Exemption notifications must be read on their own terms; DEPB imports were not liable to Special Additional Duty.

Goods imported under the DEPB Scheme were treated as eligible for exemption from Special Additional Duty under Notification No. 34/98-Cus., because that notification operated on its own terms and expressly covered goods imported under Notification No. 34/97-Cus. The conditions attached to Notification No. 34/97-Cus. could not be read into the later SAD exemption notification unless expressly incorporated. Subsequent notifications, including Notifications No. 48/98-Cus. and No. 56/98-Cus., reinforced that such goods were not liable to SAD. The demand to debit Special Additional Duty in the DEPB was therefore not sustainable.

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Issues: Whether goods imported under the DEPB Scheme were entitled to exemption from Special Additional Duty under Notification No. 34/98-Cus. and whether the conditions of Notification No. 34/97-Cus. could be read into that exemption.

Analysis: Notification No. 34/97-Cus. governed the DEPB Scheme and required debit only for basic customs duty and additional duty under Section 3 of the Customs Tariff Act, 1975. The later exemption Notification No. 34/98-Cus. specifically covered goods imported under Notification No. 34/97-Cus. and exempted them from Special Additional Duty. The later notifications, including Notifications No. 48/98-Cus. and No. 56/98-Cus., clarified that such goods were not liable to SAD, and the conditions of Notification No. 34/97-Cus. could not be imported into the SAD exemption notification.

Conclusion: The exemption from Special Additional Duty was available to the imported goods, and the demand for debit of SAD in the DEPB was not sustainable.

Ratio Decidendi: An exemption notification must be construed according to its own terms, and conditions attached to a separate notification cannot be engrafted into it unless expressly incorporated.

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