Notification exemption and Modvat credit dispute remanded for fresh consideration after hearing on limitation and duty demand.

Duty demand was challenged on the ground that exemption under Notification No. 203/92 remained available despite Modvat credit having been taken in the manufacture of exported goods, and on the further plea that limitation under the proviso to section 27(1) of the Customs Act, 1962 required examination. The appeal was allowed and the impugned order was set aside, with the matter remitted to the Commissioner for fresh consideration after the appellant filed a written submission on those aspects and was granted an opportunity of hearing.

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Issues: Whether the demand of duty could be sustained on the ground that the benefit of Notification No. 203/92 was unavailable because Modvat credit had been availed of in the manufacture of exported goods, and whether the plea of limitation under the proviso to section 27(1) of the Customs Act, 1962 required consideration.

Outcome: The appeal was allowed and the impugned order was set aside, with the matter left for fresh consideration by the Commissioner after the appellant made a written submission on the stated aspects and was afforded an opportunity of hearing.

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