Captive consumption and aggregate clearances excluded from exemption denial under Notification No. 1/93-CE

The Tribunal applied its earlier majority view on aggregate clearances under Explanation II to Notification No. 1/93-CE. It held that the value of inputs manufactured by the assessee and captively consumed in making the final product was not to be included in the aggregate clearances for denying the exemption benefit. On that reasoning, the assessee remained entitled to the notification benefit and the adverse order was set aside.

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Issues: Whether the value of inputs manufactured by the assessee and captively consumed in the manufacture of the final product was to be included in the aggregate clearances for the purpose of Explanation II to Notification No. 1/93-CE dated 28-2-93.

Analysis: The disputed question was treated as already covered by the Tribunal's earlier majority view in similar facts. Following that ratio, the captively consumed inputs were not to be brought into the aggregate clearances so as to deny the benefit claimed by the assessee.

Conclusion: The issue was decided in favour of the assessee and the impugned order was set aside.

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