Exemption computation for nil-duty clearances required exclusion of exempt goods, leaving no surviving duty demand.

Revised classification of rubber products, together with the agreed application of Notifications Nos. 175/86 and 1/93, left no surviving duty demand. The Tribunal held that clearances of goods chargeable at nil duty had to be excluded while computing exemption eligibility, and only the dutiable cellular goods were relevant for the threshold. On that basis, the remaining taxable value stayed below the exemption limit. It further held that consequential relief under the revised classification and notifications could not be denied merely because it had not been separately quantified at the earlier stage.

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Issues: Whether, after the agreed revised classification of the rubber products and the agreed applicability of Notifications Nos. 175/86 and 1/93, any duty demand survived against the appellants.

Analysis: The classification dispute had been resolved on the basis of agreed facts, and the parties were also in agreement that the non-cellular goods attracted nil rate of duty. The Tribunal held that, for computing eligibility under the exemption notifications, the value of clearances of goods chargeable to nil duty had to be excluded. On that basis, the value attributable to the dutiable cellular goods alone remained below the exemption threshold. The Tribunal further held that the consequential relief flowing from the revised classification and the notifications could not be denied merely because it was not separately worked out at the earlier stage.

Conclusion: No amount remained demandable after applying the revised classification and the exemption notifications, and the appeals were accepted in favour of the appellants.

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