Exemption conditional on specified input tariff headings denied for Dobby Cards made from films outside the prescribed range.

Exemption under Notification No. 53/88 and Notification No. 14/92 was conditional on the raw material falling within tariff sub-headings 3901 to 3915. Dobby Cards made from duty-paid films classified under Heading 39.20 did not satisfy that condition, so the exemption was unavailable. The separate contention that the goods were not marketable was also rejected in view of the finding that similar Dobby Cards had previously been procured from other parties before the assessee installed its own machines. The denial of exemption was therefore sustained.

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Issues: Whether Dobby Cards manufactured out of films falling under CET sub-heading 39.20 were eligible for exemption under Sl. No. 39 of Notification No. 53/88 and Sl. No. 37 of Notification No. 14/92, where the notifications required the raw material to fall under sub-heading 3901 to 3915.

Analysis: The exemption was conditional upon the inputs used in manufacture falling within the specified tariff range of 3901 to 3915. The product in question was manufactured out of duty-paid films classified under Heading 39.20, which did not satisfy the stipulated condition. The same requirement continued under Notification No. 14/92, and the earlier Tribunal ruling on the point was applied. The additional plea that the goods were not marketable was also found to be without force in view of the unrebutted finding that the appellants themselves had been procuring similar Dobby Cards from other parties before installation of their own machines.

Conclusion: The exemption was not available and the appeal failed.

Final Conclusion: The impugned order denying exemption was sustained, and the assessee was not entitled to relief.

Ratio Decidendi: Where an exemption notification conditions benefit on the use of inputs falling within specified tariff sub-headings, goods manufactured from inputs outside that range are not eligible for the exemption.

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