Exemption under competing notifications depends on same manufacturer identity; a dissolved firm's successor could claim the later benefit.

A dissolved partnership firm ceasing to exist and a distinct legal entity taking over manufacture was treated as a change in legal identity, not a mere change in registration. On that basis, the bar in Notification No. 138/86 against a manufacturer availing Notification No. 175/86 did not apply, because the prohibition was aimed at simultaneous or concurrent availment by the same manufacturer. The reference to conditions in Notification No. 175/86 was held irrelevant on the facts stated. The assessee was therefore entitled to exemption under Notification No. 138/86, and denial of the benefit was not sustainable.

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Issues: Whether, after dissolution of the partnership firm and takeover of the business by a different legal entity, the assessee could claim exemption under Notification No. 138/86 despite earlier availing benefit under Notification No. 175/86.

Analysis: Dissolution of the partnership resulted in the firm ceasing to exist, and the subsequent manufacture was carried on by the new entity. The situation was therefore not a mere change in registration but a change in legal identity. The prohibition in Notification No. 138/86 against a manufacturer availing exemption under Notification No. 175/86 was directed against simultaneous or concurrent availment by the same manufacturer, which was not the case here. The reference to the conditions in Notification No. 175/86 was held to be irrelevant to the dispute.

Conclusion: The assessee was entitled to the exemption under Notification No. 138/86, and the denial of benefit was not sustainable.

Final Conclusion: The order of the appellate authority was set aside and the assessee's claim to exemption was restored.

Ratio Decidendi: Where a partnership firm has ceased to exist and a distinct legal entity carries on the business, the bar on availing two exemption notifications simultaneously does not apply unless the same manufacturer claims both benefits at the same time.

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