Exemption notifications cannot be widened by circulars, and unfinished jewellery with essential character remains taxable.

Later monetary-limit circulars were treated as administrative guidelines and not applied retrospectively to appeals already filed, so the maintainability objection was rejected. Gold findings were treated as parts of jewellery and therefore outside Notification No. 62/2004-Cus., while gold mountings, having the essential character of unfinished jewellery under Rule 2(a) of the General Rules for Interpretation, were also classifiable as gold jewellery and not covered by the exemption. Board circulars could not enlarge the scope of the statutory notification beyond its plain terms, so the exemption granted by the Commissioner was unsustainable and the duty demand with interest was restored.

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Issues: (i) Whether the Board's later monetary-limit circulars could be applied retrospectively to appeals filed earlier. (ii) Whether gold mountings and gold findings were entitled to exemption under Notification No. 62/2004-Cus., and whether the Board's circulars could enlarge the scope of that notification.

Issue (i): Whether the Board's later monetary-limit circulars could be applied retrospectively to appeals filed earlier.

Analysis: The appeals had been filed before the later circular enhancing the monetary limit. The monetary-limit instructions were treated as administrative guidelines and not as a basis for retrospectively defeating appeals already instituted. The dispute also involved recurring interpretation of an exemption notification, which supported consideration on merits.

Conclusion: The objection to maintainability was rejected.

Issue (ii): Whether gold mountings and gold findings were entitled to exemption under Notification No. 62/2004-Cus., and whether the Board's circulars could enlarge the scope of that notification.

Analysis: The notification exempted gold in any form but expressly excluded jewellery made of gold or silver. Gold findings were treated as parts of jewellery and therefore outside the notification. Gold mountings were found to have the essential character of unfinished jewellery, since they were presented in shapes meant to be completed by setting stones and, applying Rule 2(a) of the General Rules for Interpretation, were classifiable as gold jewellery. Since exemption depends on the statutory notification, Board circulars could not expand its scope beyond the notification's plain terms. Clarifications contrary to the notification had no legal efficacy.

Conclusion: Gold mountings and gold findings were not eligible for exemption, and the Commissioner's grant of the benefit was unsustainable.

Final Conclusion: The appeals were allowed, the exemption granted by the Commissioner was set aside, and the duty demands with interest were restored.

Ratio Decidendi: An unfinished article having the essential character of jewellery is to be treated as jewellery for exemption purposes, and administrative circulars cannot enlarge the scope of a statutory exemption notification contrary to its text.

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