Exemption for granular sulphur upheld where later notification was treated as clarificatory and retrospective.

Crude sulphur in granular form was covered by the exemption under Notification No. 7/92-C.E. because the word "powder" was not statutorily defined and its ordinary meaning was wide enough to include dry particles or granules. The assessee's technical material supported the view that granulation was only an enlarged form of sulphur powder, while the Revenue did not establish any commercial or legal distinction. The later Notification No. 94/93-C.E., which substituted "sulphur" for "sulphur powder," was treated as clarificatory and reflective of the original scope of the exemption, so the benefit of the earlier notification applied retrospectively from inception.

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Issues: Whether crude sulphur in granular form was covered by the exemption under Notification No. 7/92-C.E. dated 1-3-1992, and whether the subsequent Notification No. 94/93-C.E. dated 7-9-1993 was clarificatory and therefore applicable retrospectively.

Analysis: The expression "powder" was not defined in the statute, and its ordinary meaning was wide enough to include a mass of dry particles or granules. The assessee had also produced technical material to show that granulation was an enlargement of sulphur powder, while the Revenue did not establish that granular sulphur was commercially or legally distinct from powder. The later notification substituted the word "sulphur" for "sulphur powder", indicating that it was meant to clarify the scope of the earlier exemption and to reflect the original intention behind the notification.

Conclusion: Crude sulphur in granular form was held to fall within the exemption, and the subsequent notification was treated as clarificatory in nature and retrospectively applicable in support of the assessee.

Final Conclusion: The denial of exemption was unsustainable, and the assessee was entitled to the benefit of Notification No. 7/92-C.E. for crude sulphur in granular form.

Ratio Decidendi: Where the language of an exemption notification is wide enough to cover the goods on their ordinary meaning and a later amendment shows that the earlier wording was only clarificatory, the exemption applies from inception and is not confined by a narrow literal construction.

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