certain materials on record, the lower authority cannot decide the same totally ignoring such direction and cannot adopt totally different course. matter remanded

Summary

Issues: Challenge to orders ignoring tribunal directions and exceeding scope of show cause notice.

Analysis:
1. The appellants contested the orders passed by the Commissioner (Appeals) and the Assistant Commissioner on two grounds. Firstly, they argued that the authorities disregarded specific directions from the Tribunal given in a previous appeal. Secondly, they claimed that the authorities went beyond the scope of the show cause notice issued to them.

2. The show cause notice dated 8-9-92 raised concerns about the classification of products manufactured by the appellants, which included parts of locomotive railways and motor vehicles. Initially classified under sub-heading 8607.00, an addendum later sought to classify them under sub-heading 8531.00. Despite the appellants' contentions, the adjudicating authority confirmed the demand in line with the addendum. The Tribunal, in a previous order, remanded the matter for reconsideration, emphasizing the need for technical literature to determine whether the items were electro mechanical appliances or equipments excluded from Chapter 85.

3. Following the remand, the Assistant Commissioner confirmed the previous order, leading to the appellants' appeal before the Commissioner (Appeals). The Commissioner upheld the Assistant Commissioner's decision, prompting the present appeal. The learned D.R. argued that the authorities correctly classified the products as electrical goods under Chapter 85, warranting no interference with the impugned orders.

4. The Tribunal's remand order directed the appellants to provide further evidence, particularly technical literature, to aid in classification. Despite submitting certificates from experts confirming the nature of the items, the Assistant Commissioner failed to consider this crucial evidence. The Commissioner (Appeals) also overlooked the expert opinion, relying solely on the Assistant Commissioner's visual inspection report, contrary to the Tribunal's directive to consider expert opinions and technical literature.

5. The Tribunal emphasized that lower authorities must adhere to its directions, especially in quasi-judicial proceedings, maintaining judicial discipline. Ignoring the Tribunal's order and proceeding contrary to its directions was deemed unacceptable. Consequently, the appeal succeeded on the grounds of authorities disregarding the Tribunal's directives, leading to the setting aside of the lower authorities' orders for reconsideration based on existing evidence and the Tribunal's observations within three months.

6. The judgment highlights the importance of following tribunal directives in quasi-judicial proceedings, emphasizing the need for lower authorities to consider expert opinions and technical literature in classification matters. The failure to adhere to such directives can lead to orders being set aside for reconsideration based on the evidence available and the tribunal's guidance.