CBEC vide its circular No. 1006/13/2015-CX dated 21st September 2015 clarified that circular and instructions which are contrary to the judgments of Hon’ble Supreme Court become non-est in law and should not be followed. In this regard board has mention the ruling of judgment of Hon’ble Supreme Court dated 14th October 2008 [2008 (231) E.L.T. 22(SC)] in case of M/s Ratan Melting & Wire Industries Vs Commissioner of Central Excise, Bolpur. In the said judgment Hon’ble 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”
However there are various decisions of High Court and CESTAT in which circular and instructions are held void ab initio. Therefore in line with Hon’ble Supreme Court the decision of High Court and CESTAT should also consider to not follow the circular and instructions.
