Clearance value computation under exemption law includes value-based exempt clearances when the governing explanation excludes only non-value-based relief.

For computing eligibility under Notification No. 75/87, clearances covered by Notification No. 1/93 had to be included because Explanation II excluded only exemptions that were not value-based or quantity-based. As Notification No. 1/93 was a value-based exemption, the value of clearances of the goods concerned formed part of the aggregate clearance value under Notification No. 75/87. Since the aggregate value of all manufactured goods exceeded the prescribed ceiling, exemption under Notification No. 75/87 was not available.

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Issues: Whether, for determining eligibility to exemption under Notification No. 75/87, the aggregate value of clearances of goods exempted under Notification No. 1/93 was required to be included in the computation of clearance value.

Analysis: Notification No. 75/87, Explanation II, provided that the aggregate value of clearances of goods exempted under a notification which is not value-based or quantity-based would not be taken into account. Notification No. 1/93 was a value-based exemption notification. The value of clearances of the goods covered by Chapter 90 and Chapter 94 therefore had to be included while computing the aggregate clearance value for the purpose of Notification No. 75/87. Since the aggregate value of clearances of all goods manufactured by the assessee exceeded the ceiling prescribed under Notification No. 75/87, the exemption could not be granted.

Conclusion: The assessee was not entitled to exemption under Notification No. 75/87 and the Revenue's appeal succeeded.

Ratio Decidendi: For computation of clearance value under an exemption notification, clearances under a value-based exempting notification are to be included where the governing explanation excludes only non-value-based and non-quantity-based exemptions.

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