Customs exemption for packing materials was upheld where the notification expressly covered them and a different excise precedent did not apply.

Packing materials such as paper board boxes and paper trays used for exporting leather wallets fell within Customs Notification No. 81/95 because the notification expressly included packing materials and did not exclude goods imported for use in the export order. A precedent under Central Excise Notification No. 119/75-C.E. could not control interpretation of the independent customs notification because it arose in a different statutory context involving job work by small-scale manufacturers. The denial of exemption on that basis was therefore unsustainable, and the orders refusing benefit were set aside.

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Issues: Whether packing materials such as paper board boxes and paper trays used for exporting leather wallets were covered by Customs Notification No. 81/95 and whether the decision rendered under Central Excise Notification No. 119/75-C.E. barred grant of the customs exemption.

Analysis: The notification expressly included packing materials within the definition of goods eligible for exemption, and nothing in its terms excluded the packing materials imported for use in the export order. The earlier Supreme Court decision relied upon below was rendered in the context of Central Excise Notification No. 119/75-C.E., dealing with job work by small-scale manufacturers, and was therefore not governing for interpretation of the independent customs notification. Since the Commissioner (Appeals) had already found the notification applicable to the packing materials, the denial of benefit based on the distinguishable precedent was unsustainable.

Conclusion: The packing materials were eligible for the benefit of Customs Notification No. 81/95, and the reliance on the cited Central Excise precedent was misplaced.

Final Conclusion: The orders denying exemption were set aside and the appeals succeeded.

Ratio Decidendi: Where an exemption notification expressly covers packing materials, benefit cannot be denied by importing a precedent rendered under a different notification with a distinct statutory context.

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