2018 (5) TMI 1400

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....e eligible to avail exemption on first clearance of 3500 MTs of paper as per Notification No.4/2006-CE dt.1.3.2006. Accordingly, the assessee had opted to avail the exemption with effect from 1.4.2008. The assessee had removed 150.150 MTs of writing paper and printing paper valued at Rs. 57,01.486/-, over and above the aforesaid exempted quantity of 3500 MTs without payment of Central Excise duty amounting to Rs. 4,69,802/- which was sought to be recovered. Therefore, the proceedings were initiated against the assessee vide show cause notice dt.30.9.2009. The assessee had cleared a quantity of 150.150 on payment of duty MT by availing the exemption of 3500 MTs. It was proposed in the SCN that this quantity of paper be included in the total ....

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....ion is in respect of only certain varieties of paper and does not cover other varieties of paper. There is no warrant to take in other varieties of paper. We are, therefore, of the opinion that the learned Commissioner was in error in holding that the quantity restriction was to be computed taking into account clearances of all varieties of paper manufactured by the appellant. We say so for another reason also. If the exemption is read as applicable to the clearance of all varieties of paper, it yields all unintended results. Either excluded varieties of paper also get the benefit of the exemption on the ground that they were the "first clearances" or the included varieties are denied the exemption (as in the present case) merely on the gro....