Exemption for oxide of iron pigments upheld where proviso conditions were independent and binding agent limits were not breached.

Exemption for oxide of iron pigments under Notification No. 114/1973 depended on three independent conditions, and the presence of an excisable good as a binding agent did not, by itself, defeat the concession. The Court held that the proviso could not be read so that the third condition overrode the first; each clause operated separately, and the reference to excisable goods in the third clause was distinct from the binding-agent restriction in the first. As the respondents had stated that the product contained no binding agent beyond the permitted limit and the Department produced no material to the contrary, the exemption was available and the Revenue's challenge failed.

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Issues: Whether the respondents were entitled to exemption under Notification No. 114/1973 dated 30.04.1973 in respect of oxide of iron pigments, and whether the presence of an excisable good as a binding agent would by itself defeat the exemption.

Analysis: The Notification granted exemption to oxide of iron pigments subject to three independent conditions. The respondents had stated in their classification list that the product did not contain binding agent in excess of 4% by weight, and the Department did not adduce material to show otherwise. The attempt to read the third condition as overriding the first was rejected, as the clauses of the proviso were treated as independent and the expression relating to excisable goods in the third clause was understood as distinct from the binding agent covered by the first clause.

Conclusion: The respondents were entitled to the benefit of the exemption notification, and the challenge by the Revenue failed.

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