SSI exemption for re-imported goods applies when clearances stay within the exempted regime, barring excise duty.

Where the record showed that the assessee's clearances for the relevant financial year remained below the SSI threshold and the exemption under Notification No. 8/2003-C.E. was in force, re-imported goods cleared in the domestic market were treated as falling within the exempted regime. On that basis, excise duty was not payable on those goods. The stated principle is that once eligibility for a statutory exemption is established for the relevant period, the exemption must be applied to the goods covered by that regime in accordance with law.

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Issues: Whether the assessee was entitled to the Small Scale Industry exemption under Notification No. 8/2003-C.E. in respect of re-imported goods cleared in the domestic market, and whether excise duty was payable on such goods.

Analysis: The certificate issued by the Superintendent of Central Excise showed that for the financial year 2003-04 the assessee's total clearances were below the prescribed limit and that the assessee was operating under the exemption. On that basis, the re-imported goods were treated as goods cleared within the exempted regime. The cited authorities were relied upon for the proposition that a statutory exemption, once applicable, must be extended in accordance with law.

Conclusion: The assessee was entitled to the exemption and was not liable to pay excise duty on the re-imported goods.

Ratio Decidendi: Where the record establishes eligibility for SSI exemption for the relevant financial year, re-imported goods cleared in the domestic market within that exempted regime are not liable to excise duty.

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