Export exemption under Notification No. 2/95 required reconsideration after later compliance developments and fresh adjudication on remand.

Goods cleared to the domestic tariff area under Development Commissioner permission were considered against Notification No. 2/95, which extended exemption to goods exported and goods expected to be exported, subject to satisfaction of the Assistant Commissioner or Deputy Commissioner regarding the prescribed conditions. The later dropping of proceedings by the Development Commissioner, together with the appellants' improved export performance, was treated as a basis for reconsidering the demand. The impugned orders were set aside and the matter was remanded to the original adjudicating authority for fresh adjudication after granting the appellants a reasonable opportunity of hearing.

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Issues: Whether the goods cleared to the domestic tariff area under permission granted by the Development Commissioner were entitled to exemption under Notification No. 2/95, dated 04-01-1995, and whether the matter required fresh adjudication in view of the later drop of proceedings by the Development Commissioner and the improved export performance.

Analysis: The notification covered goods exported as well as goods expected to be exported, and the exemption was subject to satisfaction of the Assistant Commissioner or Deputy Commissioner regarding the prescribed conditions. In the circumstances noted by the record, the Development Commissioner had dropped the proceedings and the appellants' export performance had improved subsequently. These developments justified reconsideration of the demand and required a fresh decision by the original adjudicating authority after giving the appellants a reasonable opportunity of hearing.

Conclusion: The impugned orders were set aside and the matter was remanded for fresh adjudication, with opportunity of hearing to the appellants.

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