Exemption notification benefit cannot be denied for later registration when disclosure was made and no registration applies.

An exemption or concessional duty notification cannot be denied merely because registration was obtained later when the notification does not make registration a condition, the assessee had already disclosed the manufacturing activity, and the record showed bona fide conduct. In this matter, the appellant had filed the relevant declaration for unbranded chewing tobacco, sought clarification on the new levy, obtained registration after departmental visit, and paid duty at the applicable concessional rate. On that basis, denial of notification benefit was found unwarranted, and the demand beyond the duty already paid, along with penalties on the firm and proprietor, was set aside.

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Issues: Whether the appellant was entitled to the benefit of Notification No. 6/2005-C.E. dated 01.03.2005 and whether the demand of duty and penalties could be sustained.

Analysis: The appellant had already filed the declaration for availing Notification No. 8/2003-C.E. in respect of unbranded chewing tobacco and was not suppressing the nature of manufacture from the department. The appellant had also sought clarification regarding the applicability of the new levy and, upon clarification during departmental visit, obtained registration and paid duty at the effective rate under Notification No. 6/2005-C.E. The notification did not prescribe registration as a condition for availing its benefit. In these circumstances, denial of the notification benefit and reliance on the cited precedent were held to be inapposite.

Conclusion: The demand in excess of the duty already paid under Notification No. 6/2005-C.E. was set aside and the penalties on the appellant firm and the proprietor were also set aside.

Ratio Decidendi: Where an exemption or concessional duty notification does not make registration a condition, the benefit cannot be denied merely because registration was taken subsequently, especially when the assessee had disclosed the activity and acted under bona fide belief.

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