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December 2015

The adjudicating authority has to follow the order of Larger Bench unless the factual situation of the case calls for different interpretation of law.

By Puloma Dalal
Jayesh Gogri
Mandar Telang, Chartered Accountants
Reading Time 1 mins
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33. 2015 (40) STR 26 (Ker) Muthoot Finance Ltd. vs. Union of India.

The adjudicating authority has to follow the order of Larger Bench unless the factual situation of the case calls for different interpretation of law.

Facts

The Appellant is engaged in providing service on behalf of Western Union, a company having its operation outside India. A similar issue arose earlier, which was settled by Larger Bench of the Tribunal in case of Muthoot Finance Ltd vs. Commissioner of C. Ex, Chandigarh, 2013(29) STR (257) (Tri-Delhi) in Appellant’s favour. It was contended that the department should follow the order of the Tribunal before raising demand against them when the facts of the case were similar. However, no cognisance was taken of the said order and demand was confirmed.

Held

The High Court observed that no distinction on facts is made in the Order-In-Original. Therefore, it is held that the order already passed by the Larger Bench of the Tribunal is binding on adjudicating authority to follow unless the factual situation calls for different interpretation. Accordingly, quashing the demand, the department was directed to consider matter afresh.

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