Rebate on export goods cannot be refused for procedural lapses when actual export is undisputed and discretion exists under the proviso.

Rebate under Rule 12(1)(b) of the Central Excise Rules, 1944 could not be denied merely for procedural non-compliance where actual export of the goods was undisputed. The proviso empowered the Commissioner, and by delegation the Assistant Commissioner, to sanction the whole or part of the rebate if satisfied that export had in fact occurred, even when some notification conditions were not strictly met. The claim therefore had to be examined on the basis of actual export and the authority's discretion, rather than rejected solely for deviation from procedure.

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Issues: Whether rebate under Rule 12(1)(b) of the Central Excise Rules, 1944 could be denied merely for non-compliance with the prescribed procedure when the fact of export was not in dispute and the authority was empowered under the proviso to allow rebate on being satisfied of actual export.

Analysis: The claim for rebate arose from export of exempted goods and the record did not disclose any dispute as to actual export. The proviso to Rule 12(1) empowered the Commissioner, and by delegation the Assistant Commissioner, to sanction the whole or part of the rebate if satisfied that the goods had in fact been exported, even where some notification conditions were not complied with. The conditions in Notifications Nos. 42/94 and 47/94 were treated as substantially identical in substance, and the authority was therefore required to examine the claim on the footing of actual export rather than reject it solely for procedural deviation. The rejection orders failed to apply that discretion and did not rest on any finding that export was unproved or that there was any wilful omission disentitling the claimant.

Conclusion: The denial of rebate could not be sustained, and the assessee was entitled to have the rebate claim reconsidered in the light of the proviso to Rule 12(1) and the admitted fact of export.

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