Exemption for goods manufactured without power cannot be denied on a procedural objection when the factual claim is on record.

Notification No. 179/77 exempted T.I. 68 goods manufactured without the aid of power, and the exemption was available on proof of that factual condition. The record showed that the profiles and circles were made by gas cutting without power, and the exemption claim had already been raised before the adjudicating authority. Denial of the benefit merely because the plea was said to be raised belatedly was unsustainable. The exemption was therefore allowed, and the demand and penalty could not survive once the factual basis for the notification was established.

---

---

Issues: Whether the appellants were entitled to the benefit of Notification No. 179/77 dated 18-6-1977 in respect of profiles and circles classified under T.I. 68 of the Central Excise Tariff, where the goods were manufactured without the aid of power.

Analysis: The notification exempted goods falling under T.I. 68 from duty when no process in relation to their manufacture was ordinarily carried out with the aid of power. The claim for exemption had been specifically raised before the adjudicating authority and noticed in the order. The record showed that the goods were manufactured by gas cutting and that no power was used in the manufacture of the items. On these facts, the denial of the notification benefit solely on the ground that the plea had not been raised earlier was unsustainable.

Conclusion: The appellants were entitled to the exemption under Notification No. 179/77 and the impugned order was set aside.

Final Conclusion: The demand and penalty could not be sustained once the goods were found to have been manufactured without the aid of power, and the appeal succeeded on the exemption claim.

Ratio Decidendi: Where a tariff-exempt notification grants relief to goods manufactured without the aid of power, the exemption must be allowed on proof of that factual condition, and the claim cannot be rejected merely on a procedural objection when it was in fact raised before the adjudicating authority.

---