Bond clearance and export of processed goods defeated the duty demand despite procedural objections.

Excisable goods cleared under bond with departmental permission, and the processed final product was ultimately exported. On those facts, a mere procedural objection to the manner of clearance did not sustain a duty demand, because the export of the final product and the approved bond procedure were treated as decisive. The suggested distinction that each processing stage produced a separate final product was rejected. The Revenue's challenge to the exemption benefit therefore failed, and the duty demand was not sustainable.

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Issues: Whether duty demand was sustainable where the goods were removed under bond with departmental permission and the processed final product was exported.

Analysis: The factual findings recorded by the appellate authority and affirmed by the Tribunal showed that the goods were cleared under bond with the permission of the Department and, after processing, were ultimately exported. In those circumstances, the Court found no merit in the Revenue's objection that the procedure was not strictly followed. The existence of export of the final product and the permission granted for clearance under bond were treated as decisive, and the suggested distinction that each processing stage resulted in a separate final product was not accepted.

Conclusion: The duty demand was not sustainable, and the assessee succeeded.

Final Conclusion: The appeal was rejected because the export of the final product and the clearance under bond negatived the Revenue's challenge to the exemption benefit.

Ratio Decidendi: Where excisable goods are cleared under bond with departmental permission and the processed goods are duly exported, a mere procedural objection cannot sustain a duty demand.

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