Strict construction of export duty exemption defeated claim where test reports and sampling doubts left Fe content unproven.

Concessional export duty under Notification No. 62/2007-Customs depended on reliable proof of the Fe content in iron ore fines, including whether it had to be measured on a wet basis for exemption eligibility. Three test reports were considered, but the CRCL report did not specify wet or dry basis, while the other reports indicated a lower Fe content. The record also raised doubts about the authenticity and representative nature of samples drawn outside the presence of all concerned parties. Applying the principle that exemption notifications are to be strictly construed, any ambiguity was treated against the assessee, and the exemption was not established.

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Issues: Whether the exporter was entitled to the concessional export duty under Notification No. 62/2007-Customs on the basis of the available test reports, and whether the Fe content of iron ore fines had to be determined on wet basis for deciding the eligibility to exemption.

Analysis: Three test reports were available, namely the CRCL report, the report of the accredited testing agency at the load port, and the report of the Chinese authorities at the destination port. The CRCL report did not specify whether the Fe content was on wet basis or dry basis, while the other two reports indicated a lower Fe content. The decision also noted doubts regarding the authenticity and representative character of the samples drawn outside the presence of all concerned parties. In light of the later legal position that exemption notifications must be strictly construed, any ambiguity or benefit of doubt in such matters must go to the Revenue. The earlier contrary view was not accepted on the facts and law applicable to the case.

Conclusion: The exemption was held not established in favour of the assessee and the duty demand was sustained in favour of the Revenue.

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