Exemption option in classification list treated as sufficient; separate letter not mandatory, so denial of benefit was unsustainable.

Exemption under Notification No. 38/97 could not be denied solely because a separate letter of option was not filed, where the assessee had already declared its intention in the classification list under Rule 173B. The declaration contained the necessary particulars and satisfied the requirement of exercising the option in writing. As the notification did not prescribe any special format for the option and did not require a separate declaration in the proforma contemplated under Rule 233, the omission of a standalone letter was treated as a procedural lapse. On that basis, denial of the exemption was held to be unsustainable.

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Issues: Whether exemption under Notification No. 38/97 could be denied merely because a separate letter of option was not filed, when the assessee had already made a declaration in the classification list under Rule 173B.

Analysis: The declaration filed in the classification list contained the necessary particulars and indicated the intention to avail the benefit of the notification. The notification required an option to be exercised in writing, but it did not prescribe any special format for expressing that option. The notification also did not incorporate any additional requirement to file a declaration in a prescribed proforma under Rule 233. In these circumstances, the absence of a separate letter was treated as a procedural lapse that did not justify denial of the exemption.

Conclusion: The denial of exemption was not sustainable and the appeal was rejected.

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