Clarificatory exemption amendment for servers treated as retrospective, preserving computer exemption eligibility under the notification.

Servers imported under heading 84.71 were treated as computers for the purposes of exemption under Notification No. 6/2002-C.E., because the exemption entry used the broad description "computer" and the earlier amendment affected only valuation, not eligibility. The later explanation inserted on 09-07-2004, stating that computer includes a separately cleared CPU, was regarded as clarificatory rather than creating a new benefit. As a result, the explanation was taken to operate retrospectively and could not be relied on to deny exemption for earlier clearances.

---

---

Issues: Whether servers imported under heading 84.71 were entitled to exemption under Notification No. 6/2002-C.E., and whether the later explanation inserted by Notification No. 23/2004-C.E. was merely clarificatory so as to apply retrospectively.

Analysis: The description in the exemption entry was "computer", while the earlier amendment under Notification No. 2/2004-C.E. altered only the valuation aspect and did not narrow the class of eligible goods. The imported item was a server, which was treated as a computer and fell under heading 84.71. The later explanation inserted on 09-07-2004, stating that computer includes CPU cleared separately, was viewed as clarificatory because it explained the original scope of the exemption rather than creating a new benefit. On that basis, the subsequent amendment could not be used to deny exemption for clearances made earlier.

Conclusion: The servers were eligible for the exemption under Notification No. 6/2002-C.E., and the clarificatory amendment operated retrospectively; the denial of the exemption was unsustainable.

---