Beneficial tax circulars bind the revenue and can apply in pending revision proceedings despite earlier assessment years.

An administrative circular issued under the sales tax framework, after consultation with the Law Department, relaxed the requirement of producing certificates to prove end-use of goods. The analysis treats such a beneficial circular as binding on revenue authorities even if the department considers it erroneous, because the revenue cannot adopt a contrary stand against the assessee. It also states that the benefit of a benevolent circular issued during pending revision proceedings cannot be denied merely because the relevant assessment years predated the circular, where the revisions formed part of a continuing chain of proceedings.

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Issues: Whether a circular issued by the Sales Tax Commissioner in consultation with the Law Department, relaxing the requirement of producing certificates to prove end-use of goods, was binding on the department and could be applied in pending revision proceedings relating to earlier assessment years.

Analysis: The circular was issued under the rule-making framework governing the Act and reflected the Law Department's view that a selling dealer, after sale of goods, has no control over their subsequent use. It removed the practical burden of proving that the goods were actually used for manufacture of brassware, and the interpretation adopted was treated as reasonable and beneficial to dealers. The principle applied was that an administrative circular, even if erroneous, binds the revenue authorities so long as it is beneficial to the assessee, and the department cannot take a contrary stand. As the revisions were part of a continuing chain of proceedings, the benefit of a benevolent circular issued during pendency could not be denied merely because the assessment years preceded the circular.

Conclusion: The circular was held binding on the department and applicable to the pending revisions, so the department could not insist on proof contrary to the circular; the revisions were dismissed, resulting in relief to the assessee.

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