Duty-paid exports to Nepal did not waive exemption under Notification No. 1/93 for later home clearances.

Construction of para 4 of Notification No. 1/93 determined that payment of duty on exports to Nepal did not amount to an election to forgo the exemption. The Tribunal followed its earlier view in an identical matter and held that such duty-paid export did not disentitle the assessee from claiming the notification benefit for later clearances intended for home consumption. The denial of exemption was therefore unsustainable and the issue was decided in favour of the appellants.

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Issues: Whether payment of duty on exports to Nepal amounted to an option not to avail the benefit of Notification No. 1/93 so as to deny the exemption for subsequent clearances for home consumption.

Analysis: The dispute turned on the construction of para 4 of Notification No. 1/93. The Tribunal had already held in an identical matter that export to Nepal on payment of duty does not amount to an exercise of option to forgo the exemption under the notification. On that reasoning, the prior duty-paid export did not disentitle the assessee from claiming the benefit of the notification for later clearances meant for home consumption.

Conclusion: The issue was decided in favour of the appellants and the denial of the notification benefit was unsustainable.

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