Exemption notification options apply only to covered goods; Modvat credit on excluded branded goods does not bar relief.

An exemption notification offering alternative modes of relief can be used only for goods within its scope; where goods bearing another person's brand name are excluded, availing Modvat credit on those goods does not amount to an impermissible simultaneous claim of exemption and credit. The earlier ruling cited was distinguishable because it concerned different options applied to different eligible goods. On that basis, denial of exemption was unwarranted and the benefit granted by the appellate authority was left undisturbed.

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Issues: Whether a manufacturer can be denied exemption under Notification No. 1/93-C.E. on the ground that it availed Modvat credit for goods bearing the brand name of another person, where such goods were in any event outside the exemption.

Analysis: Notification No. 1/93-C.E. offered alternative modes of exemption, but the option operated only in respect of goods to which the notification applied. Goods bearing another person's brand name were excluded from the notification, so the question of electing between full exemption and Modvat-based partial exemption did not arise for those goods. The earlier decision relied upon concerned a different situation, where the manufacturer sought to apply different options to different eligible goods, and was therefore inapplicable.

Conclusion: The denial of exemption was unwarranted, and the assessee was entitled to the benefit granted by the appellate authority.

Final Conclusion: The appeal failed and the order in favour of the assessee was left undisturbed.

Ratio Decidendi: The option under an exemption notification can be exercised only for goods covered by that notification; where goods are excluded from its scope, availing Modvat credit on those goods does not amount to an impermissible simultaneous claim of exemption and credit.

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