Input credit under Notification No. 29/96 was allowed for export-made ups not specifically listed, based on the plain wording.

Notification No. 29/96 was construed to permit credit of declared duty on grey fabrics used as inputs when the processed fabrics were used to make made-up articles exported under bond. The proviso to clause 3 allowed such input credit to be utilised toward duty on final products cleared for home consumption or for export on payment of duty, and that entitlement was not confined to final products specifically named in the notification. The attempted departmental restriction was found inconsistent with the plain wording of the provision, so the credit was treated as admissible.

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Issues: Whether credit of declared duty on grey fabrics used as inputs could be utilised under Notification No. 29/96 dated 03-09-1996 when the processed fabrics were used in the manufacture of made-up articles exported under bond, although the exported made-ups were not specified final products under the notification.

Analysis: The proviso to clause 3 of Notification No. 29/96 allowed credit of declared duty on inputs used in final products cleared for export under bond to be utilised towards payment of duty on any final products cleared for home consumption or for export on payment of duty. The restriction sought to be read by the department, namely that such credit would be available only if the export related to a final product specifically mentioned in the notification, was held to be inconsistent with the plain language of the provision. The notification was construed according to its clear terms, and the credit was treated as admissible.

Conclusion: The appellants were entitled to the credit claimed and the appeals succeeded.

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