Procedural lapse in export compliance cannot sustain duty demand when goods were actually exported and no substantive defect is shown.

Duty demand could not be sustained merely because the exporter did not strictly follow the prescribed export procedure under Rule 18 and Rule 19 of the Central Excise Rules, 2002, where the goods were in fact exported under proper shipping bills and there was no dispute about the exports having taken place. The procedural lapses were treated as condonable, and the absence of any penalty reinforced that the default was not substantive. On that basis, the challenge to the demand failed.

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Issues: Whether duty demand could be sustained merely because the exporter had not strictly followed the procedure under Rule 18 and Rule 19 of the Central Excise Rules, 2002, despite the goods having been exported.

Analysis: The goods were exported under proper shipping bills and there was no allegation that the exports had not taken place. The dispute arose only from procedural lapses in following the prescribed export procedure. The appellate authority found those lapses to be condonable and also noted the absence of any penalty. The appeal did not disclose any substantive infirmity in that view, and the procedural default was not a sufficient basis to confirm duty.

Conclusion: The demand could not be sustained on the basis of the procedural lapse alone, and the Revenue's challenge failed.

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