Exemption claims based on transporter declarations need fresh scrutiny when originals are later produced and hearing is granted.

Exemption under Notification No. 32/2004-ST was questioned because the assessee initially produced only notarised photocopies of transporter declarations confirming that no CENVAT credit or benefit under Notification No. 12/03-ST had been taken. As the originals were later produced before CESTAT, the rejection of the claim on that ground alone was not sustained. The appellate authority was expected to call for the originals before disallowing the exemption, and the matter was remitted for fresh examination with reasonable opportunity of hearing to the assessee.

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Issues: Whether denial of exemption under Notification No. 32/2004-ST on the ground of non-production of original declarations from transporters was justified, and whether the matter required reconsideration on the basis of the originals produced before the Tribunal.

Analysis: The exemption was rejected because the assessees had produced only photocopies of declarations from the transporters stating that they had not availed CENVAT credit and had not taken the benefit of Notification No. 12/03-ST. The declarations were notarized, and the originals were subsequently produced before the Tribunal. In such circumstances, the lower appellate authority ought to have called for the originals before rejecting the claim, and the issue required fresh examination with due opportunity of hearing.

Conclusion: The denial of exemption was not sustained, and the matter was remitted to the lower appellate authority for reconsideration after affording reasonable opportunity to the assessee.

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