2010 (10) TMI 901 - CGOVT - Central Excise

Revision applications - rebate claim - assessee claimed the rebate, which is an export entitlement, has not produced any bill of export as required under the SEZ rules and also as per Circular No. 29/2006-Cus., dated 27-12-2006 Held that - procedural infractions of notifications/circulars should be condoned if exports have really taken place and the law is settled that substantive benefit cannot be denied for procedural lapses, rebate allowed, Revision applications are rejected

Summary

Issues:
Appeal against rejection of rebate claim under Central Excise Act, 1944 based on procedural lapses in export process.

Analysis:
The Commissioner filed revision applications against orders-in-appeal rejecting rebate claims for consignments cleared to SEZ under ARE-1. The circular specified conditions for rebate eligibility under Rule 18 of Central Excise Rules, 2002. The manufacturer-exporter failed to produce the required Bill of Export as per SEZ rules, leading to the rejection of the rebate claim due to non-compliance with procedural conditions.

The Commissioner appealed the original orders, arguing that the rejection was correct as the exporter did not fulfill the conditions specified in the circular. The applicant contended that the procedural requirement of producing the Bill of Export was mandatory for claiming the rebate, and the order-in-appeal was legally incorrect. The respondent did not file a counter reply to the Section 35EE notices issued.

During the personal hearing, the applicant reiterated the grounds of the revision application, while the respondent did not appear or request an adjournment. The government considered oral and written submissions along with lower authorities' orders. It observed that the goods were properly exported to the SEZ area based on ARE-1, endorsed by the Range Officer and customs officer, indicating no ambiguity in the export process.

Citing legal precedents, the government emphasized that procedural lapses should not deny substantive benefits, and restrictive interpretations of beneficial provisions should be avoided. It distinguished between procedural and substantive conditions, highlighting that procedural lapses of a technical nature should not hinder substantive benefits. The government found infirmity in the orders-in-appeal and upheld them, rejecting the revision applications as lacking merit.

In conclusion, the government upheld the rejection of the rebate claims, emphasizing the importance of substantive benefits over procedural lapses in export processes. The revision applications were dismissed based on the analysis and legal principles discussed in the judgment.