Amended exemption for cotton fabrics containing polyester yarn applies when the prescribed value limit is satisfied.

Cotton fabrics containing polyester filament yarn fell within the amended exemption under Notification No. 34/84 as amended by Notification No. 94/84, because the proviso specifically extended coverage to fabrics containing polyester yarn and denied relief only where their value exceeded the prescribed limit. On the stated facts, the price list value was within that limit, so the exclusion did not apply. The denial of exemption based on the unamended proviso was incorrect, and the assessee was entitled to the exemption with consequential relief.

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Issues: Whether cotton fabrics containing polyester filament yarn were eligible for the concessional exemption under Notification No. 34/84 as amended by Notification No. 94/84, particularly in view of the amended proviso and the value restriction of Rs. 25 per sq. mt.

Analysis: The amended notification enlarged the coverage from cotton fabrics made of cotton and polyester fibre alone to fabrics containing polyester fibre, polyester yarn, or both. The exclusion clause had to be read with the amended proviso, which specifically dealt with polyester filament yarn and denied the benefit only where the value of the cotton fabrics containing such yarn exceeded Rs. 25 per sq. mt. On the facts, the value shown in the price list was within the prescribed limit. The earlier reasoning of the appellate authority proceeded on the basis of the pre-amendment proviso and therefore failed to apply the amended notification correctly.

Conclusion: The fabrics were eligible for the benefit of the amended notification and the denial of exemption was unsustainable.

Final Conclusion: The appeal succeeds and the assessee is entitled to the exemption benefit with consequential relief.

Ratio Decidendi: Where an exemption notification is amended to extend coverage to fabrics containing polyester yarn, the amended proviso must be applied as written, and eligibility cannot be denied by relying on the unamended exclusion once the value condition in the amended proviso is satisfied.

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