Exemption turnover computation excludes only live notifications; earlier exempt clearances stayed countable, denying eligibility under the later scheme.

Clearances exempted under Notification No. 46/81-C.E. were held to remain includible in the preceding year's turnover for eligibility under Notification No. 77/85-C.E., because the exclusion in Explanation II(a) applied only to another exemption notification then in force when the later benefit was claimed. As the assessee sought exemption only from 1-8-1985, the earlier notification had already ceased to operate for that purpose, and the aggregate clearances crossed the prescribed turnover limit. The exemption under Notification No. 77/85-C.E. was therefore not available, and the turnover condition was not satisfied.

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Issues: Whether clearances made under Notification No. 46/81-C.E. during the preceding financial year could be excluded while computing the aggregate value of clearances for eligibility under Notification No. 77/85-C.E.

Analysis: The applicable exclusion in Explanation II(a) to Notification No. 77/85-C.E. covered only goods exempted by another notification that was for the time being in force when the computation under Notification No. 77/85-C.E. was made. Since the assessee sought to claim the benefit of Notification No. 77/85-C.E. only from 1-8-1985, Notification No. 46/81-C.E. had already ceased to operate for that purpose. The earlier exempt clearances therefore remained includible in the computation of the preceding year's turnover, and the assessee's clearances exceeded the prescribed limit of Rs. 75 lakhs.

Conclusion: The exclusion was not available and the assessee was not entitled to the benefit of Notification No. 77/85-C.E.; the finding was against the assessee.

Final Conclusion: The turnover condition for the exemption was not satisfied, so the demand to deny the exemption was upheld.

Ratio Decidendi: An exemption notification excluding prior clearances applies only to exemptions under a notification that is in force at the time the later notification is invoked, and earlier exempt clearances remain countable when the claimant's entitlement under the later notification arises after the earlier notification has ceased to operate.

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