Exemption notification compliance must be examined before denial, and unconsidered eligibility findings warrant remand for fresh decision.

Exemption under Notification No. 64/88 depended on compliance with its prescribed conditions, and the Customs authorities had not examined that foundational issue before sustaining the demand. The Bombay HC held that an order cannot stand where exemption eligibility has not been determined on the material before the authority. The impugned orders were therefore set aside and the matter remanded to the Commissioner of Customs for fresh decision on whether the appellants had satisfied all conditions of the notification.

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Issues: Whether the orders of the customs authorities and the appellate tribunal could be sustained without examining compliance with the conditions of the exemption notification.

Analysis: The challenge was confined to the narrow question whether the appellants had satisfied the conditions prescribed for exemption under Notification No. 64/88. The record indicated that this issue had not been considered by the Commissioner of Customs, and the appellate order also proceeded without determining that foundational question. Since entitlement to exemption depended on fulfilment of the notification's conditions, the omission required the matter to be re-examined on the material placed before the authority.

Conclusion: The impugned orders were set aside and the matter was remanded to the Commissioner of Customs to decide afresh whether the appellants had complied with all the conditions of Notification No. 64/88.

Final Conclusion: The appeals succeeded to the extent of securing a fresh adjudication on exemption eligibility, with the earlier orders vacated and the dispute sent back for decision on merits.

Ratio Decidendi: Where exemption eligibility turns on fulfilment of the notification conditions and that issue has not been examined, the order cannot stand and the matter should be remitted for fresh determination.

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