Excise exemption follows the date of manufacture, and refund cannot be denied merely because clearance occurred after withdrawal.

Goods manufactured while an exemption notification was in force remained eligible for the exemption even if cleared after the notification was withdrawn. The governing principle applied was that excise duty is attracted at the stage of manufacture, while collection at removal is only for administrative convenience; therefore, the relevant date for exemption was the date of manufacture, not the date of clearance. On that basis, a refund claim could not be rejected solely because the goods were removed after withdrawal of the notification, though refund entitlement remained subject to scrutiny under the doctrine of unjust enrichment.

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Issues: Whether excisable goods manufactured during the currency of an exemption notification but cleared after its withdrawal continued to qualify for exemption and refund of duty paid at the time of clearance.

Analysis: The goods were manufactured when the exemption notification was in force and were later cleared after the notification had been withdrawn. The decision turned on whether the relevant point for levy and exemption was the date of manufacture or the date of removal. The ruling applied the principle that excise duty is attracted by manufacture, while collection at the stage of removal is only for administrative convenience. On that basis, goods already manufactured during the exempted period could not be denied the benefit of the exemption merely because they were cleared after withdrawal of the notification. The entitlement to refund was, however, made subject to scrutiny under the doctrine of unjust enrichment.

Conclusion: The goods manufactured during the exempted period were eligible for the exemption, and the refund claim could not be rejected solely because clearance took place after withdrawal of the notification.

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