Small scale industry exemption upheld where unchallenged remand finding on turnover bound later proceedings and confirmed eligibility.

The assessee's entitlement to small scale industry exemption under Notification No. 175/86-C.E. turned on an earlier remand finding that clearances for 1987-88 had not exceeded Rs. 7.5 lakhs. That finding was categorical, was not challenged by the Revenue, and operated as the final fact-finding determination, so it could not be reopened in de novo adjudication. On that basis, the assessee satisfied the first condition for SSI benefit for 1987-88 and thereby also the corresponding requirement for 1988-89. As the Revenue did not dispute the remaining turnover conditions for 1988-89, the exemption was available for both years and the denial of benefit failed.

---

---

Issues: Whether the assessee was entitled to small scale industry exemption under Notification No. 175/86-C.E. for the relevant years, and whether the finding recorded in the earlier remand order that the clearances for 1987-88 had not exceeded Rs. 7.5 lakhs bound the authorities in the subsequent proceedings.

Analysis: The earlier remand order had recorded a categorical finding that the assessee's clearances for 1987-88 had not exceeded Rs. 7.5 lakhs. That finding was not challenged by the Revenue and, as the final fact-finding determination on the point, it could not be reopened in de novo adjudication. On that basis, the assessee satisfied the first condition for SSI benefit for 1987-88 and thereby also fulfilled one of the conditions for the next year. The Revenue did not dispute that the remaining turnover conditions for 1988-89 were met.

Conclusion: The assessee was entitled to SSI exemption for both years, and the Revenue's challenge failed.

Final Conclusion: The denial of exemption was set aside in substance, and the assessee's entitlement to the benefit under the notification stood confirmed.

---