Excise exemption requires prior procedural compliance; later formalities cannot validate concessional clearance made without authorisation.

Concessional excise duty under an exemption notification was unavailable where furnace oil was cleared before compliance with the prescribed Chapter X procedure. The tribunal treated Rule 192, the C.T. 2 certificate, security, and departmental satisfaction as substantive conditions for prior authorisation, not mere formalities, and held that actual use or later accountal could not cure non-compliance at the time of removal. Because the purchaser was not duly authorised when clearance took place, the assessee was not entitled to the concessional rate or refund for the disputed period.

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Issues: Whether furnace oil cleared to a fertiliser manufacturer could qualify for concessional duty under the exemption notification before the Chapter X procedure was completed and the requisite certificate and bond were in place.

Analysis: The concession under the notification was held to be contingent on compliance with the procedure prescribed in Chapter X of the Central Excise Rules, 1944. Rule 192 was treated as part of that procedure and not as a mere formality, because the Collector's satisfaction, the issue of the C.T. 2 certificate, the furnishing of security, and the prescribed arrangements for intended use and control were all conditions for determining eligibility to receive goods at the concessional rate. The actual use and accountal of the goods were important, but they did not displace the requirement that the purchaser must already be authorised under the prescribed procedure when removal took place. The later completion of formalities could not validate concessional clearance made before the necessary authority existed.

Conclusion: The assessee was not entitled to the concessional rate or refund for clearances made before compliance with the Chapter X procedure. The claim failed and the exemption was unavailable for the disputed period.

Final Conclusion: Compliance with the prescribed departmental procedure was a prerequisite to availing the exemption, and absence of that compliance at the time of clearance defeated the refund claim.

Ratio Decidendi: Where an exemption notification makes entitlement subject to following a prescribed procedure and obtaining prior departmental authorisation, the concession cannot be claimed for clearances made before those conditions are satisfied.

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