Exemption notification conditions must be fully satisfied; mistaken grant of duty relief may be revised when rules permit correction.

An exemption under Notification No. 25/70 applied only if every condition was satisfied in full. The authorities were entitled to examine whether the product was in fact a mixed fertiliser made from fertilisers on which duty had already been paid, and the remand order did not finally decide that all notification requirements were met; exemption was therefore denied because the product did not satisfy the conditions. The Assistant Collector also had jurisdiction to revise the earlier grant of exemption after remand, since the order could be corrected if contrary to law, notice had been issued, and the governing rule permitted modification of duty where valid reasons existed. The principle of functus officio did not bar the correction.

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Issues: (i) Whether the appellant's product qualified for exemption under Notification No. 25/70 as a mixed fertiliser manufactured from two or more fertilisers on which duty had already been paid; (ii) Whether the Assistant Collector lacked jurisdiction to reopen the earlier order and revise the grant of exemption after the remand.

Issue (i): Whether the appellant's product qualified for exemption under Notification No. 25/70 as a mixed fertiliser manufactured from two or more fertilisers on which duty had already been paid.

Analysis: The exemption notification required satisfaction of all its conditions. The remand order of the Government of India dealt only with the effect of chemical reaction during mixing and did not finally decide that every condition of the notification stood fulfilled. The authorities were therefore entitled to examine whether the product was in fact a mixture of fertilisers alone and whether the other requisite conditions were met. The decision in Coromandal Fertilisers supported the view that ammonia was not a fertiliser for this purpose, and the appellant's product did not satisfy the notification conditions.

Conclusion: The appellant was not entitled to exemption under the notification.

Issue (ii): Whether the Assistant Collector lacked jurisdiction to reopen the earlier order and revise the grant of exemption after the remand.

Analysis: The earlier order granting exemption was made pursuant to the remand and could be corrected if it was contrary to law. Rule 173B(5) authorised modification where the rate of duty had to be altered for valid reasons. The Assistant Collector had issued notice before revising the earlier order, and the principle of functus officio did not bar such correction in the circumstances.

Conclusion: The Assistant Collector had jurisdiction to revise the earlier order.

Final Conclusion: The appeals failed because the product did not satisfy the exemption notification and the departmental authorities were competent to correct the earlier mistaken grant of exemption.

Ratio Decidendi: An exemption notification must be satisfied in full, and a mistaken grant of exemption may be corrected by the proper excise authority where the governing rules permit modification of the rate of duty.

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