Conditional exemption claims require strict proof of eligibility; indirect sourcing and weak records defeat the notification benefit.

An exemption under a conditional notification is available only where the claimant strictly proves compliance with every prescribed eligibility condition. Here, the benefit depended on showing that at least two-thirds of the green leaf used or processed was purchased from growers holding not more than ten hectares under tea cultivation. The record did not establish direct procurement from eligible growers, as the leaf was routed through an intermediary and the agreement did not require the intermediary to source only from qualifying growers. Inconsistent receipts, challans and payment records also failed to correlate the purchases. The exemption claim was therefore not made out and the notification benefit was denied.

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Issues: Whether the assessee was entitled to the benefit of the exemption from additional excise duty under the notification, in view of the condition that not less than two-thirds of the green leaf used or processed had to be purchased from growers holding not more than ten hectares under tea cultivation.

Analysis: The notification granted exemption subject to a specific qualifying condition regarding the source of the green leaf. The assessee had to establish that the required proportion of green leaf was purchased directly from eligible small growers. The evidence showed that the leaf was routed through an authorised person or middleman, and the agreement did not stipulate that the intermediary would procure leaf only from growers satisfying the prescribed land-holding limit. The lower authorities also found that the receipts and challans could not be correlated and that the payment documents did not reliably establish purchase from eligible growers. Since the onus lay on the assessee to prove fulfillment of the notification conditions, the evidentiary record was insufficient.

Conclusion: The assessee was not entitled to the exemption benefit, and the denial of the notification benefit was upheld.

Final Conclusion: The appeal failed because the assessee did not establish compliance with the essential conditions for claiming the exemption.

Ratio Decidendi: A party claiming exemption under a conditional notification must strictly prove fulfillment of the prescribed eligibility conditions, and where the evidence does not establish direct compliance, the benefit cannot be granted.

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