Clarification regarding binding nature of circular and instructions"
Recently, CBEC issued Circular No. 1006/13/2015-CX dated 21st September, 2015 vide F .No.96/90/2015-CX.1 to clarify issues related to binding nature of circular and instructions which are contrary to the judgment(s) delivered by Honble Supreme Court.
Circular draws attention towards judgment of Hon’ble Supreme Court in case of M/s Ratan Melting & Wire Industries Vs Commissioner of Central Excise, Bolpur 2008(231) E.L.T.22(SC)/2008-TIOL-104-SC-CX-CB, wherein Hon’ble Supreme Court has held that:
“Circular and instructions issued by the Board are no doubt binding in law on the authorities under the respective statutes, but when the Supreme Court or the High Court declares the law on the question arising for consideration, it would not be appropriate for the court to direct that the circular should be given effect to and not to a view expressed in a decision of this court or the High Court. Therefore, a circular which is contrary to the statutory provisions has really no existence in law.
to lay content with the circular would mean that the valuable right of challenge would be denied to him and there would be no scope for adjudication by the High Court or the Supreme Court. That would be against very concept of majesty of law declared by Supreme Court and the binding effect in terms of Article 141 of the Constitution”
Therefore, it is clarified that Board Circulars contrary to the judgements of Hon’ble Supreme Court become non-est. in law and should not be followed.
The above direction would also apply to the judgements of Hon’ble High Court where Board has decided that no appeal would be filed on merit. However where appeal has been filed by revenue against the High Court’s order, pending adjudication should be transferred to the Call-Book and such appeals should be kept alive.