FOB value of exports includes DTA clearances by a 100% EOU, preserving exemption eligibility under the notification.

DTA clearances by a 100% Export Oriented Unit were treated as includible in the FOB value of exports for exemption under Notification No. 2/95-CE, because earlier binding decisions had already held that deemed export value could not be excluded where the clearances were made under the applicable policy and notifications. The Gujarat HC followed its prior ruling on the same question and rejected the contrary view relied on by the Revenue, holding that it did not displace the binding precedent. The exemption claim therefore remained available to the assessee and the Revenue's challenge failed.

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Issues: Whether DTA clearances by a 100% Export Oriented Unit could be included in the Free on Board value of exports for availing the exemption benefit under Notification No. 2/95-CE dated 04.01.1995.

Analysis: The dispute was covered by earlier decisions holding that, for the relevant export incentive scheme, deemed export value could not be excluded from the FOB value of exports where the clearances were made by a 100% EOU in the manner permitted under the prevailing policy and notifications. The Court also noted that its own earlier decision on the same issue had already rejected the Revenue's contention, and that the contrary view relied upon by the Revenue did not displace that binding view. Following the earlier decision, the challenge to the allowance of exemption could not succeed.

Conclusion: The issue was answered in favour of the assessee. The Revenue's appeal failed.

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