Problem with ultra-graph pro GEQ 3102 - Behringer

I have a really weird problem with my Behringer Ultra-graph pro geq 3102...

i feed signal into the unit (XLR or jack, doesn't matter) and the EQ works fine on channel 2, but when i try channel 1...

the signal goes in, shows up on the meter, and when i put the meter into I/O mode and activate the controls, the meter traces what is supposedly being sent out of the processing circuits. i.e. if i put all faders up or add too much gain, the meter shows a red clip light etc. EXCEPT: the EQ faders/gainpot/hi cut pot etc make ABSOLUTELY NO DIFFERENCE TO THE AUDIO AT ALL!

audio goes in - and comes out again (out of the output XLR/Jack), and the meters on the front show that EQing etc IS happening - but it isn't! - the only thing that comes out is the unprocessed original audio, but the meter says im getting an EQ'ed signal out.
:confused:

this is quite confusing....

i have had a look inside for tell-tale signs of malfunction i.e. dried Caps, burnt PCB, scorched Op-amps etc - but there is no visual clues whatsoever. all connections look fine, no loose wires etc.

in short, channel 2 processes & meters audio just fine, but the top channel (channel 1) spits the original audio out unaltered -although the meter shows the signal to be going through the EQ bridge.