Exemption certificate verification under customs notification cannot be denied mechanically for missing countersignature alone.

Notification No. 203/92-Cus could not be denied merely because the certificate of non-availment of input credit was not countersigned by Central Excise authorities. The importer had produced a supporting manufacturer's certificate stating that no Modvat credit had been taken, and the revenue had not shown that the certificate was false or otherwise verified it adversely. The exemption could not be refused mechanically on the countersignature defect alone; the certificate's correctness had to be examined on the merits. The matter was remanded to the adjudicating authority for fresh decision after verification of the certificate and after granting the importer a hearing.

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Issues: Whether the benefit of Notification No. 203/92-Cus could be denied solely because the certificate regarding non-availment of input credit was not countersigned by the Central Excise authorities, and whether the demand and penalty required reconsideration.

Analysis: The importer produced a certificate from the supporting manufacturer stating that no Modvat credit had been availed on the inputs used in the manufacture of the exported goods. The condition of the notification required production of a certificate evidencing non-availment of input credit. The denial of exemption was based only on the absence of countersignature by the departmental authorities, although the revenue was not shown to have verified or disproved the certificate. Where the certificate had been produced and its correctness had not been examined, the benefit could not be refused mechanically on that ground alone.

Conclusion: The impugned order was set aside and the matter was remanded to the adjudicating authority for fresh decision after verification of the certificate and after granting an opportunity of hearing to the appellant.

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