2010 (3) TMI 830 - CGOVT - Central Excise

Revision application - applicant has not followed the procedure as prescribed in the Notification No. 43/2001-C.E. (N.T.), dated 26-6-2001 - Held that - Government observes that when the goods have been exported under the supervision of the Central Excise officers and proof of export has duly been accepted by the department, non observance of the procedure of Notification No. 43/2001-C.E. (N.T.), dated 26-6-2001 for denying the benefit of export and confirming the recovery of the duty on goods exported is not justified especially when this is no ambiguity regarding the identity and export of the said goods to the satisfaction of the Central Excise and Customs officers. These are Catena of judgment of various judicial forum including reversionary authority wherein it has consistently been held that the substantial benefit to exporter should not be denied due to procedural/technical lapses especially when there is no dispute regarding the actual export of the duty paid goods, order-in-appeal set aside and order-in-original upheld, Revision Application succeed in above terms.

Issues:
1. Allegation of clearance of goods for home consumption instead of export.
2. Discrepancy in matching crates cleared and exported.
3. Non-observance of prescribed procedure under Notification No. 43/2001-C.E. (N.T.).
4. Appeal against the order-in-original by the Commissioner.
5. Grounds for revision application filed by the applicant.
6. Examination of procedural compliance for export clearance.
7. Dispute over following prescribed procedure for export clearance.
8. Denial of export benefits due to procedural lapses.
9. Decision on setting aside the order-in-appeal and upholding the order-in-original.

Analysis:
1. The case involves an allegation that goods cleared by the applicant for M/s. Pepsico were actually for home consumption, not export. The Department claimed duty payment for clearances to M/s. Ace Glass Containers Ltd., which were considered as a penultimate sale before export of glass bottles by M/s. Ace Glass Containers Ltd. The lower adjudicating authority dropped proceedings, but the Commissioner appealed, citing non-payment of duty and procedural irregularities.

2. The Commissioner (Appeals) set aside the order-in-original, stating the applicant did not follow the prescribed procedure under Notification No. 43/2001-C.E. (N.T.). The applicant then filed a revision application, arguing that the Show Cause Notice did not include such allegations. They contended that the consolidation of export consignments with AGCL was a normal practice to save freight and did not violate export procedures.

3. The revision application highlighted that the goods were exported under the supervision of Central Excise officers, following specific procedures outlined in the permission letter dated 17-7-2002. The applicant emphasized that the positive correlation between cleared and exported goods was established through proper documentation, accepted by the Asstt. Commissioner even before the Show Cause Notice was issued.

4. The Government observed that despite procedural lapses under Notification No. 43/2001-C.E. (N.T.), the goods were exported under supervision, and proof of export was accepted. The Government cited judicial precedents that emphasize not denying export benefits due to technical lapses when actual export of duty-paid goods is established. Consequently, the Government set aside the order-in-appeal and upheld the order-in-original, ruling in favor of the revision application.

5. The judgment underscores the importance of substantiating actual export of goods despite procedural irregularities, ensuring that exporters are not unduly penalized for technical lapses when the export itself is proven. The decision prioritizes the substantive benefit to exporters over procedural shortcomings, aligning with established legal principles and precedents in similar cases.

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