Base clearance under excise notification includes unlicensed clearances where the text does not expressly exclude them.

Notification No. 198/76 was construed broadly for base clearance computation, so excisable goods manufactured and cleared without a Central Excise licence and outside formal excise records could still be counted where the notification did not expressly exclude them. A restrictive reading that would let non-compliance reduce the clearance base was rejected as inconsistent with the notification's scheme. The assessee's prior unlicensed clearances from September 1974 onwards were therefore required to be included, while the matter was remitted for fresh consideration of rebate entitlement and limitation, which had not been addressed in the appellate order.

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Issues: Whether, for computing base clearance under Notification No. 198/76, the value of excisable goods manufactured and cleared without a Central Excise licence and without excise records could be excluded, and whether the matter required reconsideration on rebate and limitation.

Analysis: Notification No. 198/76 was construed as a whole and not in a restricted manner confined only to accounts maintained under the Central Excise Rules, 1944. The assessee had admittedly manufactured and cleared the goods from September 1974 onwards without a licence, and those findings had attained finality. In such a situation, excluding those clearances from the base period would be inconsistent with the scheme of the notification and would unjustifiably confer a benefit on non-compliance. The notification did not prohibit reliance on other records showing such clearances for determining base clearance. At the same time, the appellate order had not dealt with the assessee's contention that, if the entire period from 1974 was taken into account, some rebate might still be available, nor with the plea of limitation.

Conclusion: The exclusion of pre-licence clearances from the base clearance computation was rejected, and the matter was remitted for fresh consideration of rebate entitlement and limitation.

Final Conclusion: The Tribunal affirmed that all relevant clearances from September 1974 onwards had to be taken into account for the notification-based computation, but sent the matter back for a fresh decision on consequential reliefs.

Ratio Decidendi: For determining eligibility under a concessionary excise notification, clearances made without licence and outside formal excise records may still be taken into account where the notification does not expressly exclude them, and a restrictive construction that rewards statutory non-compliance is impermissible.

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