2005 (10) TMI 94 - SC - Central Excise

Departmental clarification - Held that - this case will be covered by judgment in 2005 (2) TMI 138 - SUPREME COURT OF INDIA . However, on the limited aspect as to whether or not the circular of the Board can prevail, we also tag this matter along with those cases which are pending before the Constitution Bench. If ultimately it is held by the Constitution Bench that judgments of this Court would prevail then this appeal would stand dismissed. If however the Constitution Bench takes a contrary view, then of course the reverse will follow. In either case there will be order as to costs.

Summary

Issues:
1. Interpretation of whether a circular issued by the Board would prevail over the judgment of the Supreme Court.
2. Whether the appellants are entitled to exemption under a Notification based on a new point raised.

Analysis:

Issue 1: Interpretation of Circular vs. Judgment
The Supreme Court, in a matter tagged with Civil Appeal No. 3197 of 2000, clarified the issue of whether a circular issued by the Board would prevail over the judgment of the Court. The Court acknowledged a Circular of the Board dated 27th October, 1994, which presented an interpretation consistent with the arguments made before the Court. Recognizing a divergence of opinion on this matter, the Court referred the question to a Constitution Bench for resolution. The Court emphasized that the tagging of matters with the Constitution Bench was solely to determine the hierarchy between Circulars and Judgments. The outcome of the Constitution Bench's decision would dictate the fate of the appeals, with dismissal or allowance based on the prevailing authority.

Issue 2: Entitlement to Exemption under Notification
The Court addressed a new point raised regarding the appellants' entitlement to exemption under a Notification based on a proviso. However, the Court noted that this point was not previously raised during the proceedings and was not part of the Special Leave Petition. The Court emphasized that such new points, requiring a mix of law and factual determinations, cannot be introduced for the first time at later stages of the case. Consequently, the Court did not permit the new point to be raised, highlighting the importance of adhering to procedural requirements and raising all relevant arguments in a timely manner to ensure a fair and orderly legal process.