Exemption under Chapter 87 cannot be denied without proof of a narrower scope; mini bus chassis remained covered.

The exemption under Rule 8(2) for mini bus body and chassis falling under Chapter 87 could not be denied on an unproved claim that it was limited to a narrower sub-heading. The Tribunal found that the record showed exemption for one mini bus under Chapter 87, while the Department failed to produce the exemption order relied on to establish a restricted scope. On that basis, the chassis was treated as covered by the chapter classification and the refund order was upheld, subject to the Supreme Court ruling in Mafatlal Industries.

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Issues: Whether the benefit of the exemption granted under Rule 8(2) of the Central Excise Rules was available to the mini bus body and chassis falling under Chapter 87 of the Central Excise Tariff Act.

Analysis: The claimed restriction of the exemption to a specific sub-heading was not substantiated by the record placed before the Tribunal. The impugned order only showed exemption for one mini bus under Chapter 87, and the Department did not produce the exemption order relied upon to establish a narrower scope. In these circumstances, the Tribunal accepted that the chassis of the mini bus also fell within Chapter 87 and that the refund order was justified. The Tribunal also noted that any refund would remain subject to the Supreme Court decision in Mafatlal Industries.

Conclusion: The exemption was held to be available and the Revenue's challenge failed.

Ratio Decidendi: Where the Department does not prove a narrower scope of an exemption order, a benefit granted for goods falling under a chapter classification cannot be denied merely by asserting a specific sub-heading limitation.

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