Duty rebate on exports cannot be denied for routing goods through a non-registered godown when verification is duly completed.

Rebate of duty on exported excisable goods is not barred merely because shipment moved through a non-registered godown, where the governing export procedure allows export from a place other than the factory or registered warehouse and prescribed verification is followed. Substantial compliance with the verification process, including matching ARE-1 and shipping bill particulars, customs export certification, and excise endorsement after inspection, is sufficient to establish export and duty-paid character. Procedural objections do not defeat rebate when identity, export, and duty-paid status are duly correlated on the record.

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Issues: (i) whether rebate of duty on exported excisable goods could be denied merely because the goods were routed through a godown that was not a registered warehouse instead of being exported directly from the factory or warehouse; and (ii) whether the export and duty-paid character of the goods stood sufficiently verified and correlated in accordance with the applicable procedure.

Issue (i): whether rebate of duty on exported excisable goods could be denied merely because the goods were routed through a godown that was not a registered warehouse instead of being exported directly from the factory or warehouse.

Analysis: The rebate claim was examined with reference to Rule 18 of the Central Excise Rules, 2002, Section 11B of the Central Excise Act, 1944, Notification No. 19/2004-C.E. (N.T.) dated 6-9-2004, and the procedure prescribed by Circular No. 294/10/97-CX dated 30-1-1997. The governing circular permits export from a place other than the factory or registered warehouse, provided the prescribed verification procedure is followed. The mere fact that the goods were routed through a godown that was not a registered warehouse was therefore not, by itself, a ground to reject rebate.

Conclusion: Rebate could not be denied solely on the ground that the goods were exported through a non-registered godown rather than directly from the factory or warehouse, and the issue is decided in favour of the assessee.

Issue (ii): whether the export and duty-paid character of the goods stood sufficiently verified and correlated in accordance with the applicable procedure.

Analysis: The records showed matching particulars in the ARE-1 forms and shipping bills, customs certification of export, and endorsement by central excise officers after verification of the goods. The procedure under the circular required verification of identity, duty-paid character, and other particulars before permitting export. The materials on record showed substantial compliance with that procedure, and no specific violation of the circular was established. Procedural objections could not override the verified export evidence and the endorsed export documents.

Conclusion: The export and duty-paid character were duly verified and correlated, and the issue is decided in favour of the assessee.

Final Conclusion: The rebate claims were held admissible, the appellate orders rejecting them were set aside, and the original sanction orders were restored.

Ratio Decidendi: Rebate of duty on exported goods cannot be denied for a mere procedural deviation where the exporter substantially complies with the prescribed verification procedure and the export, identity, and duty-paid character of the goods are duly established by official endorsements and matching export documents.

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