Substantial compliance preserves exemption where a pre-clearance certificate is filed late with the department

Exemption under the notification could not be denied merely because the supporting certificate reached the department after clearance, where the certificate had been issued before clearance and was not shown to be false or unreliable. The delay in forwarding it was treated as a procedural lapse, and substantial compliance with the substantive conditions was sufficient to preserve the exemption. The denial of exemption was therefore unsustainable, and the assessee was entitled to the benefit of the notification.

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Issues: Whether exemption under the notification could be denied merely because the supporting certificate, though obtained before clearance of the goods, was received by the department after clearance.

Analysis: The goods were supplied to an international organization and the required certificate had been issued before clearance. The certificate was not shown to be false or unreliable, and the delay in its receipt by the department was treated as a procedural lapse. Applying the substantial compliance approach, the late forwarding of the certificate was held insufficient to defeat the exemption when the substantive conditions were satisfied.

Conclusion: The denial of exemption was unsustainable and the assessee was entitled to the benefit of the notification.

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