Duty-paid scrap excluded from SSI clearance aggregation, preserving exemption eligibility under the notification.

Goods cleared on payment of full tariff duty under an SSI exemption notification are outside the category of specified goods for computing aggregate clearances. Duty-paid waste and scrap of copper therefore could not be clubbed with clearances of copper winding wires to determine eligibility under Notification No. 1/93. Once the scrap had suffered tariff duty, its value could not be counted again to deny the small scale exemption to the remaining clearances. The notification remained available because only exempted or specified goods cleared under the scheme were relevant for the aggregation test.

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Issues: Whether the value of waste and scrap of copper cleared on payment of normal tariff duty was required to be included in the aggregate value of clearances for determining eligibility to the small scale exemption under Notification No. 1/93.

Analysis: The exemption notification treated as "specified goods" only those excisable goods described in the annexure and cleared for home consumption in the relevant financial year under the exemption scheme. Goods cleared on payment of full tariff duty did not satisfy the requirement of being exempted goods under the notification. The value of duty-paid waste and scrap therefore could not be clubbed with the value of copper winding wires for crossing the exemption slab. Once duty had been discharged on the scrap at tariff rate, its turnover could not again be used to deny the benefit of the notification to the other clearances.

Conclusion: The value of waste and scrap cleared at normal duty rate was not includible in the aggregate value of clearances for the SSI exemption, and the benefit of the notification remained available to the assessee.

Ratio Decidendi: Goods cleared on payment of full tariff duty under an SSI exemption notification are outside the category of "specified goods" for computing the aggregate value of exempt clearances.

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