2013 (6) TMI 560 - CGOVT - Central Excise

Export without payment of duty - Furnishing of form-H as proof of export - non compliance of procedure prescribed under Rule 19 of the Central Excise Rules, 2002 and Notification No. 42/2001 - The Applicant submits that they prepared ARE-1 and sent it to their vendor but they refused to sign it due to their company s policy. - Held that - nature of above requirement is vital as statutory condition of compulsory requirement of submitting the correct and proper ARE-1 copies is a must because such leniencies led to possible fraud of claiming an alternatively available benefit which may lead to additional/double benefits. This had never been the policy of the Government and it is the spirit of these backgrounds that Hon ble Supreme Court in case of Sharif-ud-Din. Abdul Gani - 1979 (11) TMI 225 - SUPREME COURT has observed that distinction between required forms and other declarations of compulsory nature and/or simple technical nature is to be judiciously done. When non-compliance of said requirement leads to any specific/odd consequences then it would be difficult to hold that requirement as non-mandatory. Government finds itself in conformity with the opinion of lower authorities and holds that export of said goods is not proved, Government, therefore holds that preparation of statutory requirement of stipulated ARE-1 and following the basic procedure of compliance of B-I Bond condition/from CT-Is export goods as discussed in paras above cannot be altered as per individuals company s internal policy and cannot be treated as just minor/technical procedural lapses for the purpose accepting proof of export of goods in this case. - Decided against the assessee.

Issues:
1. Failure to follow prescribed export procedure under Central Excise Rules.
2. Rejection of appeal by Commissioner (Appeal) and subsequent revision application.
3. Dispute over export goods and compliance with statutory requirements.
4. Non-preparation of ARE-1 form and its significance in proving export of goods.
5. Interpretation of legal provisions regarding export documentation and duty payment.
6. Government's analysis of procedural lapses and adherence to statutory requirements.

Issue 1: Failure to follow prescribed export procedure under Central Excise Rules
The case involved M/s. Synergy Technologies, Thane, a merchant exporter, who faced a demand confirmation, interest, and penalty for not following the procedure prescribed under Rule 19 of the Central Excise Rules, 2002. The Assistant Commissioner confirmed the demand due to non-compliance with export documentation requirements.

Issue 2: Rejection of appeal by Commissioner (Appeal) and subsequent revision application
The applicant filed an appeal before the Commissioner (Appeal) against the Assistant Commissioner's order, which was rejected. Subsequently, a revision application was filed under Section 35EE of the Central Excise Act, 1944 before the Central Government, challenging the impugned order-in-appeal.

Issue 3: Dispute over export goods and compliance with statutory requirements
The applicant argued that the goods were actually exported, citing documents from the Sales Tax department as proof. They also mentioned the need to change part numbers to comply with Japanese standards required by their customer. The case highlighted discrepancies in part numbers and the importance of correlating exported goods with other documents.

Issue 4: Non-preparation of ARE-1 form and its significance in proving export of goods
The non-preparation of the ARE-1 form was a critical point of contention. The Government emphasized the importance of the ARE-1 form as a basic and essential document for exports. The absence of the ARE-1 form and failure to follow the prescribed procedure raised doubts about the actual export of goods and the payment of duty.

Issue 5: Interpretation of legal provisions regarding export documentation and duty payment
The Government analyzed the statutory status and requirements of the ARE-1 form for claiming rebate of duty on export goods. It highlighted the procedural steps involved in presenting the ARE-1 form for sealing of goods intended for export and the verification process by Central Excise officers.

Issue 6: Government's analysis of procedural lapses and adherence to statutory requirements
The Government concluded that the applicant's failure to prepare the ARE-1 form and follow the prescribed procedure was a significant lapse. It emphasized the mandatory nature of submitting correct ARE-1 copies to prevent possible fraud in claiming export benefits. The Government upheld the impugned order-in-appeal, emphasizing the importance of strict compliance with statutory export requirements.

In conclusion, the revision application was rejected for lacking merit, and the impugned order-in-appeal was upheld by the Government, highlighting the essentiality of complying with statutory export procedures and documentation requirements.

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