ORDER

1. The question involved in these appeals is whether an assessee is bound to avail of exemption or can forgo the same in order to avail MODVAT credit. The assessee. relying npon a trade notice dated li-3-1988 issued by the Central Excise and Cnstoms Collector. did not avail of an exemption granted under Exemption Notification No. 53/88 dated 1-3-1988. The trade notice c stated tbat it was the option of the assessee eitber to avail of the full exemption available or to pay the duty leviable on the goods manufactured by him. If the assessee chose to pay the duty in spite of the goods being fully exempted. MODVAT credit could not be denied on such duty-paid inputs if used in the manufactured final products. The respondent assessee accordingly. chose to pay the duty and availed of the MODVAT credit.

2. Subsequent to the issuance of the notification, the trade notice dated 11-3-1988 was withdrawn on 4-1-1991. This trade notice being Trade Notice No. 008/91. stated that the matter has been re-examined and it was clarified that the assessee had no option but to avail of the exemption in case the goods were fully exempted from payment of duty.

3. A show-cause notice was accordingly is