Small-scale exemption clearances under multiple tariff headings may be aggregated for the overall limit, subject to individual-heading ceilings.

Under Notification No. 175/86-C.E., clearances of excisable goods falling under more than one tariff heading could be aggregated for the overall small-scale exemption limit, while remaining subject to the notification's individual-heading ceiling. The Tribunal found no material error in the appellate authority's reading of the notification or its reliance on earlier precedent. The Revenue's objection was based on an incorrect construction of the appellate order and did not disturb the settled interpretation of the exemption scheme. The challenge to the grant of small-scale exemption therefore failed, and the appellate order was left undisturbed.

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Issues: Whether, for the purpose of the small-scale exemption under Notification No. 175/86-C.E., clearances of excisable goods falling under more than one tariff heading had to be aggregated so that the assessee could avail full exemption up to the prescribed overall limit, subject to the individual-heading ceiling.

Analysis: The exemption notification was applicable to the clearances in question and the Tribunal's earlier view was that where a manufacturer cleared specified goods falling under more than one heading, the value of clearances could be taken in combination for the overall exemption limit. The record showed no material error in the appellate authority's understanding of the notification or its reliance on the earlier Tribunal decision. The Revenue's grievance proceeded on an incorrect reading of the appellate order and did not displace the governing interpretation of the exemption scheme.

Conclusion: The issue was decided in favour of the assessee and against the Revenue.

Final Conclusion: The Revenue's challenge to the grant of the small-scale exemption failed, and the appellate order was left undisturbed.

Ratio Decidendi: Where a small-scale exemption notification applies to goods cleared under more than one tariff heading, the eligible clearances may be computed on an aggregate basis for the overall exemption limit, subject to the notification's individual-heading restriction.

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