Ajanta Manufacturing Private Limited V. Union of India

SCA/3318/2021

AI Insights

The case involves two petitions filed by Ajanta Manufacturing Private Limited against the Union of India, challenging the legality and validity of show cause notices issued by the respondent authorities. The petitions were based on the grounds that the notices were issued without jurisdiction and authority of law, and in clear disregard to the binding order of a superior authority, amounting to an abuse of the process of law. The court examined the history of litigation and the decisions of various authorities, including the Central Excise & Service Tax Appellate Tribunal (CESTAT) and the Commissioner (Appeals), which had previously allowed the refund claims. The court found that the show cause notices were an attempt to reopen issues that had already been settled, thus violating the principles of res judicata and judicial discipline.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 802355 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 14-10-2021
• Assessment Year: misc
• Other Referred Cases: Union Of India Versus Kamlakshi Finance Corporation Ltd, Commissioner Of Central Excise, Kanpur Versus Kothari Products Ltd., Commissioner Of Customs, New Delhi Versus Texcomash Export, Union Of India Versus Vicco Laboratories, Claris Lifesciences Ltd. Versus Union Of India, Lubi Industries Llp Versus Union Of India, Commissioner Of Customs Versus Millat Fibers, Lupin Limited Versus Union Of India, Hope Plantataions vs. Taluka Land Board, Union of India vs. Madras Telephone, Pradeep Kumar Maskara vs. State of WB, Subramaniam Swamy vs. State of TN
• Laws Referred To: Constitution of India, Central Excise Tariff Act, 1985, Finance Act, 2004, Finance Act, 2007
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: DEVANG VYAS; PY DIVYESHVAR
• Assessee Lawyers: AMRITA THAKORE
• Keywords: Binding precedent; Education Cess; Jurisdiction; Refund claim; Secondary Higher Education Cess; Show cause notice
• Section: 92; 91; 226; 93

Judgement Text

"C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 3320 of 2021 With R/SPECIAL CIVIL APPLICATION NO. 3318 of 2021 FOR APPROVAL AND SIGNATURE: HONOURABLE MS. JUSTICE SONIA GOKANI and HONOURABLE MR. JUSTICE RAJENDRA M. SAREEN ========================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? YES 2 To be referred to the Reporter or not ? YES 3 Whether their Lordships wish to see the fair copy of the judgment ? NO 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ? NO ========================================================== AJANTA MANUFACTURING PRIVATE LIMITED Versus UNION OF INDIA ========================================================== Appearance: MS AMRITA M THAKORE(3208) for the Petitioner(s) No. 1,2 MR DEVANG VYAS(2794) for the Respondent(s) No. 1 MR PY DIVYESHVAR(2482) for the Respondent(s) No. 2 ========================================================== CORAM: HONOURABLE MS. JUSTICE SONIA GOKANI and HONOURABLE MR. JUSTICE RAJENDRA M. SAREEN Date : 14/10/2021 ORAL JUDGMENT (PER : HONOURABLE MS. JUSTICE SONIA GOKANI) 1 . T h e s e a r e t w o p e t i t i o n s p r e f e r r e d u n d e r Page 1 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 A r t i c l e 2 2 6 o f t h e C o n s t i t u t i o n o f I n d i a c h a l l e n g i n g t h e l e g a l i t y a n d v a l i d i t y o f t h e s h o w c a u s e n o t i c e s i s s u e d b y t h e r e s p o n d e n t a u t h o r i t i e s o n t h e g r o u n d t h a t t h e s a i d s h o w c a u s e n o t i c e i s e x f a c i e w i t h o u t j u r i s d i c t i o n a n d a u t h o r i t y o f l a w a n d i n c l e a r d i s r e g a r d t o t h e b i n d i n g o r d e r o f t h e s u p e r i o r a u t h o r i t y a m o u n t i n g t o a b u s e o f p r o c e s s o f l a w , i l l e g a l a n d v o i d . 2 . B o t h t h e s e p e t i t i o n s , s i n c e , i n v o l v e i d e n t i c a l q u e s t i o n o f l a w , t h e y a r e b e i n g d e c i d e d b y t h i s c o m m o n j u d g m e n t w h e r e n e c e s s a r y , f a c t s f o r a d j u d i c a t i o n a r e d r a w n f r o m S p e c i a l C i v i l A p p l i c a t i o n N o . 3 3 2 0 o f 2 0 2 1 . 2 . 1T h e p e t i t i o n e r N o . 1 i s a c o m p a n y i n c o r p o r a t e d a n d r e g i s t e r e d u n d e r t h e Page 2 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 C o m p a n i e s A c t a n d t h e p e t i t i o n e r c l a i m s t o b e o n e o f t h e l a r g e r m a n u f a c t u r i n g p l a n t s a t K u t c h c h , D i s t r i c t G u j a r a t . I t m a n u f a c t u r e s t h e e x c i s a b l e p r o d u c t s s u c h a s E l e c t r i c E n e r g y S a v i n g L a m p , V i t r i f i e d T i l e s , Q u a r t z C l o c k , e t c . f a l l i n g u n d e r C h a p t e r 6 9 , 8 5 a n d 9 1 o f t h e C e n t r a l E x c i s e T a r i f f A c t , 1 9 8 5 . T h e p e t i t i o n e r N O . 2 i s a s h a r e h o l d e r a n d D i r e c t o r o f t h e p e t i t i o n e r N o . 1 - C o m p a n y . 2 . 2 M a s s i v e e a r t h q u a k e i n t h e S t a t e o f G u j a r a t a n d p a r t i c u l a r l y , i n t h e D i s t r i c t o f K u t c h i n t h e y e a r 2 0 0 1 l e d t h e C e n t r a l G o v e r n m e n t t o i s s u e t h e N o t i f i c a t i o n N o . 3 9 / 2 0 0 1 - C E d a t e d 3 1 . 0 7 . 2 0 0 1 g r a n t i n g e x e m p t i o n t o e x c i s a b l e g o o d s o t h e r t h a n t h o s e s p e c i f i e d i n t h e N o t i f i c a t i o n , c l e a r e d f r o m u n i t s i n K u t c h . T h e s a i d Page 3 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 N o t i f i c a t i o n w a s a m e n d e d f r o m t i m e t o t i m e a n d t h e p e t i t i o n e r ’ s u n i t s i n c e i s l o c a t e d i n t h e D i s t r i c t K u t c h , i t a v a i l e d t h e b e n e f i t s o f t h e s a i d N o t i f i c a t i o n . 2 . 3 T h e p e t i t i o n e r h a d f i l e d r e f u n d c l a i m s p u r s u a n t t o t h e a m e n d m e n t i n t h e s a i d N o t i f i c a t i o n i n r e s p e c t o f C e n t r a l E x c i s e D u t y , E d u c a t i o n C e s s a n d S e c o n d a r y & H i g h e r S e c o n d a r y E d u c a t i o n C e s s ( ‘ E C S H E C ’ h e r e i n a f t e r ) f o r t h e p e r i o d f r o m J u n e 2 0 0 7 t o M a r c h 2 0 0 8 . I t w a s p a r t i a l l y s a n c t i o n e d b y t h e A s s i s t a n t C o m m i s s i o n e r , B h u j , b u t r e j e c t e d t h e p a r t o f t h e c l a i m i n c l u d i n g t h e c l a i m i n r e s p e c t o f E C S H E C . 2 . 4 T h e p e t i t i o n e r N o . 2 c h a l l e n g e d t h e s a i d o r d e r b y w a y o f a p p e a l s b e f o r e t h e C o m m i s s i o n e r ( A p p e a l s ) , v i d e o r d e r s d a t e d Page 4 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 7 . 0 3 . 2 0 0 8 a n d 2 7 . 0 6 . 2 0 0 8 w h i c h u p h e l d t h e r e f u n d o r d e r s p a s s e d b y t h e A s s i s t a n t C o m m i s s i o n e r , B h u j . 2 . 5 A g g r i e v e d p e t i t i o n e r s p r e f e r r e d a p p e a l s b e f o r e t h e C e n t r a l E x c i s e a n d S e r v i c e T a x A p p e l l a t e T r i b u n a l ( ‘ t h e C E S T A T ’ h e r e i n a f t e r ) , A h m e d a b a d , w h i c h r e m a n d e d t h e m a t t e r s v i d e i t s o r d e r s d a t e d 1 0 . 8 . 2 0 0 9 a n d 9 . 1 1 . 2 0 0 9 t o t h e a d j u d i c a t i n g a u t h o r i t y . 2 . 6 O n 1 0 . 6 . 2 0 1 0 , t h e a d j u d i c a t i n g a u t h o r i t y s a n c t i o n e d c e r t a i n r e f u n d c l a i m s , h o w e v e r , i t c h o s e n o t t o s a n c t i o n t h e r e f u n d c l a i m s o f R s . 5 4 , 1 0 , 8 1 0 / - p e r t a i n i n g t o E C S H E C o n t h e g r o u n d o f t h e e x e m p t i o n u n d e r t h e s a i d N o t i f i c a t i o n N o . 3 9 / 2 0 0 1 - C E w i t h a r e a s o n i n g t h a t o n l y C e n t r a l E x c i s e Page 5 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 D u t y o r A d d i t i o n a l C e n t r a l E x c i s e D u t y c a n b e e x e m p t e d a n d t h e s a i d N o t i f i c a t i o n d i d n o t c o v e r t h e E C S H E C . 2 . 7 A g g r i e v e d b y t h e s a i d r e f u n d o r d e r d a t e d 1 0 . 6 . 2 0 1 0 , t h e p e t i t i o n e r s f i l e d a p p e a l b e f o r e t h e C o m m i s s i o n e r ( A p p e a l s ) , R a j k o t o n v a r i o u s g r o u n d s i n c l u d i n g o n t h e g r o u n d t h a t E d u c a t i o n C e s s i s a n e x c i s e d u t y a n d i s t h e r e f o r e r e f u n d a b l e u n d e r N o t i f i c a t i o n N o . 3 9 / 2 0 0 1 - C E a s a l l “ d u t y l e v i a b l e u n d e r t h e A c t ” i s r e f u n d a b l e u n d e r t h e s a i d N o t i f i c a t i o n . 2 . 8 T h e C o m m i s s i o n e r ( A p p e a l s ) , w i t h a d e t a i l e d o r d e r d a t e d 1 9 . 1 2 . 2 0 1 8 , a l l o w e d t h e p e t i t i o n e r ’ s r e f u n d c l a i m o f R s . 5 4 , 1 0 , 8 1 0 / - p e r t a i n i n g t o E C S H S E C . W h i l e s o d o i n g , i t h e l d t h a t t h e s e a r e i n n a t u r e o f Page 6 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 a s u r c h a r g e l e v i e d a s d u t y o f e x c i s e a n d a l l p r o v i s i o n s o f t h e C e n t r a l E x c i s e A c t , 1 9 4 4 , i n c l u d i n g t h o s e r e l a t i n g t o e x e m p t i o n s a n d r e f u n d s w e r e m a d e a p p l i c a b l e t o t h i s l e v y a n d t h e N o t i f i c a t i o n N o . 3 9 / 2 0 0 1 h a d g r a n t e d 1 0 0 % e x e m p t i o n f r o m l e v y o f e x c i s e d u t y b y w a y o f r e f u n d / r e c r e d i t o f e x c i s e d u t y a n d E C S H S E C w e r e l e v i e d o n e x c i s e d u t y a n d w h e n t h e e x c i s e d u t y i t s e l f i s u n d e r e x e m p t i o n , t h e r e w o u l d b e n o q u e s t i o n o f l e v y o f a n y s u r c h a r g e o r c e s s b y w h a t e v e r n a m e i t i s c a l l e d . I t d e p e n d e d o n a C i r c u l a r d a t e d 1 0 . 8 . 2 0 0 4 o f t h e C e n t r a l B o a r d o f E x c i s e a n d C u s t o m s ( ‘ t h e C B E C ’ h e r e i n a f t e r ) . I t a l s o r e l i e d o n t h e d e c i s i o n o f t h e A p e x C o u r t r e n d e r e d i n c a s e o f S R D N u t r i e n t s P v t L t d v s . C C E , G u w a h a t i , r e p o r t e d i n 2 0 1 7 ( 3 5 5 ) E L T ( S C ) . Page 7 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 2 . 9 T h e p e t i t i o n e r s h a v e p r e f e r r e d a n a p p e a l b e f o r e t h e C E S T A T , A h m e d a b a d , c h a l l e n g i n g t h e o r d e r o f C o m m i s s i o n e r ( A p p e a l s ) t o t h e e x t e n t t h a t h e h a s r e j e c t e d t h e r e f u n d c l a i m . T h e d e p a r t m e n t h a s n o t p r e f e r r e d a n y a p p e a l a n d h a s a c c e p t e d t h e o r d e r o f C o m m i s s i o n e r ( A p p e a l s ) . 2 . 1 0 T h e p e t i t i o n e r s , t h e r e f o r e , f i l e d r e f u n d a p p l i c a t i o n i n t h e o f f i c e o f t h e r e s p o n d e n t N o . 2 s e e k i n g r e f u n d o f s u m o f R s . 5 4 , 1 0 , 8 1 0 / - b e i n g t h e a m o u n t o f E C S H S E C f r o m J u n e 2 0 0 7 t o M a r c h 2 0 0 8 . 2 . 1 1 O n a s c e r t a i n i n g t h e s t a t u s o f t h e o r d e r d a t e d 1 9 . 1 2 . 2 0 1 8 p a s s e d b y t h e C o m m i s s i o n e r ( A p p e a l s ) , t h e e x c i s e d e p a r t m e n t , c l e a r e d b y w a y o f p r e - a u d i t o f Page 8 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 t h e d e p a r t m e n t , r e f u n d c l a i m a n d t h i s h a d b e e n a l s o r e f l e c t e d i n a s u b s e q u e n t r e f u n d o r d e r d a t e d 0 1 . 0 4 . 2 0 1 9 p a s s e d b y t h e r e s p o n d e n t N o . 2 . 2 . 1 2 A f t e r a b o u t o n e a n d h a l f y e a r s , r e s p o n d e n t N o . 2 i s s u e d a s h o w c a u s e n o t i c e d a t e d 0 8 . 1 0 . 2 0 2 0 u p o n t h e p e t i t i o n e r s p r o p o s i n g t o r e c o v e r t h e a m o u n t o f R s . 5 4 , 1 0 , 8 1 0 / - w h i c h w a s r e f u n d e d t o t h e p e t i t i o n e r i n r e s p e c t o f E C S H S E C a l o n g w i t h i n t e r e s t . T h e o n l y b a s i s a c c o r d i n g t o t h e p e t i t i o n e r s , f o r i s s u a n c e o f s u c h s h o w c a u s e n o t i c e i s t h a t t h e N o t i f i c a t i o n N o . 3 9 / 2 0 0 1 a s a m e n d e d p r o v i d e s o n l y f o r e x e m p t i o n o f d u t i e s o f e x c i s e a n d a d d i t i o n a l d u t i e s o f e x c i s e a n d t h e r e f o r e , E C S H S E C i s l e v i e d b y t h e G o v e r n m e n t u n d e r t h e r e l e v a n t F i n a n c e A c t s , a n d t h e s a m e Page 9 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 w o u l d n o t b e c o v e r e d b y t h e s a i d N o t i f i c a t i o n . I t a l s o s o u g h t t o r e l y u p o n t h e d e c i s i o n o f t h e A p e x C o u r t r e n d e r e d i n c a s e o f U n i c o r n I n d u s t r i e s v s . U n i o n o f I n d i a , r e p o r t e d i n 2 0 1 9 ( 3 7 0 ) E L T 3 ( S C ) d e l i v e r e d o n 0 6 . 1 2 . 2 0 1 9 . I t p r o p o s e s i n v i e w o f t h e s u b s e q u e n t j u d g m e n t o f t h e A p e x C o u r t , r e c o v e r y o f t h e r e f u n d w h i c h h a s b e e n r e c e i v e d b y t h e p e t i t i o n e r . T h e d a t e o f h e a r i n g h a d a l r e a d y g o n e a s t h e n o t i c e w a s r e c e i v e d o n 1 2 . 0 1 . 2 0 2 1 a n d t h e d a t e o f h e a r i n g w a s f i x e d o n 0 1 . 0 1 . 2 0 2 1 . 2 . 1 3 B e c a u s e o f t h e p a n d e m i c , t h e p e t i t i o n e r N o . 2 , b e i n g a s e n i o r c i t i z e n , w a s n o t a t t e n d i n g o f f i c e r e g u l a r l y . H e a d d r e s s e d a l e t t e r s e e k i n g a m o n t h ’ s t i m e a n d h a s p r e f e r r e d t h e p e t i t i o n s . A c c o r d i n g t o t h e p e t i t i o n e r N o . 2 , i t i s a n a b u s e o f Page 10 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 p r o c e s s o f l a w b y t h e j u n i o r o f f i c e r , w h o h a s n o r e g a r d s f o r h i s s u p e r i o r ’ s d e c i s i o n . B i n d i n g o r d e r o f a s u p e r i o r q u a s i - j u d i c i a l a u t h o r i t y c a n n o t b e q u e s t i o n e d b y t h e r e s p o n d e n t N o . 2 i n a c o m p l e t e a r b i t r a r y a n d u n r e a s o n a b l e m a n n e r . I t i s a l s o u n s u s t a i n a b l e u n d e r t h e l a w , t h e r e f o r e , t h e f o l l o w i n g p r a y e r s : “18…. A. This Hon'ble Court be pleased to issue a writ of or in the nature of mandamus or a writ of or in the nature of prohibition or a writ of or in the nature of certiorari or any other appropriate writ, order or direction quashing and setting aside the show cause notice bearing no.IV/9- 11/SCN/Ajanta/Anjar-Bhachau/20-21 20201064WX00004X7A78) dated 8.10.2020 issued by the respondent no. 2 at Annexure E hereto. B. Pending admission, hearing and final disposal of this petition, your Lordships be pleased to stay and suspend the operation and implementation of the show cause notice bearing no. IV/9-11/SCN/Ajanta/Anjar Bhachau/20-21 (DIN: 20201064WX00004X7A78) dated 8.10.2020 issued by the Page 11 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 respondent no. 2 at Annexure E hereto and be further pleased to restrain the respondent no. 3 from proceeding further in any manner in regard to the adjudication or recovery of the demands raised by way of the said show cause notice. C. Ex parte ad interim relief in terms of prayer B above be granted. D. Such other and further reliefs as deemed just and expedient be granted.” 3 . T h i s C o u r t w h i l e i s s u i n g t h e n o t i c e o n 2 3 . 0 2 . 2 0 2 1 p a s s e d t h e f o l l o w i n g o r d e r : “1.By way of present petition, preferred under Article 226 of the Constitution of India, the challenge is made to the legality and validity of the show cause notice bearing No.IV / 9 - 10/ SCN / Ajanta Anjar Bhachau 2020-21 (DIN 20201064WX00007W3921), dated 8.10.2020 issued by the respondent No.2, essentially on the ground that the same is QE GUJARAT issued without any authority of law and in clear disregard to the binding precedents with the following prayers: \"18. A. This Hon'ble Court be pleased to issue a writ of or in the nature of mandamus or a writ of or Page 12 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 in the nature of prohibition or a writ of or in the nature of certiorari or any other appropriate writ, order or direction quashing and setting aside the show cause notice bearing No.IV/9 10/ SCN/Ajanta/Anjar-Bhachau/2020-21 (DIN 20201064WX00007W3921) dated 8.10.2020 issued by the respondent No.2 Annexure E hereto; B. Pending admission, hearing and final disposal of this petition, your Lordships be pleased to stay and suspend the operation and implementation of the show cause notice bearing No.IV/9-10/SCN/Ajanta/Anjar-Bhachau/2020-21 (DIN 20201064WX00007W3921) dated 8.10.2020 issued by the espondent No.2 at Annexure E hereto and be further pleased to restrain the respondent No.3 from proceeding further in any manner in regard to the adjudication or recovery of the demands raised by way of the said show cause notice; C. Ex parte ad interim relief in terms of prayer B above be granted; D. Such other and further reliefs as deemed just and expedient be granted.\" 2. The petitioner company manufactures Electric Energy Saving Lamps, Vitrified Tiles, Quartz Clocks etc. During the earthquake in the District of Kutch in 2001, Page 13 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 Notification No.39/2001-CE dated 31.7.2001 was issued by the Central Government granting exemption to the excisable goods cleared from the units of Kutch. The petitioner's unit, since was in Kutch, had availed the benefit of the said notification. The refund claim filed by the petitioner in respect of the Education Cess and Secondary & Higher Secondary Education Cess for the period from January-2007 to May-2007 was partly sanctioned, but rejected the claim of Education Cess and THE HIGH COURT Secondary & Higher Secondary Education Cess. 3. This was challenged before the Commissioner (Appeals), Rajkot, which upheld the refund order passed by the Assistant Commissioner on 13.9.2007; however, it did not grant Education Cess and Secondary & Higher Secondary Education Cess. Therefore, the challenge was before the Central Excise & Service Tax Appellate Tribunal ('CESTAT' for short), which allowed the appeal with consequential relief on 9.1.2009/25.4.2009. 4. The Adjudicating Authority, while sanctioning the refund claim, did not allow the refund claim worth Rs.14,86,015/- on 12.5.2010, which concerned Education Cess and Secondary & Higher Secondary Education Cess on the ground that this Notification No.39/2001-CE was available to Central Excise Duty and Additional Central Page 14 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 Excise Duty and would not cover the Education Cess and Secondary & Higher Secondary Education Cess. 5. This was challenged before the Commissioner (Appeals), Rajkot, which vide its order dated 18.12.2018 allowed the petitioner's claim. This order of 18.12.2018 has been accepted by the department. 6. On 22.1.2019, pursuant to the said order of the Commissioner (Appeals), Rajkot, the petitioner made an application in the office of the respondent No.2 for the refund of Rs.14,86,015/-, which has been accepted by the concerned authority. This amount has been already paid to the petitioner. 7. A show cause notice has been issued after one and half THE HIGH COURT years on 8.10.2020, proposing to recover an amount of Rs.14,86,015/- on the ground that only the exemption of of Central Excise and Additional Central Excise are provided under the Notification No.39/2001 and Education Cess and Secondary & Higher Secondary Education Cess would not be covered under the said Notification. 8. The petitioner is aggrieved by the fact that when there is no challenge to the order of Commissioner (Appeals), Rajkot dated 18.12.2018 and other orders, which have all attained finality, this initiation of the show cause notice is wholly without jurisdiction. The Page 15 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 petitioner is, therefore, before this Court with the aforementioned prayers. 9. We have heard learned advocate, Ms.Amrita Thakore, who has taken us through various decisions of the Apex Court as well as of this Court. She has emphasised that the judicial discipline also would require to give effect to the order of the higher appellate authorities and not to once again initiate the actions of recovering the very refund claim, which has been given to the petitioner after a long drawn battle. 10. Issue Notice for final disposal, returnable on 8.3.2021. Interim relief in terms of paragraph 18.B. is granted, till the returnable date. Learned Central Government Standing Counsel, Mr.Parth Divyeshvar waives service of Notice for and on behalf of the respondent No.1. 11. Learned advocate, Ms.Amrita Thakore, on a specific query raised by the Court submitted that the date of personal hearing by virtual mode was fixed on 12.1.2021; however, the notice has been received on 24.1.2021. There is no intimation of any date thereafter.” 3 . 1 S e r v i c e o f t h e s a i d i n t e r i m r e l i e f g r a n t e d b y t h i s C o u r t h a s b e e n s e r v e d d u l y . Page 16 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 A n a f f i d a v i t o n b e h a l f o f t h e p e t i t i o n e r f o r p l a c i n g o n r e c o r d f u r t h e r f a c t s i s f i l e d , w h e r e i n i t i s s t a t e d i n t e r a l i a t h a t t h e p e t i t i o n e r r e c e i v e d t h e s e c o n d h e a r i n g n o t i c e o n 1 6 . 0 2 . 2 0 2 1 . T h e p e t i t i o n e r a d d r e s s e d a l e t t e r o n 2 5 . 0 2 . 2 0 2 1 s e r v i n g u p o n t h e r e s p o n d e n t N o . 2 t h e c o p y o f t h e p e t i t i o n a n d t h e o r d e r o f t h i s C o u r t . T h e r e a f t e r o n 2 5 . 0 2 . 2 0 2 1 , t h e s e c o n d h e a r i n g n o t i c e d a t e d 1 6 . 0 2 . 2 0 2 1 w a s r e c e i v e d b y t h e p e t i t i o n e r f r o m r e s p o n d e n t N o . 2 w h e r e t h e d a t e o f h e a r i n g w a s f i x e d o n 2 4 . 0 2 . 2 0 2 1 , a d a y p r i o r t o t h e r e c e i p t o f t h e h e a r i n g n o t i c e . T h e r e f o r e , a c o m m u n i c a t i o n w a s s e n t t o t h e r e s p o n d e n t o n 0 2 . 0 3 . 2 0 2 1 i n f o r m i n g t h a t t h e s e c o n d h e a r i n g n o t i c e w a s n o t r e c e i v e d & i n f a c t , t h e s a m e a r r i v e d a f t e r t h e d a t e o f h e a r i n g . I t a l s o p o i n t e d o u t t h e o r d e r o f t h i s C o u r t . Page 17 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 4 . W e h a v e e x t e n s i v e l y h e a r d t h e l e a r n e d a d v o c a t e , M s . A m r i t a T h a k o r e a p p e a r i n g f o r t h e p e t i t i o n e r s a n d l e a r n e d A d d i t i o n a l S o l i c i t o r G e n e r a l f o r t h e U n i o n o f I n d i a ( A S G ) , M r . D e v a n g V y a s a s s i s t e d b y t h e l e a r n e d a d v o c a t e , M r . P a r t h D i v y e s h v a r f o r t h e r e s p o n d e n t N o s . 1 & 2 . 5 . L e a r n e d a d v o c a t e , M s . A m r i t a T h a k o r e h a s l a m e n t e d t h e a c t i o n o f t h e r e s p o n d e n t N o . 2 , w h i c h , a c c o r d i n g t o h e r , i s i n a c l e a r a n d f l a g r a n t v i o l a t i o n o f t h e s e t t l e d p r i n c i p l e s o f l a w . A c c o r d i n g t o h e r , t h e r e h a s t o b e a h i e r a r c h i c a l d i s c i p l i n e t o b e o b s e r v e d e v e n b y t h e q u a s i j u d i c i a l a u t h o r i t y . I t i s i m p e r m i s s i b l e f o r a n y o f f i c e r b e l o w i n t h e r a n k t o o v e r r e a c h t h e p r o c e s s o f l a w . I n c a s e o f q u a s i j u d i c i a l a u t h o r i t i e s a l s o , t h e d e c i s i o n o f t h e i r Page 18 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 a p p e l l a t e a u t h o r i t i e s s h a l l n e e d t o b e e s s e n t i a l l y b i n d i n g u p o n t h o s e w h o a r e j u n i o r s . N o t o n l y t h e p r i n c i p l e o f j u d i c i a l d i s c i p l i n e h a s b e e n c o m p l e t e l y g i v e n a g o b y , b u t t h e o f f i c e r c o n c e r n e d h a s a l s o v i o l a t e d t h e s e t t l e d j u d i c i a l p r i n c i p l e s a n d t h e r e f o r e , a c c o r d i n g t o h e r , n o t o n l y t h e C o u r t n e e d s t o a l l o w t h e s e p e t i t i o n s , b u t a l s o s a d d l e t h e o t h e r s i d e w i t h a h e a v y c o s t f o r m a k i n g i t d i f f i c u l t f o r t h e p e t i t i o n e r s . S h e h a s a l s o u r g e d t h a t i t i s a s e t t l e d p r i n c i p l e s t h a t a f t e r o n c e , t h e f i n a l i t y i s a t t a i n e d o f d e c i s i o n o f t h e a u t h o r i t i e s , t h e r e h a s t o b e a r e g i m e n t g o v e r n i n g j u d i c i a l d i s c i p l i n e w h e r e b y a g a i n , a n y s u b s e q u e n t e v e n t c a n n o t u p s e t t h a t d i s c i p l i n e a n d t h e o r d e r w h i c h h a s b e e n p a s s e d b e a r i n g i n m i n d t h e l a w w h i c h w a s p r e v a l e n t a t t h e r e l e v a n t t i m e . Page 19 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 A c c o r d i n g t o h e r , a s t h e r e i s a w e l l k n o w n p r i n c i p l e o f f i n a l i t y o f j u d i c i a l d e c i s i o n , w h i c h i s o n e o f t h e e s s e n t i a l i n g r e d i e n t s u p o n w h i c h t h e a d m i n i s t r a t i o n o f j u s t i c e r e s t s . 5 . 1 L e a r n e d a d v o c a t e , M s . A m r i t a T h a k o r e h a s r e l i e d o n t h e f o l l o w i n g d e c i s i o n s i n s u p p o r t o f h e r d e t a i l e d s u b m i s s i o n s : Sr No. Judgment 1 Union Of India Versus Kamlakshi Finance Corporation Ltd, reported in 1991 (55) ELT 433 (SC) 2 Commissioner Of Central Excise, Kanpur Versus Kothari Products Ltd., reported in 2008 (229) E.L.T. 12 (S.C.) 3 Commissioner Of Customs, New Delhi Versus Texcomash Export, reported in 2015 (322) E.L.T. 601 (S.C.) 4 Union Of India Versus Vicco Laboratories, reported in 2007 (218) E.L.T. 647 (S.C.) 5 Claris Lifesciences Ltd. Versus Union Of India, reported in 2013 (298) E.L.T. 45 (Guj.) 6 Claris Lifesciences Ltd. Versus Union Of India, reported in 2014 (305) E.L.T. 497 (Guj.) 7 Lubi Industries Llp Versus Union Of India, reported in 2016 (337) E.L.T. 179 (Guj.) 8 Commissioner Of Customs Versus Millat Fibers, reported in 2011 (271) Page 20 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 E.L.T. 512 (Guj.) 9 Lupin Limited Versus Union Of India, reported in 2013 (293) E.L.T. 354 (Guj.) 10 Hope Plantataions vs. Taluka Land Board, reported in 1999(5) SCC 590 11 Union of India vs. Madras Telephone, reported in 2006(8) SCC 662 12 Pradeep Kumar Maskara vs. State of WB, reported in 2015(2)SCC 653 13 Subramaniam Swamy vs. State of TN, reported in 2014(5) SCC 75 6 . P e r c o n t r a , l e a r n e d A S G , M r . D e v a n g V y a s i n h i s u s u a l f a i r n e s s h a s u r g e d t h a t i t i s u n d o u b t e d l y a n e x u b e r a n c e a n d o v e r e n t h u s i a s m o n t h e p a r t o f t h e o f f i c e r , w h i c h h a s l e d t o t h e i s s u a n c e o f t h e s h o w c a u s e n o t i c e . H e h a s u r g e d t h a t t h e r e i s n o m a l a f i d e i n s u c h i s s u a n c e o f s h o w c a u s e n o t i c e a n d i t i s o n l y b e c a u s e o f t h e s u b s e q u e n t c h a n g e b y w a y o f t h e d e c i s i o n o f t h e A p e x C o u r t t h a t t h e o f f i c e r h a s i s s u e d t h e s h o w c a u s e n o t i c e a n d t h e r e f o r e , n o t h i n g m u c h b e r e a d i n t o t h e a c t i o n o f t h e Page 21 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 r e s p o n d e n t N o . 2 , h o w e v e r h e c o u l d n o t b e i n a p o s i t i o n t o d e f e n d t h e a c t i o n s b e a r i n g i n m i n d t h e s e t t l e d p r i n c i p l e o f j u d i c i a l d i s c i p l i n e . 7 . A t t h e o u t s e t , w e a p p r e c i a t e t h e f a i r n e s s r e f l e c t e d b y t h e l e a r n e d A S G , M r . D e v a n g V y a s w h i c h i s w h a t i s e x p e c t e d o f t h e o f f i c e r s w h o a r e h o l d i n g c o n s t i t u t i o n a l p o s i t i o n . A n d t h i s a s p e c t i s o f t e n r e f l e c t e d i n t h e d e c i s i o n o f t h e A p e x C o u r t w h i c h m a y n o t b e n e c e s s a r y t o b e r e p r o d u c e d f o r b e i n g a w e l l s e t t l e d o b l i g a t i o n . 8 . R e v e r t i n g t o t h e m a t t e r o n h a n d s , t h e c h r o n o l o g i c a l d e t a i l s w h i c h h a v e b e e n g i v e n h e r e i n a b o v e n e e d n o t b e r e p e a t e d . S u f f i c e t o m a k e a c h a r t w h i c h c a n b e l o o k e d a t a g l a n c e . Page 22 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 Year Event Authority/Quasi Judicial Authority Outcome January, 2001 Earthquake in District Gujarat particularly in District Kutchch - - 31.07.2001 Issuance of exemption Notification No.39/2001-CE Central Government - 2007-2008 Petitioner preferred different claim for Central Excise Duty, ECSHSEC for the period from June, 2007 to March, 2008 Assistant Commissioner of Bhuj Partially sanctioned. Allowed Excise Duty but disallowed ECSHSEC 2008-2009 Notification No.39/2001-CE amended. Central Government - - Challenge made before the Commissioner of Appeals Commissioner of Appeals CESTAT, Ahmedabad Confirmed order of the Assistant Commissioner of Bhuj vide order dated 07.03.2008 and 27.06.2008 Petitioner approached the CESTAT Vide order dated 10.08.2009 and 09.11.2009 remand of the matter to the adjudicating authority. 10.06.2010 Petitioner approached Adjudicating Authority . Deputy Commissioner Central Excise Sanction of the refund claim, but denial Rs.54,10,810/- pertaining to ECSHSEC. 06.08.2010 Petitioner approached the Commissioner of Appeals. Commissioner of Appeals Allowed the same and granted both EC & SHSEC relying on the Circular dated 10.08.2004 and another Circular dated 08.04.2011 22.01.2019 Petitioner filed refund application seeking refund of Rs.54,10,810/-. Assistant Commissioner (Audit) This was cleared by per-audit of the department. Page 23 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 29.03.2019 Commissioner of Appeal’s order dated 19.12.2018 was challenged by the petitioner to the extent it rejected the part of refund claim. CESTAT,Ahmedabad Pending, no benefit to the petitioner 01.04.2019 Assistant Commissioner, Central GST after observing that the Commissioner (Appeals) had allowed the appeal of the petitioner related to EC & SHSEC. Assistant Commissioner, Central GST. The said order had accepted by the department. 08.10.2020 Subsequent decision of the Supreme Court in case Unicorn Industries vs. Union of India has been relied upon by the Assistant Commissioner. Assistant Commissioner Assistant Commissioner, Central GST has issued show cause notice to recover the amount of Rs.54,10,810/- 9 . I t i s q u i t e c l e a r f r o m t h e c h r o n o l o g y o f e v e n t s t h a t o n l y b e c a u s e t h e A p e x C o u r t r e n d e r e d i t s d e c i s i o n o n 0 6 . 1 2 . 2 0 1 9 a f t e r a b o u t e i g h t m o n t h s o f t h e g r a n t o f t h e r e f u n d , t h e d e c i s i o n i n c a s e o f U n i c o r n I n d u s t r i e s v s . U n i o n o f I n d i a ( s u p r a ) i s r e l i e d u p o n f o r i s s u a n c e o f t h e s a i d s h o w c a u s e n o t i c e b y t h e r e s p o n d e n t N o . 2 d i s r e g a r d i n g t h e o r d e r o f t h e C o m m i s s i o n e r ( A p p e a l s ) , w h i c h u n d o u b t e d l y a n d u n q u e s t i o n a b l y i s a s u p e r i o r a u t h o r i t y o f Page 24 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 t h e r e s p o n d e n t N o . 2 a n d w h i c h d e l i v e r e d t h e s a m e o n t h e s t r e n g t h o f l a w p r e v a l e n t a t t h e t i m e w h e n r e f u n d w a s s a n c t i o n e d . 1 0 . T h e d e c i s i o n , w h i c h h a d b e e n r e n d e r e d b y t h e C o m m i s s i o n e r ( A p p e a l s ) w a s f o l l o w i n g t h e d e c i s i o n o f t h e A p e x C o u r t i n c a s e o f S R D N u t r i e n t s P v t L t d v s . C C E , G u w a h a t i ( s u p r a ) . 1 1 . A p t w o u l d b e t o r e f e r a t t h i s j u n c t u r e t h e d e c i s i o n o f t h e A p e x C o u r t r e n d e r e d i n c a s e o f U n i o n o f I n d i a v s . K a m l a k s h i F i n a n c e C o r p o r a t i o n L T D . , r e p o r t e d i n 1 9 9 1 ( 5 5 ) E . L . T . 4 3 3 ( S . C . ) 1 1 . 1 T h e A p e x C o u r t w a s c o n s i d e r i n g t h e c a s e w h e r e , a c c o r d i n g t o t h e r e s p o n d e n t , t h e g o o d s m a n u f a c t u r e d b y t h e p e t i t i o n e r f e l l u n d e r t a r i f f h e a d i n g 8 5 . 4 7 o f t h e Page 25 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 s c h e d u l e d t o t h e C e n t r a l E x c i s e T a r i f f A c t , 1 9 8 5 . W h e r e a s a c c o r d i n g t o t h e p e t i t i o n e r , t h e g o o d s f e l l u n d e r h e a d i n g 3 9 . 1 9 o f t h e s a m e s c h e d u l e . T h e A s s i s t a n t C o l l e c t o r o f C e n t r a l E x c i s e h a d i s s u e d t h e n o t i c e t o t h e r e s p o n d e n t m a n u f a c t u r e r t o s h o w c a u s e a s t o w h y t h e p r o d u c t s h o u l d n o t b e c l a s s i f i e d u n d e r h e a d i n g 3 9 . 1 9 . T h e a s s e s s e e p o i n t e d o u t t h a t f o r i t s f a c t o r y a t B o r i v i l i , i t s c l a i m t h a t t h e g o o d s w e r e c l a s s i f i a b l e u n d e r h e a d i n g 8 5 . 4 6 h a d b e e n a c c e p t e d b y t h e C o l l e c t o r o f A p p e a l s . T h e A s s i s t a n t C o l l e c t o r , h o w e v e r , d i d n o t a c c e p t t h e c o n t e n t i o n o f t h e a s s e s s e e a n d h e d i s t i n g u i s h e d t h e o r d e r p a s s e d i n r e s p e c t o f t h e B o r i v i l i p l a n t . 1 1 . 2 T h e a s s e s s e e p r e f e r r e d a n a p p e a l t o t h e C o l l e c t o r ( A p p e a l s ) , w h o s e t a s i d e t h e Page 26 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 o r d e r o f t h e A s s i s t a n t C o l l e c t o r a n d o b s e r v e d t h a t r e a s o n g i v e n b y t h e A s s i s t a n t C o l l e c t o r f o r n o t f o l l o w i n g t h e o r d e r o f t h e C o l l e c t o r o f C e n t r a l E x c i s e ( A p p e a l s ) w a s u n s u s t a i n a b l e . H e , t h e r e f o r e , d i r e c t e d t h e A s s i s t a n t C o l l e c t o r t o p a s s a r e a s o n e d a n d s p e a k i n g o r d e r . 1 1 . 3 T h e A s s i s t a n t C o l l e c t o r r e i t e r a t e d t h e c o n c l u s i o n w h i l e p a s s i n g h i s s u b s e q u e n t o r d e r . H e a l s o c h o s e n o t t o g i v e t h e r e a s o n a s t o w h y t h e o r d e r o f C o l l e c t o r ( A p p e a l s ) w a s n o t f o l l o w e d . T h e a s s e s s e e a l s o p l a c e d b e f o r e h i m t h e d e c i s i o n o f t h e C E S T A T i n c a s e o f a n o t h e r p a r t y h a v i n g s i m i l a r f a c t s . H e d i s t i n g u i s h e d t h e s a m e o b s e r v i n g t h a t t h e d e c i s i o n h a d n o t b e e n a g r e e d t o b y t h e D e p a r t m e n t w h i c h h a d f i l e d a n a p p e a l t o t h e S u p r e m e C o u r t . Page 27 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 1 1 . 4 I n a W r i t P e t i t i o n , t h e B o m b a y H i g h C o u r t q u a s h e d t h e o r d e r o f t h e A s s i s t a n t C o l l e c t o r a n d d i r e c t e d t h e d e p a r t m e n t t o a l l o c a t e t h e m a t t e r t o a c o m p e t e n t o f f i c e r t o p a s s a p r o p e r o r d e r . T h e U n i o n o f I n d i a p r e f e r r e d a n a p p e a l b e f o r e t h e A p e x C o u r t , w h e r e t h e o f f i c e r c o n c e r n e d w a s d e f e n d e d b y t h e l e a r n e d A d d i t i o n a l S o l i c i t o r G e n e r a l t h a t i n p a s s i n g s e v e r e s t r i c t u r e s a g a i n s t h i m , t h e l e a r n e d j u d g e s h a d e r r e d . T h e A p e x C o u r t h e l d t h a t t h e o f f i c e r w a s n o t a c t u a t e d b y a n y m a l a f i d e s i n p a s s i n g t h e i m p u g n e d o r d e r . T h e i m p r e s s i o n o r a n x i e t y o f t h e A s s i s t a n t C o l l e c t o r o f t h e d e p a r t m e n t l o s i n g t h e r e v e n u e a l s o w a s n o t a r e m e d y a v a i l a b l e w i t h h i m . T h e C o u r t r e l i e d o n S e c t i o n 3 5 E t h a t i t c o n f e r s a d e q u a t e p o w e r s o n t h e d e p a r t m e n t t o r e s o l v e o r r e c t i f y t h e i s s u e . H o w e v e r , n o a m o u n t o f a n x i e t y t o s a f e g u a r d t h e i n t e r e s t o f r e v e n u e w o u l d r e l i e v e h i m o f o b l i g a t i o n t o f o l l o w j u d i c i a l d i s c i p l i n e . 1 1 . 5 A p t w o u l d b e t o r e p r o d u c e t h e Page 28 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 r e l e v a n t f i n d i n g s a n d o b s e r v a t i o n s o f t h e A p e x C o u r t : “7. The impression or anxiety of the Assistant Collector that, if he accepted the assessee’s contention, the department would lose revenue and would also have no remedy to have the matter rectified is also incorrect. Section 35E confers adequate powers on the department in this regard. Under sub-section (1), where the Central Board of Excise and Customs [Direct Taxes] comes across any order passed by the Collector of Central Excise with the legality or propriety of which it is not satisfied, it can direct the Collector to apply to the Appellate Tribunal for the determination of such points arising out of the decision or order as may be specified by the Board in its order. Under sub-section (2) the Collector of Central Excise, when he comes across any order passed by an authority subordinate to him, if not satisfied with its legality or propriety, may direct such authority to apply to the Collector (Appeals) for the determination of such points arising out of the decision or order as may be specified by the Collector of Central Excise in his order and there is a further right of appeal to the department. The position now, therefore, is that, if any order passed by an Assistant Collector or Collector is adverse to the interests of the Revenue, the immediately higher administrative authority has the power to have the matter satisfactorily resolved by taking up the issue to the Appellate Collector or the Page 29 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 Appellate Tribunal as the case may be. In the light of these amended provisions, there can be no justification for any Assistant Collector or Collector refusing to follow the order of the Appellate Collector or the Appellate Tribunal, as the case may be, even where he may have some reservations on its correctness. He has to follow the order of the higher appellate authority. This may instantly cause some prejudice to the Revenue but the remedy is also in the hands of the same officer. He has only to bring the matter to the notice of the Board or the Collector so as to enable appropriate proceedings being taken under S. 35E(1) or (2) to keep the interests of the department alive. If the officer’s view is the correct one, it will no doubt be finally upheld and the Revenue will get the duty, though after some delay which such procedure would entail. 8. We have dealt with this aspect at some length, because it has been suggested by the learned Additional Solicitor General that the observations made by the High Court, have been harsh on the officers. It is clear that the observations of the High Court, seemingly vehement, and apparently unpalatable to the Revenue, are only intended to curb a tendency in revenue matters which, if allowed to become widespread, could result in considerable harassment to the assessee-public without any benefit to the Revenue. We would like to say that the department should take these observations in the proper spirit. The observations of the High Court should be kept in mind in Page 30 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 future and utmost regard should be paid by the adjudicating authorities and the appellate authorities to the requirements of judicial discipline and the need for giving effect to the orders of the higher appellate authorities which are binding on them.” 1 1 . 6 T h u s , t h e e m p h a s i s o n t h e p a r t o f t h e A p e x C o u r t i s t o o b s e r v e t h e j u d i c i a l d i s c i p l i n e a n d t h e a p p e l l a t e a u t h o r i t i e s t o i n s i s t o n t h e j u d i c i a l d i s c i p l i n e t o b e o b s e r v e d f o r g i v i n g e f f e c t o f t h e o r d e r s o f t h e h i g h e r a p p e l l a t e a u t h o r i t i e s w h i c h a r e b i n d i n g u p o n t h e a d j u d i c a t i n g a u t h o r i t i e s . 1 2 .I n c a s e o f C o m m i s s i o n e r o f C e n t r a l E x c i s e , K a n p u r v s . K o t h a r i P r o d u c t s L t d , r e p o r t e d i n 2 0 0 8 ( 2 2 9 ) E . L . T . 1 2 ( S . C . ) , t h e D e m a n d w a s h e l d b y t h e T r i b u n a l a s b a r r e d u n d e r t h e l a w o f l i m i t a t i o n a n d i t a p p l i e d p r i n c i p l e o f r e s j u d i c a t a a s t h e i s s u e w a s c o v e r e d i n e a r l i e r p r o c e e d i n g s . Page 31 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 T h e r e w a s n o a p p e a l p r e f e r r e d b y D e p a r t m e n t a g a i n s t o r d e r o f T r i b u n a l a n d t h e o r d e r h a v i n g a t t a i n e d f i n a l i t y , t h e s h o w c a u s e n o t i c e a c c o r d i n g t o t h e A p e x C o u r t , w a s h i t b y t h e l i m i t a t i o n a n d p r i n c i p l e s o f r e s j u d i c a t a a n d t h e s a m e w a s n o t h e l d t o b e m a i n t a i n a b l e . 1 2 . 1 R e l e v a n t f i n d i n g s a n d o b s e r v a t i o n s o f t h e A p e x C o u r t a r e a s f o l l o w : “6. Aggrieved against the order of the Assistant commissioner, respondents filed appeal before the Commissioner (Appeals), Allahabad. The Commissioner vide his order dated 28-11-1997 set aside the order passed by the Assistant commissioner and allowed the appeal. It was held as under : “I have carefully gone through the case records, ground of appeal, submissions made during personal hearing and various case laws relied upon by the appellants. The appellants are engaged in the manufacture of Pan Masala falling under heading No. Page 32 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 2106.00 of Central Excise Tariff Act, 1985. They sell the product directly from the factory to the dealers situated in different States/Regions. The appellants also stock transfer some quantity to the C & F. Agents situated in some of the States/Regions. The ultimate consumer price is uniform all over the country. The price to be charged by the whole sale buyer to the retailers is also uniform. In order to ensure that the wholesale buyers get a uniform discount, expressed as a percentage over the landed cost, as also to take care of the varying rates of Sales Tax prevalent in the respective States, the appellants fix the basic prices by working backwards from the wholesale price. In other words the appellants explained that from the wholesale prices, they exclude the margin to the dealer and thereafter the Sales Tax to be suffered by the dealer and thereafter deduct the freight element which is charged on equalised basis and also the turnover tax if any payable. Thus the basic price plus excise duty is arrived at. This is bifurcated into basic price (assessable value) and excise duty. Thus while raising the sale invoices for the goods sold, the appellants raise the invoices for basic price (assessable value), excise duty and the equalised freight. The Central Sales Tax is also charged on the same. The appellants do not charge and recover any other amount over and above the amounts indicated in the Page 33 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 respective sales invoices. In the proceedings also there is no such allegation raised either in the show cause notice or in the order-in-original.” 7. This order of the Commissioner (Appeals) was confirmed by the Tribunal in appeal. Revenue did not carry any further appeal meaning thereby that it has attained finality. 8. In the present case, the Tribunal has set aside the order-in-original passed by the Commissioner and held that in view of the earlier decision given by the Tribunal, revenue was not justified in issuing a fresh show cause notice and the same was barred by limitation as well as by the principle of res judicata. The Tribunal has dismissed the appeal by observing thus : “All the facts and the evidence relied upon in the present proceedings were fully known to the departmental authorities when the seven show cause notices were issued to the appellants demanding duty of Rs. 6,09,75,357.23 covering the period from August, 1993 to July, 1995. There are no fresh investigation undertaken which would entail issue of this show cause notice. The relationship between the appellants and their dealers/consignment agents are covered by the agreements entered into by these parties. The Page 34 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 agreements were with the department right from the beginning when the earlier proceedings were initiated against the appellants, yet at no stage it was either felt or alleged that the prices of the goods as declared in the invoices issued by the appellants under Rule 52A at the time of removal of the goods from the factory to these places (Hyderabad, Bombay and Trichy) was not normal value/price of the goods and hence not acceptable. We are clear in our mind that the issue in the present appeal is fully covered by the decision of the Tribunal in the earlier proceedings in favour of the appellants and the Revenue are barred by limitation as well as on the principle of res judicata against raising the same issue again. Therefore, we allow these appeals by setting aside the impugned order passed by the Commissioner.” 1 3 .I n c a s e o f C o m m i s s i o n e r o f C u s t o m s , N e w D e l h i v s . T e x c o m a s h E x p o r t , r e p o r t e d i n 2 0 1 5 ( 3 2 2 ) E . L . T . 6 0 1 ( S . C . ) t h e r e s p o n d e n t b e f o r e t h e A p e x C o u r t e x p o r t e d c h i l d r e n ’ s g a r m e n t s t o R u s s i a u n d e r t h e c l a i m o f Page 35 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 d r a w b a c k d u r i n g t h e p e r i o d f r o m N o v e m b e r , 1 9 9 3 t o J u n e , 1 9 9 4 . T h e A s s i s t a n t C o l l e c t o r o f C u s t o m s , h a d p a s s e d t h e o r d e r a n d a g a i n s t t h i s f i x a t i o n o f v a l u e , a p p e a l w a s p r e f e r r e d , b u t t h e C o l l e c t o r ( A p p e a l s ) r e j e c t e d t h e a p p e a l p r e f e r r e d b y t h e r e s p o n d e n t . 1 3 . 1 T h e s e o r d e r s w e r e c h a l l e n g e d b y t h e r e s p o n d e n t b y f i l i n g r e v i s i o n a p p l i c a t i o n s a n d t h e s a m e h a d b e e n d e c i d e d b y t h e J o i n t S e c r e t a r y , G o v e r n m e n t o f I n d i a . H e s e t a s i d e t h e o r d e r o f t h e C o l l e c t o r ( A p p e a l s ) a n d r e m a n d e d t h e c a s e t o t h e A s s i s t a n t C o l l e c t o r f o r d e n o v o c o n s i d e r a t i o n , a f t e r m a k i n g f r e s h i n q u i r i e s . E v e n i n t h e s e c o n d r o u n d , t h e v a l u e o f t h e g o o d s h a s b e e n f i x e d a t R s . 2 1 0 / - p e r s e t f o r t h e p u r p o s e o f t h e d r a w b a c k a s w a s d o n e i n t h e f i r s t Page 36 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 o r d e r a n d a p p e a l a g a i n s t t h e s a m e h a d b e e n d i s m i s s e d b y t h e C o m m i s s i o n e r o f C u s t o m s ( A p p e a l s ) . T h e J o i n t S e c r e t a r y b y w a y o f a r e v i s i o n a l p o w e r s p a s s e d t h e o r d e r a n d e n h a n c e d t h e v a l u e o f g o o d s t o R s . 2 4 2 / - . O n t h e b a s i s o f a s h o w c a u s e n o t i c e a l l e g e d l y b e c a u s e o f f r a u d , t h e e n t i r e i s s u e w a s s o u g h t t o b e r e - o p e n e d . T h e C o m m i s s i o n e r o f C u s t o m s c o n f i r m e d t h e d e m a n d m a d e i n t h e s h o w c a u s e n o t i c e , t h e s a m e h a d b e e n s e t a s i d e b y t h e C E S T A T a n d t h e c h a l l e n g e w a s m a d e b y t h e d e p a r t m e n t t o t h e s a i d o r d e r o f C E S T A T . O n e o f t h e r e a s o n s w h y C E S T A T h a d c h o s e n t o n o t u p h o l d t h e a c t i o n o f r e - o p e n i n g t h e p r o c e e d i n g s w a s b e c a u s e t h a t a c c o r d i n g t o i t , w o u l d t a n t a m o u n t t o q u e s t i o n i n g t h e o r d e r o f t h e h i g h e r o f f i c i a l s . T h e o r d e r o f t h e C o m m i s s i o n e r h a d m e r g e d i n t o t h e o r d e r o f r e v i s i o n a l a u t h o r i t y a n d t h e r e f o r e , t h e Page 37 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 p r i n c i p l e o f r e s j u d i c a t a a l s o w o u l d a p p l y . 1 3 . 2 T h e A p e x C o u r t h e l d t h a t t h e s h o w c a u s e n o t i c e c o u l d n o t h a v e b e e n i s s u e d u n d e r S e c t i o n 2 8 o f t h e C u s t o m s A c t b y t h e C o m m i s s i o n e r f o r t h e r e - o p e n i n g o f i s s u e , w h i c h h a d b e e n s e t t l e d b y t h e h i g h e r a u t h o r i t y i . e . t h e J o i n t S e c r e t a r y . 1 3 . 3 A p t w o u l d b e t o r e p r o d u c e t h e r e l e v a n t f i n d i n g a n d o b s e r v a t i o n o f t h e A p e x C o u r t a s f o l l o w s : “5. Even if certain material came to the notice of the Commissioner, which became the basis for the show cause notice, the only proper course was to challenge the said order of the Joint Secretary by taking out other proceedings, as admissible in law. On this ground alone, we confirm the order of the CESTAT. However, at the same time, we give liberty to the appellant herein to take out appropriate proceedings, in accordance with law. It would be open to the appellant to invoke the principles of Section 14 of the Limitation Act insofar as limitation is concerned as the matter is kept pending in various judicial fora, including this Court.” Page 38 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 1 4 . I n c a s e o f U n i o n o f I n d i s v s . V i c c o L a b o r a t o r i e s , r e p o r t e d i n 2 0 0 7 ( 2 1 8 ) E L T 6 4 7 ( S C ) , t h i s w a s a c a s e o f i s s u a n c e o f s h o w c a u s e n o t i c e a n d r e o p e n i n g o f t h e i s s u e o f c l a s s i f i c a t i o n d i s p u t e , w h i c h w a s f i n a l l y c o n c l u d e d b y v i r t u e o f t h e d e c i s i o n o f H i g h C o u r t a n d A p e x C o u r t i n f a v o u r o f w r i t p e t i t i o n e r . T h e f r e s h s h o w c a u s e n o t i c e w a s i s s u e d p u r s u a n t t o l i b e r t y g i v e n b y t h e A p e x C o u r t t o t h e D e p a r t m e n t t o t a k e s u c h t e s t i f o t h e r w i s e s o e n t i t l e d f o r c l a s s i f y i n g t h e p r o d u c t . A c c o r d i n g t o t h e A p e x C o u r t , t h e s h o w c a u s e n o t i c e w a s n o t h i n g b u t a r e p e t i t i o n o f e a r l i e r s h o w c a u s e n o t i c e s w i t h s l i g h t v a r i a t i o n s w h i c h i n n o w a y w a s r e l a t a b l e t o a n y d i f f e r e n t t e s t a n d t h u s , t h e s h o w c a u s e n o t i c e a m o u n t s t o r e o p e n i n g o f i s s u e w h i c h i s n o t Page 39 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 p e r m i s s i b l e . T h e A p e x C o u r t h e l d t h a t t h e i n t e r f e r e n c e a t t h e s h o w c a u s e n o t i c e s t a g e s h o u l d b e r a r e a n d n o t i n a r o u t i n e m a n n e r . H o w e v e r , w h e r e t h e s h o w c a u s e n o t i c e s i s s u e d w i t h o u t j u r i s d i c t i o n a n d / o r a b u s e o f p r o c e s s o f l a w , t h e w r i t c o u r t w o u l d n o t h e s i t a t e t o i n t e r f e r e . 1 4 . 1 R e l e v a n t f i n d i n g s a n d o b s e r v a t i o n s o f t h e A p e x C o u r t a r e a s f o l l o w : “30. Normally, the writ court should not interfere at the stage of issuance of show cause notice by the authorities. In such a case, the parties get ample opportunity to put forth their contentions before the concerned authorities and to satisfy the concerned authorities about the absence of case for proceeding against the person against whom the show cause notices have been issued. Abstinence from interference at the stage of issuance of show cause notice in order to relegate the parties to the proceedings before the concerned authorities is the normal rule. However, the said rule is not without exceptions. Where a show cause notice is issued either without jurisdiction or in an abuse of process of law, certainly in that case, the writ court would not hesitate to interfere even at the stage of issuance of show cause notice. Page 40 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 The interference at the show cause notice stage should be rare and not in a routine manner. Mere assertion by the writ petitioner that notice was without jurisdiction and/or abuse of process of law would not suffice. It should be prima facie established to be so. Where factual adjudication would be necessary, interference is ruled out. 31. Case of the respondent that the classification of the said products having attained finality pursuant to the decision of this Court, the appellants have no jurisdiction to issue impugned show cause notice on the ground on which it has been issued and it virtually amounts to re-opening of the issue which stands concluded by the decision of this Court, and that therefore it is an abuse of process of law. The High Court after referring to the history of litigation rightly concluded that the matter stood concluded by judgments of this Court and the High Court in respondents’ case. 32. In the earlier judgment this Court had given liberty to the Department in the following terms : “Although the adjudicating authority had found in the course of the hearing that the market survey indicated that the product in question was known as a cosmetic we do not go into the question as this was not the ground on which the show cause notice was issued. The show cause notices having proceeded on a misapprehension of the tests laid down in Shree Baidyanath’s case, the same cannot be sustained. Page 41 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 The appeals are accordingly dismissed without any order as to costs. It will be open to the Department to take such test if otherwise so entitled in respect of the products for the purpose of classifying the products under the appropriate tariff heading as they may be advised.” 33. However, as rightly observed by the High Court the impugned show cause notice was nothing but a repetition of the earlier show cause notices with slight variations which in no way was relatable to any different test. 34. When the factual scenario is considered in the background of the legal principles set out above, the inevitable conclusion is that the appeal is sans merit, deserves dismissal which we direct. Costs made easy. “ 1 5 .T h i s C o u r t i n c a s e o f C l a r i s L i f e s c i e n c e s v s . U n i o n o f I n d i a , r e p o r t e d i n 2 0 1 3 ( 2 9 8 ) E L T 4 5 ( G u j ) w a s c o n s i d e r i n g t h e q u e s t i o n o f c o m p u t a t i o n o f e d u c a t i o n c e s s a n d s e c o n d a r y a n d h i g h e r e d u c a t i o n c e s s w h i c h w a s d e c i d e d f i n a l l y b y t h e T r i b u n a l i n f a v o u r o f t h e p e t i t i o n e r s . A s o n t h e d a t e o f d e c i s i o n b y t h i s C o u r t , s u c h d e c i s i o n o f t h e T r i b u n a l h e l d Page 42 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 t h e f i e l d a n d b i n d i n g o n t h e A d j u d i c a t i n g A u t h o r i t y . T h e C o u r t t h e r e f o r e h e l d t h a t i f t h e d e p a r t m e n t w a s o f t h e o p i n i o n t h a t t h e i s s u e w a s n o t f r e e f r o m d o u b t , i t w a s n o t o p e n f o r t h e A d j u d i c a t i n g A u t h o r i t y t o i g n o r e t h e b i n d i n g p r e c e d e n t . T h e A d j u d i c a t i n g A u t h o r i t y a s h e l d e m p h a t i c a l l y a c t e d a s a q u a s i - j u d i c i a l a u t h o r i t y a n d i s b o u n d b y t h e l a w o f p r e c e d e n t a n d i t r e i t e r a t e d b i n d i n g e f f e c t o f t h e o r d e r p a s s e d b y t h e h i g h e r a u t h o r i t y o r T r i b u n a l o f s u p e r i o r j u r i s d i c t i o n . 1 5 . 1 R e l e v a n t f i n d i n g s a n d o b s e r v a t i o n s o f t h i s C o u r t a r e a s f o l l o w : “4. It is the case of the petitioners that the petitioners have been paying as excise duty, the sum total of duties of Customs and Education Cess as well as Secondary and Higher Education Cess on the basic Customs duty leviable on similar medicines imported into India. However, the dispute of the Department is regarding calculation of the excise duty leviable on the clearances made by the petitioners as EOU to the domestic tariff area suggesting that Education Cess as well as Secondary Page 43 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 and Higher Education Cess are leviable on sum total of the customs duties and above cesses. In other words, the case of the Department is that the Education Cess and Secondary and Higher Education Cess to be computed second time would be inclusive of the customs duty and such cesses. Previously, such issue was raised by the Department against the petitioners. The adjudicating authority having ruled against the petitioners, the matter was carried further in appeal. Finally, the Customs, Excise & Service Tax Appellate Tribunal, (“the Tribunal” for short) in the case of this very petitioners ruled in favour of the petitioners by an order dated 21-6-2010. In such order, the Tribunal held and observed as under :- “2. The issue that has arisen is whether the appellant is liable to pay education cess again on the amount which has been worked out by calculating the customs duty payable on the goods in respect of clearances made by 100% EOU to domestic tariff area. The lower authorities have held that even after arriving at the measure of Customs duty for working out the Central Excise duty payable, the education cess has to be levied once again. 3. Both sides agree that this issue is covered by the decision of this Tribunal in the case of M/ s. Sarla Performance Pvt. Ltd. - 2010-TIOL- 408- CESTAT Ahmedabad, wherein it was held Page 44 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 that once the measure of Customs duty equivalent to Central Excise duty leviable on the like goods has been worked out, the question of levying education cess separately in respect of clearances by 100% EOU to DTA does not arise. Inasmuch as the issue is covered by the decision of the Tribunal cited above, we allow the appeal with consequential relief to the appellant.” 5. Such decision of the Tribunal along with similar other decisions were challenged by the Department before this Court. Several appeals were clubbed together. Division Bench of this Court by an order dated 19-1-2012 passed in Tax Appeal No. 2012 of 2012 and connected appeals held such appeals were not maintainable before the High Court and would lie before the Supreme Court only. 7. Having heard learned Counsel for the parties, we are of the opinion that the approach adopted by the adjudicating authority was wholly impermissible in law. At the outset, we may record that we are conscious that such order is appealable in terms of statutory appeals provided under Central Excise Act, 1944. However, we find that the adjudicating authority committed serious error in disregarding binding precedent and that there are absolutely no disputed facts. We would, therefore, not insist that the petitioners once again follow the same Page 45 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 gamut of taking the appeal route. To revert back to the issue at hand, we may recall that the question of computation of Education Cess and Secondary and Higher Education Cess was decided finally by the Tribunal in favour of the petitioners. As of now, such decision of the Tribunal holds the field. Such decision of the Tribunal would be binding on the adjudicating authority. Even if the Department is of the opinion that the issue is not free from doubt, it is not open for the adjudicating authority to ignore the binding precedent. We may notice that under the Central Excise Act, 1944 and the Customs Act, the Department has the right to appeal even against the order-in-original passed by the adjudicating authority. This is in contrast to the provisions contained in the Income-tax Act, 1961 where against an order passed by the assessing officer, the Department has no right to appeal. Only remedy available to the Revenue is by way of a revision against the order of the assessing officer that too only if it is found that such order is erroneous and prejudicial to the interest of the Revenue. Such rigors however, are not applicable insofar as the Department’s right to appeal against the order of the adjudicating authority is concerned under the Central Excise Act, 1944. 8. The adjudicating officer acts as a quasi judicial authority. He is bound by the law of precedent and binding effect of the order passed by the higher Page 46 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 authority or Tribunal of superior jurisdiction. If his order is thought to be erroneous by the Department, the Department can as well prefer appeal in terms of the statutory provisions contained in the Central Excise Act, 1944.” 1 5 . 2 T h e C o u r t f o r s o h o l d i n g r e l i e d o n t h e d e c i s i o n o f t h e A p e x C o u r t r e n d e r e d i n t h e c a s e o f U n i o n o f I n d i a v s . K a m l a k s h i F i n a n c e C o r p o r a t i o n L t d . r e p o r t e d i n 1 9 9 1 ( 5 5 ) E . L . T . 4 3 3 ( S . C . ) 1 6 .T h e C o u r t i n c a s e o f C l a r i s L i f e s c i e n c e s v s . U n i o n o f I n d i a , r e p o r t e d i n 2 0 1 4 ( 3 0 5 ) E L T 3 9 7 ( G u j ) w a s c o n s i d e r i n g t h e p e t i t i o n p r e f e r r e d u n d e r A r t i c l e 2 2 6 o f t h e C o n s t i t u t i o n o f I n d i a b y t h e p e t i t i o n e r w h i c h w a s a P u b l i c L i m i t e d C o m p a n y e n g a g e d i n t h e b u s i n e s s o f m a n u f a c t u r e o f p a t e n t o r p r o p r i e t a r y m e d i c i n e s . T h e g r i e v a n c e o n t h e p a r t o f t h e p e t i t i o n e r w a s i n r e l a t i o n Page 47 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 t o t h e c a l c u l a t i o n s o f e x c i s e d u t i e s l e v i a b l e o n D o m e s t i c T a r i f f A r e a ( “ D T A ” f o r s h o r t ) D T A c l e a r a n c e s m a d e b y E x p o r t O r i e n t e d U n i t ( “ E O U ” f o r s h o r t ) o n t h e g r o u n d t h a t t h e e d u c a t i o n c e s s a s w e l l a s s e c o n d a r y a n d h i g h e r e d u c a t i o n c e s s w e r e l e v i a b l e o n s u m t o t a l o f c u s t o m d u t i e s . T h i s a s p e c t w a s a l r e a d y c o n s i d e r e d i n s i m i l a r d i s p u t e b y C E S T A T h o l d i n g t h a t l e v i n g o f t h e s a i d c e s s f o r t h e s e c o n d a n d t h e t h i r d t i m e w a s i n c o r r e c t o n t h e p a r t o f t h e r e v e n u e a n d i t w a s n o t i n a c c o r d a n c e w i t h t h e s c h e m e o f s e c t i o n 3 o f t h e C e n t r a l E x c i s e A c t . I n t h a t r o u n d o f l i t i g a t i o n , t h e r e l i a n c e w a s p l a c e d o n a d e c i s i o n o f S a r l a P e r f o r m a n c e F i b e r s L t d . v s . C o m m i s s i o n e r o f C . E x . V a p i , r e p o r t e d i n 2 0 1 0 ( 2 5 3 ) E . L . T . 2 0 3 ( T r i A h m d . ) , w h i c h h a d a t t a i n e d t h e f i n a l i t y a s t h i s C o u r t h a d Page 48 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 a l l o w e d t h e w r i t p e t i t i o n a n d s t r u c k d o w n t h e o r d e r p a s s e d b y t h e r e s p o n d e n t i n O r d e r - i n - O r i g i n a l . 1 6 . 1 T h e g r i e v a n c e o n t h e p a r t o f t h e p e t i t i o n e r w a s t h a t t w o s h o w c a u s e n o t i c e s w e r e i s s u e d d e m a n d i n g t h e c e s s o n c e a g a i n e v e n a f t e r t h i s C o u r t h a d s t r u c k d o w n t h e a d j u d i c a t i o n o r d e r p a s s e d b y t h e s e c o n d r e s p o n d e n t . I n t h e s e c i r c u m s t a n c e s , t h i s C o u r t r e l i e d o n t h e d e c i s i o n o f U n i o n o f I n d i a v s . K a m l a k s h i F i n a n c e C o r p o r a t i o n L t d . ( s u p r a ) a n d h a s s e n t s t r o n g d i s a p p r o v a l f o r t h e r e p e a t e d a c t s o f t h e a d j u d i c a t i n g a u t h o r i t y o f i g n o r i n g t h e d e c i s i o n o f t h i s C o u r t . 1 6 . 2 R e l e v a n t f i n d i n g s a n d o b s e r v a t i o n s o f t h i s C o u r t a r e a s f o l l o w : Page 49 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 “21.It needs to be noted with strong disapproval that the repeated acts of the adjudicating authority of ignoring the decision of this Court is impermissible although till date the Revenue has deemed it fit not to challenge the order passed by the higher authority or Tribunal of superior jurisdiction. 22. The submission of Revenue is that the group of appeals decided by the Court in Sarla Performance Fibers Ltd. v. Commissioner of C. Ex., Vapi (supra) does not conform to the monetary limits set by the said Tribunal nor do the question falls under the exception clause and hence, are not carried to the Apex Court. Be that as it may, it is an undisputed position that such decision of the Tribunal remains unchallenged. xxx 25. Thereafter, as mentioned hereinabove in Special Civil Application No. 12686 of 2012, once again order of adjudicating authority was struck down by a clarification that it would not be seen as a stamp on the part of the High Court, of upholding the view of the Tribunal contained in its decision dated 21-6-2010 and it would be open for the Department to call in question such a view in appropriate proceedings as permissible under the law. While so holding the adjudicating officer was reminded that he acts as quasi-judicial authority and is bound by the law of precedence and regarding the binding effect of the order of the higher authority which is the Tribunal in the instant case. It was held that if such order is found to be erroneous by the Department, it needs to prefer an Page 50 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 appeal as per the statutory provisions contained in the Central Excise Act. The decision of the Apex Court rendered in Union of India v. Kamlakshi Finance Corporation Ltd. (supra) holds in unambiguous terms that the Revenue officers are bound by the decision of the appellate authorities. 26. Despite such clear and specific directions and authoritative pronouncements, act of issuance of show cause notice by the Deputy Commissioner is wholly impermissible and unpalatable and deserves to be quashed and struck down with a specific note of strong disapproval. The respondents simply could not have exercised the powers contained under the statute in such arbitrary exercise and in complete disregard to the pronouncement of this Court particularly reminding the Revenue authorities of the binding effect of decision of Tribunal on the identical question of law. This not only led to multiplicity of proceedings but also speaks of disregard to the direction of this Court rendered in the earlier petition of this very petitioner. Resultantly, petition stands allowed. Both the show cause notices dated 21-8- 2012 and 22-1-2013 are quashed and struck down. 27. Although, we have clarified in the earlier petition of the very assessee, being Special Civil Application No. 12686/2012 that striking down of the order which was Page 51 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 impugned there should not be seen as any indication of our view of upholding the view of the Tribunal contained in its decision dated 21-6-2010 and it would be for the Department to call in question such a view in appropriate proceeding; as is permissible to the Department. We also reiterate the same in the present petition, while striking down the impugned notices issued by the Assessing Officer. This surely is not to be construed as putting a final stamp on the decision of the Tribunal dated 21st June 2010 although the Department has chosen not to challenge such decision before the Apex Court after this Court upheld preliminary objections of jurisdiction in Tax Appeal No. 2012 of 2010 and allied Appeals noting exclusion clause in sub-clause (1) of Sec. 35G of the Central Excise Act. However, till that is done, Tribunal’s order dated 21st June 2010 shall continue to hold the field.” 1 7 . I n c a s e o f L u b i I n d u s t r i e s L L P v s . U n i o n O f I n d i a , r e p o r t e d i n 2 0 1 6 ( 3 3 7 ) E . L . T . 1 7 9 ( G u j . ) t h e i d e n t i c a l i s s u e h a d a l r e a d y b e e n d e c i d e d b y t h e C E S T A T i n f a v o u r o f t h e p e t i t i o n e r , d e s p i t e w h i c h t h e a d j u d i c a t i n g a u t h o r i t y h a d o n c e a g a i n g i v e n a d e c i s i o n a g a i n s t t h e p e t i t i o n e r . T h e Page 52 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 C o u r t h e l d t h a t i t i s a s e r i o u s e r r o r i n i g n o r i n g t h e b i n d i n g j u d g m e n t o f S u p e r i o r C o u r t t h a t t o o i n c a s e o f t h e s a m e a s s e s s e e , t h e d e p a r t m e n t a u t h o r i t i e s w o u l d b e b o u n d b y t h e j u d i c i a l p r o n o u n c e m e n t s o f t h e s t a t u t o r y T r i b u n a l s . E v e n i f , t h e d e c i s i o n o f T r i b u n a l w a s n o t c a r r i e d f u r t h e r i n a p p e a l o n a c c o u n t o f l o w t a x e f f e c t , i t w a s n o t o p e n f o r t h e a d j u d i c a t i n g a u t h o r i t y t o i g n o r e t h e r a t i o o f s u c h d e c i s i o n . T h e o n l y c h o i c e o p e n f o r a d j u d i c a t i n g a u t h o r i t y w a s t o d e c i d e t h e c a s e i n c o n s o n a n c e w i t h t h e j u d g m e n t o f T r i b u n a l a n d t h e r e a f t e r l e a v e i t t o D e p a r t m e n t a l A u t h o r i t i e s t o d e c i d e t h e q u e s t i o n o f f i l i n g a p p e a l a g a i n s t s u c h a n o r d e r , i f o t h e r w i s e p e r m i s s i b l e i n l a w . 1 7 . 1 R e l e v a n t f i n d i n g s a n d o b s e r v a t i o n s Page 53 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 o f t h i s C o u r t a r e a s f o l l o w : “6. In our opinion, the Assistant Commissioner committed a serious error in ignoring the binding judgment of superior Court that too in case of the same assessee. The principle of precedence and judicial comity are well established in our legal system, which would bind an authority or the Court by the decisions of the Coordinate Benches or of superior Courts. Time and again, this Court has held that the departmental authorities would be bound by the judicial pronouncements of the statutory Tribunals. Even if the decision of the Tribunal in the present case was not carried further in appeal on account of low tax effect, it was not open for the adjudicating authority to ignore the ratio of such decision. It only means that the Department does not consciously agree to the view point expressed by the Tribunal and in a given case, may even carry the matter further. However, as long as a judgment of the Tribunal stands, it would bind every Bench of the Tribunal of equal strength and the departmental authorities taking up such an issue. An order that the adjudicating authority may pass is made appealable, even at the hands of the Department, if the order happens to aggrieve the Department. This is clearly provided under Section 35 read with Section 35E of the Central Excise Act. Therefore, even after the adjudicating authority passes an order in favour of the assessee on the basis of the judgment of the Tribunal, it is always open Page 54 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 to the Department to file appeal against such judgment of the adjudicating authority. 7. Reliance of the adjudicating authority on the decision of the Supreme Court in case of Southern Structures Ltd. (supra), was plainly erroneous. In such judgment, the question of penalty was a sole question required to be considered. In fact, the question of includability of the pre-delivery inspection charges in the assessable value of the goods, which was decided by the Tribunal, had achieved finality since the assessee had not filed appeal against such judgment. The case of Southern Structures Ltd. (supra), therefore, did not touch this aspect at all. Likewise reliance on Larger Bench decision of the Tribunal in case of Maruti Suzuki (supra), was also misconceived. This judgment was also considered by the Tribunal in petitioner’s own case, despite which the demand was ordered to be deleted. Only choice open for the adjudicating authority, therefore, was to decide the case in consonance with the judgment of the Tribunal dated 16-6-2014 and thereafter leave it to the departmental authorities to decide the question of filing appeal against such an order, if otherwise permissible in law. Impugned order dated 16-10-2015 is set aside. Ordinarily, in view of the above discussion, we would have allowed the Assistant Commissioner to pass a fresh order, leaving it open to the Department to take its options thereafter. However, the amount involved is not substantial. In any case, it is below the minimum tax Page 55 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 effect prescribed by the Department in its latest circular enabling the Department to prefer appeal to the Tribunal and the High Court. Additionally, we are informed that in case of other assessees, similar issues have been dropped at the show cause notice itself within the same Commissionerate.” 1 8 .I n c a s e o f C o m m i s s i o n e r O f C u s t o m s V e r s u s M i l l a t F i b e r s , r e p o r t e d i n 2 0 1 1 ( 2 7 1 ) E . L . T . 5 1 2 ( G u j . ) t h e r e f u n d c l a i m w a s a l l o w e d i n i t i a l l y , w i t h d i r e c t i o n s t o a d j u s t i t a g a i n s t o t h e r d u e s o f a s s e s s e e , b u t w i t h o u t v e r i f y i n g t h e a s p e c t o f b i n d i n g p r e c e d e n t , o n t h e g r o u n d o f u n d u e e n r i c h m e n t , a f t e r i m p l e m e n t a t i o n o f t h a t o r d e r , s h o w c a u s e n o t i c e w a s i s s u e d f o r r e j e c t i o n o f r e f u n d a l l e g e d l y “ e r r o n e o u s l y g r a n t e d ” , i n a b s e n c e o f p r o o f o f p a s s i n g o f d u t y b u r d e n . T h e C o u r t h e l d t h a t i s s u a n c e o f l a t e r s h o w c a u s e n o t i c e a m o u n t e d t o t h e a d j u d i c a t i n g a u t h o r i t y r e v i e w i n g i t s e a r l i e r o r d e r . T h e i m p u g n e d o r d e r c r e d i t i n g t h e a m o u n t t o Page 56 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 C o n s u m e r W e l f a r e F u n d , i n e f f e c t a n d s u b s t a n c e , a m o u n t e d t o s e t t i n g a s i d e e a r l i e r o r d e r , w h i c h w a s i m p e r m i s s i b l e a s a d j u d i c a t i n g a u t h o r i t y a s t h e a u t h o r i t y c o n c e r n e d h a s n o p o w e r t o r e v i e w o r s i t i n a p p e a l o v e r i t s e a r l i e r o r d e r . P r o p e r c o u r s e o f a c t i o n w a s f o r D e p a r t m e n t t o s e e k r e v i e w o f e a r l i e r o r d e r . 1 8 . 1 R e l e v a n t f i n d i n g s a n d o b s e r v a t i o n s o f t h i s C o u r t a r e a s f o l l o w : “8. Sub-section (2) of Section 129D empowers the Commissioner of Customs to call for and examine the record of any proceeding in which an adjudicating authority subordinate to him has passed any decision or order under the Act for the purpose of satisfying himself as to the legality or propriety of any such decision or order and to direct such authority to apply to the Commissioner (Appeals) for the determination of such points arising out of the decision or order as may be specified by the Commissioner in his order. Sub-section (4) thereof provides for preferring an appeal against the order of the concerned authority. In the circumstances, if the adjudicating authority was of the view that the doctrine of Page 57 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 unjust enrichment had not been examined while making the order of refund, the proper course to adopt was to take recourse to the provisions of Section 129D. A perusal of the order-in-original dated 15-2-2006 shows that the adjudicating authority has held that the refundable amount of Rs. 2,42,110/- is required to be credited to the Consumer Welfare Fund established under Section 12C of the Central Excise Act, 1944 and that the same cannot be refunded to the party by appropriating against outstanding Government dues of Rs. 2,75,306/- of Customs Duty vide O-I-O dated 3-2-2004. Thus in effect and substance the adjudicating authority, has set aside its earlier order dated 13-2-2004 whereby the refund amount had been ordered to be appropriated against outstanding Government dues. The adjudicating authority has no power or authority under the Act to reconsider or review or sit in appeal over its earlier order. No such power or authority has been pointed out by the learned counsel for the appellant. 9. In the aforesaid factual background, the Commissioner (Appeals) was justified in holding that the show cause notice issued by the adjudicating authority on the ground of unjust enrichment, would amount to review of his own order which was not permissible. The view expressed by the Commissioner (Appeals) that the proper course of action was for the Department to review the order under Section 129D(2) of the Act and thereafter file appeal under Section 129D(4) is in consonance with the provisions of Page 58 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 the Act. The impugned order of the Tribunal whereby it has confirmed the findings recorded by the Commissioner (Appeals) does not suffer from any legal infirmity so as to warrant interference. No question of law, much less any substantial question of law can be stated to arise out of the impugned order of the Tribunal. “ 1 9 .I n c a s e o f L u p i n L i m i t e d v s . U n i o n O f I n d i a , r e p o r t e d i n 2 0 1 3 ( 2 9 3 ) E . L . T . 3 5 4 ( G u j . ) t h e C o u r t w h i l e c o n s i d e r i n g t h e s c o p e o f i n t e r f e r e n c e b y H i g h C o u r t a t s h o w c a u s e n o t i c e s t a g e h e l d t h a t f i r s t r o u n d o f s h o w c a u s e n o t i c e o n i s s u e o f e x c i s a b i l i t y r e s u l t e d i n d r o p p i n g o f p r o c e e d i n g s , o n t h e v e r y s e t o f f a c t s t h e f r e s h s h o w c a u s e w i t h o u t a n y n e w m a t e r i a l h a d b e e n i s s u e d w h i c h c o u l d n o t p r i m a f a c e i s u g g e s t t h a t p r o d u c t c o u l d b e a s m a r k e t a b l e . T h e C o u r t h e l d t h a t p e r m i t t i n g d e p a r t m e n t t o p r o c e e d w i t h s u c h s h o w c a u s e n o t i c e w o u l d b e w h o l l y f u t i l e , p r e j u d i c i a l t o t h e a s s e s s e e a n d Page 59 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 a m o u n t s t o a b u s e o f p r o c e s s o f l a w . T h e C o u r t h e l d t h a t t h e s e c o n d s h o w c a u s e n o t i c e w a s a l s o w i t h o u t j u r i s d i c t i o n a n d h e n c e , i n t e r f e r e n c e u n d e r A r t i c l e 2 2 6 o f C o n s t i t u t i o n o f I n d i a w a s n e c e s s a r y . I t h a s a l s o f u r t h e r h e l d t h a t A l t e r n a t i v e r e m e d y i s n o t a b a r i n c a s e o f i n h e r e n t l a c k o f j u r i s d i c t i o n o r f a i l u r e o f n a t u r a l j u s t i c e o r a c t i o n b e i n g o p p o s e d t o s t a t u t o r y p r o v i s i o n s . 1 9 . 1 R e l e v a n t f i n d i n g s a n d o b s e r v a t i o n s o f t h i s C o u r t a r e a s f o l l o w : “37. We would now in view of the above conclusions, deal with the question of maintainability of the petition. It is undoubtedly true and well settled that the High Court would be loath to interfere in the show cause notice proceedings. The Apex Court has stated, time and again, that such interference at the show cause notice stage should be kept to the minimum. However, it is not inviolable rule and alternative remedy would not be a bar if there is inherent lack of jurisdiction or there is failure of natural justice or that the action is opposed to statutory provisions. In case of Whirlpool Corporation v. Registrar of Trade Marks, Mumbai and Others, reported in AIR 1999 SC 22, the Supreme Court observed as under : Page 60 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 “20. Much water has since flown beneath the bridge, but there has been no corrosive effect on these decisions which, though old, continue to hold the field with the result that law as to the jurisdiction of the High Court in entertaining a writ petition under Article 226 of the Constitution, in spite of the alternative statutory remedies, is not affected, specially in a case where the authority against whom the writ is filed is shown to have had no jurisdiction or had purported to usurp jurisdiction without any legal foundation.” 38. In the present case, as we have held earlier, first show cause notice resulted in dropping of the proceedings. The Tribunal held that there was no material to establish that the product was marketable. On the same set of facts, a fresh show cause notice has been issued. Such notice is based on no new material which would even prima facie suggest that the product can be treated to be marketable. Permitting the Department to proceed with such show cause notice proceedings would be wholly futile, would cause prejudice to the petitioners and would amount to abuse of the process of law. In that sense of the matter, issuance of second show cause notice on same set of facts on which the first show cause notice had been terminated, would also be without jurisdiction. 39. The decision of the Apex Court in the case of Union of India v. Guwahati Carbon Ltd. (supra) was rendered in the background where the assessee had challenged the decision of the Tribunal by filing a writ petition before the High Court. Against such decision of the Tribunal under Section 35L of the Central Excise Act, appeal would lie before the Supreme Court to the exclusion of the High Court. It was in this background that the Apex Court found that it would not be appropriate for the writ court to entertain the writ petition under Article 226 of the Constitution. Notably even in such decision, the Apex Page 61 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 Court did not hold that the writ petition is not maintainable. It was in this very background that we had in our order dated 20-6- 2012, following the decision of the Apex Court in the case of Union of India v. Guwahati Carbon Ltd. (supra), non-suited the petitioners. The petitioners had approached in writ petitions challenging the decision of the Tribunal which looking to the controversy involved, was appealable before the Supreme Court. We, therefore, came to the conclusion that ordinarily though it may be open for the High Court to by-pass appellate remedy and entertain the writ petition directly ignoring such alternative remedy available, in the present case, petitioners must take the appeal route. 40. In the present case, facts are different. The petitioners have approached at a stage where show cause notice has been issued. Such show cause notice, we have held, is lacking inherent jurisdiction. Question of driving the petitioners to avail of alternative remedy, therefore, would not arise. 41. With respect to invocation of extended period of limitation, we find no substance whatsoever in the stand of the Department. The petitioners have been manufacturing the drug in question since years, utilizing intermediate chemical by way of captive consumption. Such process is known to the Department since decades. Contention of the petitioners is that such intermediate chemical is not a marketable goods and therefore, not exigible to excise duty. Whatever be the legal validity of such a stand, surely, it is highly a debatable and arguable point. Particularly when the Department has full knowledge that the petitioners are manufacturing such drugs, it can clearly be stated that there is any fraud, concealment or wilful misstatement on the part of the petitioners. In fact, the very premise of the second show cause notice is that in the first round of litigation, the Tribunal having observed that there is no evidence to hold that the product is marketable, and on further investigations, the Department has issued the second show Page 62 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 cause notice. If this be so, we are left to wonder on what basis does the Department contend that the evasion of duty if at all is on account of fraud, collusion or wilful misstatement on the part of the petitioners so as to invoke extended period of limitation.” 2 0 .I t i s q u i t e c l e a r t h u s t h a t t h e i s s u e i n t h e m a t t e r o n t h e h a n d s h a d a l r e a d y a t t a i n e d t h e f i n a l i t y r e l y i n g o n t h e d e c i s i o n o f t h e A p e x C o u r t i n c a s e o f S R D N u t r i e n t s P v t L t d v s . C C E , G u w a h a t i ( s u p r a ) a n d t h e p e t i t i o n e r s h a d b e e n f o u n d e l i g i b l e f o r t h e r e f u n d o f E C S H S E C . T h e C o m m i s s i o n e r ( A p p e a l s ) i n t h e s e c o n d r o u n d h a d r e l i e d o n t h e l e t t e r d a t e d 1 0 . 0 8 . 2 0 0 4 a n d C i r c u l a r o f C e n t r a l B o a r d o f E x c i s e a n d C u s t o m s d a t e d 0 8 . 0 4 . 2 0 1 1 . 2 0 . 1 A p t w o u l d b e t o r e p r o d u c e t h e r e l e v a n t f i n d i n g s a n d o b s e r v a t i o n s o f t h e C o m m i s s i o n e r ( A p p e a l s ) . “7.The appellant contented that 'duty of excise' includes Education Cess and Secondary & Higher Education Cess in terms of provisions of Section 93 of the Finance Act, 2004 Page 63 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 and Section 138 of the Finance Act, 2007 and hence, the provisions of refund and exemption of the Central Excise Act, 1944 are also equally applicable to Education Cess and Secondary & Higher Education Cess; that the exemption under Notification No. 39/2001-CE dated 31.07.2001 is also applicable to Education Cess and Secondary & Higher Education Cess and hence, they are eligible for refund/recredit of Education Cess and Secondary & Higher Education Cess. I find that the appellant, a manufacturing unit situated in District of Kutch, availed benefit of exemption under Notification No. 39/2001-CE dated 31.07.2001, as amended. The said notification is reproduced as under: \"Kutch (Gujarat) - Exemption to excisable goods (except those specified in Annexure) and cleared from Units in Kutch District of Gujarat In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), read with sub-section (3) of section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and sub-section (3) of section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978), the Central Government being satisfied that it is necessary in the public interest so to do, hereby exempts the goods specified in the First Schedule to the Central Excise Page 64 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 Tariff Act, 1985 (5 of 1986) other than goods specified in the Annexure appended to this notification and cleared from a unit located in Kutch district of Gujarat from so much of the duty of excise or the additional duty of excise, as the case may be, leviable thereon under any of the said Acts as is equivalent to the amount of duty paid by the manufacturer of goods other than the amount of duty paid by utilization of CENVAT credit under the CENVAT Credit Rules, 2001: Provided that in the case of a unit having an original value of investment in plant and machinery installed in the factory below rupees twenty crore on the date of commencement of commercial production in that unit, the exemption contained herein shall apply only for the first clearances up to an aggregate value not exceeding twice the value of such investment from the date of commencement of commercial production, in each year. 2. The exemption contained in this notification shall be given effect to in the following manner, namely : (a) The manufacturer shall submit a statement of the duty paid other than the amount of duty paid by utilization of CENVAT credit under the CENVAT Credit Rules, 2001, to the Assistant Commissioner or the Deputy Commissioner of Central Excise, as the case Page 65 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 may be, by the 7th day of the next month in which the duty has been so paid. (b) The Assistant Commissioner or Deputy Commissioner of Central Excise, as the case may be, after such verification, as he may deem necessary, shall refund the amount of duty paid other than the amount of duty paid by utilization of CENVAT credit during the month under consideration to the manufacturer by the 15th day of the next month. (c) If there is likely to be any delay in such verification, the Assistant Commissioner or the Deputy Commissioner of Central Excise, as the case may be, shall refund the amount on provisional basis by the 15th day of the next month to the month under consideration, and thereafter may adjust the amount of refund by such amount as may be necessary in the subsequent refunds admissible to the manufacturer.\" 7.1 The Education Cess was levied vide of Sections 91 to 93 of Chapter VI of the Finance (No.2) Act, 2004, which read as under: 91. Education Cess. (1) Without prejudice to the provisions of sub-section (11) of section 2, there shall be levied and collected, in accordance with the provisions of this Chapter as surcharge for purposes of the Union, a cess to be called the Education Cess, to Page 66 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 fulfil the commitment of the Government to provide and finance universalisd quality basic education. (2) The Central Government may, after due appropriation made by Parliament by law in this behalf, utilise, such sums of money of the Education Cess levied under sub-section (11) of section 2 and this Chapter for the purposes specified in sub-section (1), as it may consider necessary. 92. Definition. The words and expressions used in this Chapter and defined in the Central Excise Act, 1944 (1 of 1944), the Customs Act, 1962 (52 of 1962) or Chapter V of the Finance Act, 1994 (32 of 1994), shall have the meanings respectively assigned to them in those Acts or Chapter, as the case may be. 93. Education Cess on excisable goods. - (1) The Education Cess levied under section 91, in the case of goods specified in the First Schedule to the Central Excise Tariff Act 1985 (5 of 1986), being goods manufactured or produced, shall be a duty of excise (in this section referred to as the Education Cess on excisable goods), at the rate of two per cent, calculated on the aggregate of all duties of excise (including special duty of excise or any other duty of excise but excluding Education Cess on excisable goods) which are levied and collected by the Central Page 67 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 Government in the Ministry of Finance (Department of Revenue), under the provisions of the Central Excise Act, 1944 (1 of 1944) or under any other law for the time being in force. (2) The Education Cess on excisable goods shall be in addition to any other duties of excise chargeable on such goods, under the Central Excise Act, 1944 (1 of 1944) or any other law for the time being in force. (3) The provisions of the Central Excise Act. 1944 (1 of 1944) and the rules made thereunder. Including those relating to refunds and exemptions from duties and imposition of penalty shall, as far as may be, apply in relation to the levy and collection of the Education Cess on excisable goods as they apply in relation to the levy and collection of the duties of excise on such goods under the Central Excise Act 1944 or the rules, as the case may be.\" 7.5 CBEC vide Circular No. 134/3/2011/ST dated 08.04.2011 again clarified that since Education Cess and Secondary & Higher Education Cess were levied and collected as percentage of service tax, no Education Cess and Secondary & Higher Education Cess would be payable, when and wherever service tax is nil by virtue of exemption. The said Page 68 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 circular was issued in context of service tax matter but the principle was accepted therein by the Board and hence would apply in the present case also. Circular No. 134/3/2011/ST dated 08.04.2011 is reproduced as under: \"Subject: Education Cess and Secondary and Higher Education Cess – Reg. Representations have been received from the field formations, seeking clarification regarding the applicability of service tax exemption to Education Cess (refers to both Education Cess leviable under Finance (No. 2) Act, 2004 and Secondary and Higher Education Cess leviable under Finance Act, 2007), under notifications where whole of service tax stands exempted. Apparently the doubt arises in the context of Tribunal's Order in the matter of M/s. Balasore Alloys Ltd. v. CCE, Customs and Service Tax, BBSR-I (2010- TIOL-1659-CESTAT-KOL) = 2010 (20) S.T.R. 506 (Tribunal). 2. The issue has been examined. Though Tribunal's Order referred above is in favor of revenue, it is inconsistent with the policy intention of the Government to exempt education cess in addition to service tax, where 'whole of service tax stands exempted. According to section 95(1) of Finance (No. 2) Act, 2004 and section 140(1) of Finance Act, 2007, Education Cess and Secondary and Higher Education Cess are leviable and collected as service tax, and when whole of service tax Page 69 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 is exempt, the same applies to education cess as well. Since Education Cess is levied and collected as percentage of service tax, when and wherever service tax is NIL by virtue of exemption. Education Cess would also be NIL. 3. This being the principle, field formations are directed not to initiate proceedings to recover the education cess, where whole of service tax stands exempted under the notification. Extending the same principle, where education cess has been refunded to exporters along with service tax, by virtue of exemption notifications where whole of service tax is exempt, the same need not be recovered.\" 7.6 In view of above, Education Cess and Secondary & Higher Education Cess were part of the Central Excise duty and since the central excise duty was exempted by way of refund, Education Cess and Secondary & Higher Education Cess would also be exempted by way of refund. This view finds support from the judgement of the Hon'ble Supreme Court in the case of SRD Nutrients Pvt. Ltd. reported as 2017 (355) ELT 481 (SC), wherein it has held that: \"20. One aspect that clearly emerges from the reading of these two circulars is that the Government itself has taken the position that where whole of excise duty or Service Tax is exempted, even the Education Cess as well Page 70 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 as Secondary and Higher Education Cess would not be payable. These circulars are binding on the Department. 21. Even otherwise, we are of the opinion that it is more rational to accept the aforesaid position as clarified by the Ministry of Finance in the aforesaid circulars. Education Cess is on excise duty. It means that those assessees who are required to pay excise duty have to shell out Education Cess as well. This Education Cess is introduced by Sections 91 to 93 of the Finance (No. 2) Act, 2004. As per Section 91 thereof, Education Cess is the surcharge which the assessee is to pay. Section 93 makes it clear that this Education Cess is payable on 'excisable goods' i.e. in respect of goods specified in the first Schedule to the Central Excise Tariff Act, 1985. Further, this Education Cess is to be levied @ 2% and calculated on the aggregate of all duties of excise which are levied and collected by the Central Government under the provisions of Central Excise Act, 1944 or under any other law for the time being in force. Sub-section (3) of Section 93 provides that the provisions of the Central Excise Act, 1944 and the rules made thereunder, including those related to refunds and duties, etc., shall as far as may be applied in relation to levy and collection of Education Cess on excisable goods. A conjoint reading of these provisions would amply demonstrate that Education Cess as a surcharge, is levied @ 2% on the duties of excise which are payable under the Act. It can, therefore, be clearly inferred that when Page 71 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 there is no excise duty payable, as it is exempted, there would not be any Education Cess as well, inasmuch as Education Cess @2% is to be calculated on the aggregate of duties of excise. There cannot be any surcharge when basic duty itself is NII. ………… 24. For the aforesaid reasons, we allow these appeals and hold that the appellants were entitled to refund of Education Cess and Higher Education Cess which was paid along with excise duty once the excise duty itself was exempted from levy. There shall, however, be no order as to cost.\" (Emphasis supplied) 7.7 In view of above, I hold that the appellant is eligible for refund Education Cess and Secondary & Higher Education Cess.” 2 1 . A l l o w i n g t h e a p p e a l , b y t h e o f f i c e r c o n c e r n e d o n 1 9 . 1 2 . 2 0 1 8 a l l o w e d t h e r e f u n d c l a i m p e r t a i n i n g t o t h e E C S H S E C , t h i s h a d a l s o b e e n c h a l l e n g e d b e f o r e t h e C E S T A T b y t h e p e t i t i o n e r s o n l y o n a l i m i t e d g r o u n d o f r e j e c t i o n o f a p a r t o f a r e f u n d c l a i m , h o w e v e r , t h e d e p a r t m e n t h a d p r e f e r r e d n o a p p e a l a n d a c c e p t e d t h e d e c i s i o n o f t h e C o m m i s s i o n e r ( A p p e a l s ) . T h e r e f o r e , w h e n t h e p e t i t i o n e r h a d p r e f e r r e d t h e r e f u n d c l a i m Page 72 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 o n 2 2 . 0 1 . 2 0 1 9 , a f t e r a s c e r t a i n i n g t h e s t a t u s o f t h e o r d e r d a t e d 1 9 . 1 2 . 2 0 1 8 o f t h e C o m m i s s i o n e r ( A p p e a l s ) , t h e s a m e h a d b e e n a l l o w e d o n t h e g r o u n d t h a t t h e d e p a r t m e n t h a d a c c e p t e d t h e o r d e r o f C o m m i s s i o n e r ( A p p e a l s ) a n d h e n c e , t h e c l a i m h a d b e e n c l e a r e d b y t h e p r e - a u d i t o f t h e d e p a r t m e n t . T h i s h a s a l s o b e e n r e f l e c t e d i n i t s r e f u n d o r d e r d a t e d 0 1 . 0 4 . 2 0 2 0 a n d t h e p e t i t i o n e r h a d a l s o r e c e i v e d b a c k t h e s a i d a m o u n t . T h e r e f o r e , t h e i m p u g n e d s h o w c a u s e n o t i c e o n c e a g a i n o f r a i s i n g t h e v e r y i s s u e w h e n t h e o r d e r o f C o m m i s s i o n e r ( A p p e a l s ) h a s a t t a i n e d f i n a l i t y w i t h o u t a n y c h a l l e n g e b y t h e d e p a r t m e n t , w h i c h d e s e r v e s i n d u l g e n c e . I t i s a j u d i c i a l d i s c i p l i n e w h i c h d e m a n d s f o l l o w i n g t h e m a n d a t e o f s u p e r i o r a u t h o r i t y , e v e n w h e n i t i s a q u a s i j u d i c i a l b o d y a s s u c h d i s c i p l i n e i s a n i n t i g r a l p a r t o f t h i s w e l l l a i d d o w n p r i n c i p l e a n d d e s e r v e s s c r u p u l o u s o b s e r v a n c e b y a l l c o n c e r n e d . N o o n e i s p e r m i t t e d t o o b l i t e r a t e t h i s w e l l d e f i n e d b o u n d a r i e s , e v e n i n a z e a l t o e a r n m o r e r e v e n u e o r p r o f i t t h e i n t e r e s t o f t h e S t a t e a s d o n e Page 73 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 b y t h e r e s p o n d e n t N o . 2 . H e a l s o w o u l d n o t b e p e r m i t t e d t o r e l y u p o n t h e s u b s e q u e n t d e c i s i o n o f t h e A p e x C o u r t r e n d e r e d i n c a s e o f U n i c o r n I n d u s t r i e s v s . U n i o n o f I n d i a ( s u p r a ) w h i c h h a s b e e n d e l i v e r e d o n 1 9 . 1 2 . 2 0 1 8 , m u c h a f t e r t h e p r o c e s s o f g r a n t o f r e f u n d a l s o w a s o v e r . T h e d e c i s i o n , w h i c h w a s h e l d t h e f i e l d b e i n g o f S R D N u t r i e n t s P v t L t d v s . C C E , G u w a h a t i ( s u p r a ) w a s f o l l o w e d b y t h e C o m m i s s i o n e r ( A p p e a l s ) . T h e d e c i s i o n o f t h e A p e x C o u r t w o u l d b i n d o n e a n d a l l , b u t , i t c a n n o t a v a i l g r o u n d t o w r e c k a n y i s s u e w h i c h h a s a t t a i n e d f i n a l i t y . M o r e p a r t i c u l a r l y , w h e n i t d o e s n o t g i v e a n y m a n d a t e o r a u t h o r i s a t i o n o r d i r e c t i o n t o t h e c o n c e r n e d o f f i c e r t o q u e s t i o n a n d c h a l l e n g e t h e r e f u n d o r d e r w h i c h h a s a l r e a d y b e e n p a s s e d a n d t h e i s s u e s w h i c h a r e n o l o n g e r s u b s i s t i n g . W h e n t h e o f f i c e r c o n c e r n e d h a s n o d i r e c t i o n t o r a i s e a n y c l a i m o f r e f u n d r e t r o s p e c t i v e l y ( w h i c h c o u l d n e v e r b e ) . T h e s u b s e q u e n t d i r e c t i o n o f t h e A p e x C o u r t c a n n o t f u r n i s h a r e a s o n t o r a i s e d e m a n d r e t r o s p e c t i v e l y i n t h e i s s u e w h i c h i s Page 74 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 c o n c l u d e d . 2 2 .T h e s h o w c a u s e n o t i c e i s i s s u e d w i t h o u t a n y n e w m a t e r i a l i n t h e m a t t e r a n d o n t h e v e r y g r o u n d w h i c h h a d b e e n d e c i d e d b y t h e C o m m i s s i o n e r ( A p p e a l s ) a n d t h e r e f o r e i t i s e x f a c e i w i t h o u t j u r i s d i c t i o n a n d h e n c e , t h e i n t e r f e r e n c e u n d e r A r t i c l e 2 2 6 o f t h e C o n s t i t u t i o n o f I n d i a d e s p i t e t h e a v a i l a b i l i t y o f t h e a l t e r n a t i v e r e m e d y w o u l d b e n e c e s s a r y i n t h e i n s t a n t c a s e . 2 3 .T h e s h o w c a u s e n o t i c e s i n c e i s c h a l l e n g e d a l s o o n t h e g r o u n d o f m a l a f i d e a n d t h i s h a v i n g b e e n i s s u e d o n a p r e m i s e o f t h e d e c i s i o n o f t h e A p e x C o u r t r e n d e r e d i n c a s e o f U n i c o r n I n d u s t r i e s v s . U n i o n o f I n d i a ( s u p r a ) , w e h a v e c h o s e n t o l o o k i n t o t h e s a m e c l o s e l y w h e r e t h e r a t i o d e c e d e n t i s a s f o l l o w s : “This Court in Union of India v. Modi Rubber Limited has also considered when the exemption is granted under the particular provision; it would not cover any other kind of duty of excise imposed under separate Acts. This Court observed thus: “10. We may incidentally mention that in the Page 75 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 appeals a question of interpretation was also raised in regard to the Notification bearing No. 249/67 dated November 8, 1967 exempting tyres for tractors from “so much of the duty leviable thereon under item 16 of the First Schedule to the Central Excises and Salt Act, 1944 as is in excess of 15 per cent”. The argument of the respondents in the appeals was that the exemption granted under this notification was not limited to the duty of excise payable under the Central Excises and Salt Act, 1944 but it also extended to special duty of excise, additional duty of excise and auxiliary duty of excise leviable under other enactments. This argument plainly runs counter to the very language of this notification. It is obvious that the exemption granted under this notification is in respect of “so much of the duty leviable thereon under item 16 of the First Schedule to the Central Excises and Salt Act, 1944 as is in excess of 15 per cent” and these words describing the nature and extent of the exemption on their plain natural construction, clearly indicate that the exemption is in respect of duty of excise leviable under the Central Excises and Salt Act, 1944 and does not cover any other kind of duty of excise. No more discussion is necessary in regard to this question beyond merely referring to the language of this notification.” Page 76 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 The appeals were allowed, and it was held that exemption was not available in respect of special duty of excise or additional duty of excise or auxiliary duty of excise. A threeJudge Bench in Rita Textiles Private Limited v. Union of India, 1986 SCC Supp. 557, has followed the decision of Modi Rubber Limited (supra). The decision in Modi Rubber Limited (supra) squarely covers the issue and is rendered by a Co-ordinate Bench. 39. Rule 8 of Central Excise Rules, 1944, authorises the Central Government to grant an exemption to any excisable goods from the whole or any part of duty leviable on such goods. Rule 8 is extracted hereunder: “8. Power to authorise an exemption from duty in special cases.—(1) The Central Government may from time to time, by notification in the official Gazette, exempt (subject to such conditions as may be specified in the notification) any excisable goods from the whole or any part of duty leviable on such goods. (2) The Central Board of Excise and Customs may by special order in each case exempt from the payment of duty, under circumstances of an exceptional nature, any excisable goods.” The word ‘duty’ is defined under Rule 2(v) to mean the duty as levied under the Act. Page 77 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 40. Notification dated 9.9.2003 issued in the present case makes it clear that exemption was granted under Section 5A of the Act of 1944, concerning additional duties under the Act of 1957 and additional duties of excise under the Act of 1978. It was questioned on the ground that it provided for limited exemption only under the Acts referred to therein. There is no reference to the Finance Act, 2001 by which NCCD was imposed, and the Finance Acts of 2004 and 2007 were not in vogue. The notification was questioned on the ground that it should have included other duties also. The notification could not have contemplated the inclusion of education cess and secondary and higher education cess imposed by the Finance Acts of 2004 and 2007 in the nature of the duty of excise. The duty on NCCD, education cess and secondary and higher education cess are in the nature of additional excise duty and it would not mean that exemption notification dated 9.9.2003 covers them particularly when there is no reference to the notification issued under the Finance Act, 2001. There was no question of granting exemption related to cess was not in vogue at the relevant time imposed later on vide Section 91 of the Act of 2004 and Section 126 of the Act of 2007. The provisions of Act of 1944 and the Rules made thereunder shall be applicable to refund, and the exemption is only a reference to the source of power to exempt the NCCD, education cess, secondary and higher education cess. A notification has to be issued for Page 78 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 providing exemption under the said source of power. In the absence of a notification containing an exemption to such additional duties in the nature of education cess and secondary and higher education cess, they cannot be said to have been exempted. The High Court was right in relying upon the decision of threeJudge Bench of this Court in Modi Rubber Limited (supra), which has been followed by another three Judge Bench of this Court in Rita Textiles Private Limited (supra). 41. The Circular of 2004 issued based on the interpretation of the provisions made by one of the Customs Officers, is of no avail as such Circular has no force of law and cannot be said to be binding on the Court. Similarly, the Circular issued by Central Board of Excise and Customs in 2011, is of no avail as it relates to service tax and has no force of law and cannot be said to be binding concerning the interpretation of the provisions by the courts. The reason employed in SRD Nutrients Private Limited (supra) that there was nil excise duty, as such, additional duty cannot be charged, is also equally unacceptable as additional duty can always be determined and merely exemption granted in respect of a particular excise duty, cannot come in the way of determination of yet another duty based thereupon. The proposition urged that simply because one kind of duty is exempted, other kinds of duties automatically fall, cannot be accepted as there is no Page 79 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 difficulty in making the computation of additional duties, which are payable under NCCD, education cess, secondary and higher education cess. Moreover, statutory notification must cover specifically the duty exempted. When a particular kind of duty is exempted, other types of duty or cess imposed by different legislation for a different purpose cannot be said to have been exempted. 42. The decision of larger bench is binding on the smaller bench has been held by this Court in several decisions such as Mahanagar Railway Vendors’ Union v. Union of India & Ors. (1994) Suppl. 1 SCC 609, State of Maharashtra & Ors. v. Mana Adim Jamat Mandal, AIR 2006 SC 3446 and State of Uttar Pradesh & Ors. v. Ajay Kumar Sharma & Ors. (2016) 15 SCC 289. The decision rendered in ignorance of a binding precedent and/or ignorance of a provision has been held to be per incuriam in Subhash Chandra & Ors. v. Delhi Subordinate Services Selection Board & Ors. (2009) 15 SCC 458, Dashrath Rupsingh Rathod v. State of Maharashtra (2014) 9 SCC 129, and Central Board of Dawoodi Bohra Community & Ors. v. State of Maharashtra & Ors. (2005) 2 SCC 673. It was held that a smaller bench could not disagree with the view taken by a larger bench. 43. Thus, it is clear that before the Division Bench deciding SRD Nutrients Private Limited and Bajaj Auto Limited (supra), the previous binding decisions of Page 80 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 threeJudge Bench in Modi Rubber (supra) and Rita Textiles Private Limited (supra) were not placed for consideration. Thus, the decisions in SRD Nutrients Private Limited and Bajaj Auto Limited (supra) are clearly per incuriam. The decisions in Modi Rubber (supra) and Rita Textiles Private Limited (supra) are binding on us being of Coordinate Bench, and we respectfully follow them. We did not find any ground to take a different view.” 2 4 . T h i s n o w h e r e r e q u i r e s t h e r e o p e n i n g o f t h e p r o c e s s w h i c h h a d a l r e a d y a t t a i n e d t h e f i n a l i t y a n d q u i e t u s . W e a c c e p t t h e v e r s i o n o f t h e l e a r n e d A S G t h a t t h i s i s n o t a c a s e w h e r e w e c a n i m p u t e a n y m a l a f i d e s t o t h e r e s p o n d e n t N o . 2 . I t i s o v e r e n t h u s i a s m o f t h e o f f i c e r t o a d v a n c e t h e d e p a r t m e n t a l c a u s e t h a t w i t h o u t g r a s p i n g t h e r a t i o o n t h e s u b j e c t a n d d i s r e g a r d t o t h e s e t t l e d p r i n c i p l e s o f l a w t h a t h e h a s i n i t i a t e d t h e a c t i o n a n d h e n c e , t h e i n t e r f e r e n c e i s a m u s t b y q u a s h i n g a n d s e t t i n g a s i d e t h e i m p u g n e d s h o w c a u s e n o t i c e . 2 5 . R e s u l t a n t l y , b o t h t h e p e t i t i o n s a r e a l l o w e d q u a s h i n g a n d s e t t i n g a s i d e t h e i m p u g n e d s h o w c a u s e n o t i c e s d a t e d 0 8 . 1 0 . 2 0 2 0 b e a r i n g N o . I V / 9 - 1 1 / S C N / A j a n t a / A n j a r - B h a c h a u / Page 81 of 82 C/SCA/3320/2021 JUDGMENT DATED: 14/10/2021 2 0 2 0 - 2 1 ( D I N : 2 0 2 0 1 0 6 4 W X 0 0 0 0 4 X 7 A 7 8 ) a n d s h o w c a u s e n o t i c e N o . I V / 9 - 1 0 / S C N / A j a n t a / A n j a r - B h a c h a u / 2 0 2 0 - 2 1 ( D I N 2 0 2 0 1 0 6 4 W X 0 0 0 0 7 W 3 9 2 1 i s s u e d b y t h e r e s p o n d e n t N o . 2 . 2 6 . T h e s e h a v i n g b e e n i s s u e d a s c a n b e n o t i c e d i n w a k e o f t h e d e c i s i o n o f t h e A p e x C o u r t , r e a d i n g m o r e i n t o t h e f i n a l d i r e c t i o n a s a l s o f r o m o v e r a l l f a c t s a n d c i r c u m s t a n c e s , w e d o n o t h o l d t h i s a g a i n s t t h e o f f i c e r c o n c e r n e d t o d i r e c t a n y t h i n g o r o f a w a r d i n g c o s t i n t h i s m a t t e r . S u f f i c e t o n o t e t h a t t h e a p t t r a i n i n g f o r o b s e r v a n c e o f j u d i c i a l d i s c i p l i n e b e r e n d e r e d a n d i n t h e e v e n t o f a n y d i f f i c u l t i e s , r e c o u r s e t o p r o v i s i o n u n d e r S e c t i o n 3 5 E c a n a l w a y s b e t a k e n a s p e r m i s s i b l e . P e t i t i o n s s t a n d d i s p o s e d o f a c c o r d i n g l y . 2 6 . O v e r a n d a b o v e t h e r e g u l a r m o d e o f s e r v i c e , d i r e c t s e r v i c e i s p e r m i t t e d t h r o u g h s p e e d p o s t a s w e l l a s e - m o d e . Sd/- (SONIA GOKANI, J) Sd/- (RAJENDRA M. SAREEN,J) M.M.MIRZA Page 82 of 82 "