Government of India
Ministry of Finance, Dept. of Revenue
Central Board of Excise and Customs
New Delhi
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Circular No. 1006/13/2015-CX
dated the 21th September,2015
To
Principal Chief Commissioner / Chief Commissioner of Central Excise, Service Tax
and Customs (All),
Principal Commissioner of Central Excise, Service Tax and Customs (holding
charge of Chief Commissioner) (All),
Web-master, CBEC
Madam/sir,
Subject: - Clarification regarding binding nature of circular and
instructions.
A large number of judgements have been delivered by the Honble Supreme Court
on various aspects of Central Excise, Service Tax or Customs consequent upon the
constitution of special bench on 28.02.2015 to expeditiously decide appeals in
Indirect taxes. However, there may be Board circulars on some of these issues
which are contrary to the judgement delivered by Honble Supreme Court. The issue
is whether the field officers are bound by such circulars, during the period the
circular has not been rescinded.
- In this regard, attention is invited to the judgement of Honble Supreme
Court dated 14th October 2008 [2008 (231) E.L.T.22(SC)/2008-TIOL-104-SC-CX-CB] in
case of M/s Ratan Melting & Wire Industries Vs Commissioner of Central Excise,
Bolpur. In the said judgement Honble Supreme Court has held at para 6 & 7 that-
"6.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. So far as the clarification/circulars issued by the central Government
and of the state Government are concerned they represent merely their
understanding of the statutory provisions. They are not binding upon the court.
It is for the court to declare what the particular provision of statute says and
it is not for the Executive. Looked at from other angle, a circular which is
contrary to the statutory provisions has really no existence in law...
7
.. 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
Honble Supreme Court become non-est in law and should not be followed. Reference
of such circulars should be made to the Board so that further action of
rescinding these circulars can be expeditiously taken up. Board may also
initiate such action suo-moto. All pending cases on the issue, including those
in the Call-Book, decided after the date of the judgement should, conform to the
law laid by the Honble Supreme Court or High Court, as the case may be,
irrespective of whether the circular has been rescinded or not.
- The above direction would also apply to the judgements of Honble 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 Courts order, pending
adjudication should be transferred to the Call-Book and such appeals should be
kept alive.
- Difficulty experienced, if any, in implementing the circular should be
brought to the notice of the Board. Hindi version would follow.
F.No.96/90/2015-CX.1
(Santosh Kumar Mishra)
Under Secretary to the Government of India
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