Exemption for remelted off-specification glass goods remains available when non-marketable stock is reused for further manufacture.

Notification No. 52/86-C.E. was treated as applicable to off-specification glass bottles that had been entered in RG 1 and kept in a bonded store room, because their only practical use was remelting for manufacture of other glass and glassware. The fact that the goods were under bond did not, by itself, support denial of the exemption, since the notification did not exclude such in-factory remanufacture. The Revenue's objection was confined to procedural control over removal from bond and did not displace the substantive exemption entitlement on these facts.

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Issues: Whether the benefit of Notification No. 52/86-C.E. could be denied where off-specification glass bottles, already entered in RG 1 and kept in the bonded store room, were remelted and used for manufacturing other glass and glassware.

Analysis: The goods, though brought into RG 1 and the bonded store room, had become off specification and were not saleable. The only practical use was to remelt them and convert them into other glass and glassware. The notification was found not to exclude such use merely because the goods had been entered in RG 1 or stored in bond. The Revenue's objection was treated as one of procedural control over removal from the bonded store room, and no language in the notification supported denial of the exemption on that ground.

Conclusion: The exemption under Notification No. 52/86-C.E. was admissible on the facts, and the Revenue's appeal was rejected.

Final Conclusion: The decision upheld exemption treatment for discarded, non-marketable glass goods remelted within the factory for further manufacture of glass and glassware, and the Revenue did not succeed.

Ratio Decidendi: An exemption notification covering in-factory use of glass and glassware for further manufacture cannot be denied merely because the goods were previously entered in RG 1 and stored in bond, where they are off specification, non-marketable, and are actually remelted for manufacture of other glass and glassware.

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