First clearances under exemption notification must be counted from the financial year's start, not the later option date.

For exemption under Notification No. 1/93 based on "first clearances", the relevant reckoning point is the commencement of the financial year. Clearances made earlier in the year must be counted even if the manufacturer exercises the option to avail the notification later in that same year. The expression "first clearances" was read as referring to clearances from the start of the financial year, so later election does not permit exclusion of prior clearances. The departmental view was accepted.

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Issues: Whether, for computing the value of clearances under Notification No. 1/93, the relevant date is the commencement of the financial year or the date on which the manufacturer opts to avail the notification.

Analysis: The notification uses the expression "first clearances", which was construed to mean clearances from the commencement of the financial year. A manufacturer cannot exclude earlier clearances merely because the option to avail the notification was exercised later in the same financial year, when the notification was available from its beginning.

Conclusion: The relevant reckoning point is the commencement of the financial year, not the date of exercise of the option. The department's view was accepted.

Ratio Decidendi: For exemption based on first clearances, the clearances must be counted from the start of the financial year, irrespective of the later date on which the assessee elects to avail the notification.

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