Is the Rule superior to Notification?
In the Supreme Court judgement we are carrying today, the Supreme Court observed that primacy cannot be given to a notification over the statutory provisions of a rule. In Central Excise, an exemption Notification is issued under Section 5A of the Central Excise Act and a rule is issued under Section 37 of the Act. Both are issued by the executive government and both derive their source of strength from the same Act. Then how is one superior to the other? May be a notification issued under the authority of a rule cannot have supremacy over the rule itself, but when the rule and notification have the same status, can one dominate the other? In fact the rules are also issued by notifications.
Incidentally the Cenvat Credit Rules have a clarification for this. The explanation to Rule 3 states
Explanation.- Where the provisions of any other rule or notification provide for grant of whole or part exemption on condition of non-availability of credit of duty paid on any input or capital goods, or of service tax paid on input service, the provisions of such other rule or notification shall prevail over the provisions of these rules.