The Scottish FA had issued Lennon with a four-game sanction at a period when he was already serving a similar punishment. Celtic successfully argued that there was no specification within association guidelines that the bans should run consecutively rather than concurrently. As a result, Lennon will serve a five rather than eight-game dug-out ban.
The governing body said: "The Scottish FA has received independent counsel advice on this point and regrettably has been advised that its interpretation of the rule is legally unenforceable. As such, the club have been notified that Lennon can return to the dug-out on 9 April 2011."
Stewart Regan, the Scottish FA's chief executive, plans to update legislation relating to points such as these. He said: "With regard to the timing of the suspension we must accept that, if our rules cannot be enforced in a court of law, then they cannot be imposed and it is foolish to waste money defending such a point.
"We acknowledge that our rules do need updating and I have proposed to our board that we commission a complete rewrite of the disciplinary procedures from a legal perspective to address this whole matter."
In what is the latest chapter of ongoing drama between Celtic – who had hired a QC to take on their case – and the SFA, the club replied: "We note the lengthy statement issued today by the SFA in connection with the very straightforward issue of Neil Lennon's suspension running consecutively or concurrently.
"We are pleased that the SFA has recognised that Celtic's position is absolutely correct.
"It should not have been necessary for Celtic Football Club to involve our lawyers in this simple matter and we would have much preferred not to have had to do so.
"But it is vital that the SFA properly applies the rules that it imposes, whatever those happen to be. The SFA cannot operate above the law or its own rules.
"A full review of the SFA disciplinary procedures is clearly required and we note that the SFA are addressing this matter. We are supportive of this and hope that legal interventions will not be necessary in the future.
"We will continue to protect the interests of Celtic and fairness and, as a member club, hold the SFA to account if required."
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