Exemption for quality control samples survives where the department fails to prove breach of notification conditions on the full record.

Duty-free clearance of quality control samples under an exemption notification depended on compliance with the value limit and distinct packing requirements. The record showed that the assessee had claimed the benefit for separately described sample packs, while the departmental case rested on an isolated sample and did not read the classification lists as a whole. The document notes that the samples were not clearly shown to be for sale, and the department did not establish how many samples were retained in the factory or cleared. On that record, non-fulfilment of the notification conditions was not proved and the exemption benefit was held to remain available.

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Issues: Whether duty-free clearance of quality control samples was rightly denied on the ground that the samples were not packed in a form different from the regular trade packing and the departmental case was not established.

Analysis: The notification allowed duty-free clearance of samples subject to limited value and distinct packing requirements. The classification lists and records showed that the assessee had claimed the benefit for quality control samples and had described the sample packs separately. The finding of the lower authority was based only on one sample packing, without reading the classification lists as a whole or establishing that the samples were not marked as not for sale. The record also did not clearly show how many samples were retained in the factory and how many were cleared, and the departmental case on non-fulfilment of the notification conditions was not proved.

Conclusion: The denial of the notification benefit was not sustained and the appeal was allowed in favour of the assessee.

Final Conclusion: The assessee remained entitled to the benefit of the exemption notification for the quality control samples, and the duty demand was set aside with consequential relief.

Ratio Decidendi: Where exemption is claimed for samples under a notification, the department must establish breach of the notification conditions on the basis of the record as a whole and not on an isolated sample or incomplete reading of the classification list.

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