Prospective operation of exemption amendment leaves branded goods cleared before the cutoff eligible, but denies exemption thereafter.

An amendment to Notification No. 175/86 inserted, by Notification No. 223/87, a condition denying exemption to goods bearing another person's brand name. That restriction was held to operate prospectively because the amending notification did not show any retrospective intent, so branded goods cleared before 22-9-1987 remained eligible for exemption. For clearances made on or after 22-9-1987, the amended condition applied and such branded goods were ineligible for the exemption, with duty payable on those clearances.

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Issues: (i) Whether the amendment made by Notification No. 223/87 to Notification No. 175/86 operated retrospectively so as to deny exemption for goods bearing the brand name of another person cleared before 22-9-1987; (ii) whether exemption under Notification No. 175/86 was available for such branded goods cleared on or after 22-9-1987.

Issue (i): Whether the amendment made by Notification No. 223/87 to Notification No. 175/86 operated retrospectively so as to deny exemption for goods bearing the brand name of another person cleared before 22-9-1987.

Analysis: Notification No. 175/86 did not originally contain a restriction denying exemption to goods affixed with the brand name of another person. That restriction was introduced only by inserting paragraph 7 through Notification No. 223/87 dated 22-9-1987. Nothing in the amending notification indicated that the new condition was intended to operate retrospectively.

Conclusion: The amendment was prospective and did not disqualify branded goods cleared before 22-9-1987 from the exemption.

Issue (ii): Whether exemption under Notification No. 175/86 was available for such branded goods cleared on or after 22-9-1987.

Analysis: After insertion of paragraph 7 by Notification No. 223/87, goods bearing the brand name of another person became ineligible for the benefit of the exemption. The liability for duty on clearances on or after the effective date was accepted.

Conclusion: Exemption was not available for branded goods cleared on or after 22-9-1987, and duty was payable on those clearances.

Final Conclusion: The appeal succeeded in part, with exemption sustained for branded clearances made before 22-9-1987 and duty liability upheld for clearances made on or after that date.

Ratio Decidendi: An amendment denying exemption will operate only prospectively unless the amending notification clearly gives it retrospective effect.

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