Exempt clearance computation under exemption notification: newsprint clearances excluded from the first-clearance limit.

Exempted newsprint clearances were not to be counted while computing the first-clearance limit of 210 MTs for exemption under Notification No. 6/2000-C.E. The exemption operated on an aggregate quantity not exceeding 210 MTs during the specified period, and the Board's circular clarifying the notification stated that duty-exempt paper clearances were excluded from that computation. As the circular was binding on the Revenue, the excluded newsprint could not be included in the eligible first clearance. The resulting duty demand was therefore unsustainable and was set aside.

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Issues: Whether clearances of exempted newsprint were includible in computing the first clearance of 210 MTs of paper for availing exemption under Notification No. 6/2000-C.E. dated 1-3-2000.

Analysis: The exemption notification granted relief up to the first clearance of an aggregate quantity not exceeding 210 MTs during the specified period. The Board's circular clarifying the notification stated that clearances of paper exempted from duty were not to be included in the computation of the first clearance of 210 MTs. Since the circular is binding on the Revenue, the exempted newsprint clearances had to be excluded while computing the eligible first clearance.

Conclusion: The excluded newsprint clearances were not includible in the aggregate quantity of 210 MTs and the demand was unsustainable.

Final Conclusion: The appeal succeeded and the duty demand was set aside on the basis that exempted clearances could not be counted for the first-clearance limit under the notification.

Ratio Decidendi: A binding departmental circular clarifying an exemption notification governs the computation of the exemption limit, and exempt clearances cannot be included in the aggregate for determining the first-clearance threshold.

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