More beneficial notification principle allows concessional duty option and defeats Modvat credit reversal where exemption also applies.

Where two notifications were simultaneously applicable to aluminium ingots, the assessee could opt for the more beneficial notification and clear the goods on payment of concessional duty rather than be confined to the full exemption notification. On that footing, a demand based on reversal of Modvat credit, issued on the premise that the assessee was bound to adopt the exemption notification, was not sustainable. The department had not disputed the applicability of the concessional notification, so reversal of credit was unwarranted.

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Issues: Whether the assessee, where two notifications were simultaneously applicable, could opt for the more beneficial notification and clear the goods on payment of concessional duty instead of availing the full exemption notification, and whether reversal of Modvat credit was justified.

Analysis: The available notifications prescribed different duty treatments for aluminium ingots. The Tribunal accepted that the assessee was entitled to choose the notification that was more beneficial, and that the department had not disputed the applicability of the concessional notification. On that basis, the demand raised by reversing Modvat credit on the premise that the assessee was bound to clear the goods under the full exemption notification was not sustainable.

Conclusion: The issue was decided in favour of the assessee. The assessee had the option to adopt the more beneficial notification, and reversal of Modvat credit was not warranted.

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