2006 (10) TMI 220 - HC - Customs

Difference of opinion- At time of passing majority order after decision by third member, two members who originally passed orders retired. Submission that entire matter to be heard de novo. Single judge held that the circumstances that the third member, to whom the matter was referred, happened to form part of two member bench which passed the majority order, cannot change the fact that bench which pronounced order based on majority opinion is successor bench. Court hence held that there was no necessity for Member (J), who formed part of two member Bench, to hear matter. No reason to interfere with view taken by single judge.

Summary

Issues:
1. Clubbing of units for differential duty and penalty
2. Interpretation of Section 129C(5) of the Customs Act

Analysis:
1. The judgment concerns a partnership firm where three units were clubbed together by the respondents, alleging two of them to be dummy units. A common show cause notice was issued to demand differential duty and penalty. The appellant contended that there was no evidence to support the clubbing of units as managed by one entity. The matter was heard by a Bench where the Vice-President and Judicial Member differed on the issue. Subsequently, a third Member (Taxation) supported one opinion and differed from the other. The decision was then made based on the majority opinion, and orders were pronounced by a two-Member Bench. The appellant argued that as the original Bench members who delivered differing judgments were no longer available, the matter should be heard de novo under Section 129C(5) of the Customs Act.

2. The learned single Judge referred to previous legal precedents and held that the decision made by the successor Bench, comprising the Member (Taxation) and another Member (Judicial), based on the majority opinion, was valid. The Judge emphasized that it was not necessary for the matter to be reheard by a different Bench solely because the original members who disagreed were no longer available. The judgment highlighted that the successor Bench would pronounce the final decision according to the majority opinion of the Judges who heard the case, including those who were part of the original hearing. This interpretation was supported by citing relevant judgments from different High Courts.

In conclusion, the High Court upheld the decision of the learned single Judge, dismissing the writ appeal and closing the related motion. The judgment affirmed the validity of the decision made by the successor Bench based on the majority opinion, in accordance with the provisions of Section 129C(5) of the Customs Act and established legal principles.