Binding circulars and limited remand require strict compliance; later circular applied on facts could not be displaced by an earlier one.

A subordinate quasi-judicial authority must act within the scope of a limited remand and apply the binding departmental circular found applicable on the facts. After accepting that the goods fell within the later circular dated 5 December 1994, the authority could not revert to the earlier circular dated 31 May 1990 or expand the remand by treating the matter under a different regime. The court affirmed that departmental circulars bind the adjudicating authority and that the operative circular is the one governing the decision-making exercise. The impugned order was quashed to the extent it relied on the earlier circular despite acceptance of the later one.

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Issues: Whether the appellate authority could go beyond the limited remand and rely on the earlier circular dated 31 May 1990 after finding that the goods were governed by the later circular dated 5 December 1994.

Analysis: The remand by the Tribunal was confined to examining the exact nature of the goods with reference to the later circular. Once the authority found, on facts, that the product fell within the later circular, it was bound to apply that circular and could not expand the scope of the remand by reverting to the earlier circular. The binding effect of departmental circulars and the duty of subordinate quasi-judicial authorities to follow superior directions were affirmed, and the contention that the assessee should be relegated to a further statutory appeal was rejected. The plea that the later circular could not govern pending proceedings was not accepted because adjudication had to proceed on the circular in force when the authority decided the matter.

Conclusion: The authority acted beyond the remand in applying the earlier circular and denying relief despite accepting the applicability of the later circular; the impugned order was quashed to that extent.

Ratio Decidendi: A subordinate quasi-judicial authority must strictly comply with the terms of remand and, where a binding circular is found applicable on facts, cannot disregard it by resorting to an earlier inconsistent circular.

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