Procedural non-compliance cannot defeat deemed credit refund where eligibility and non-utilisation are established, save for time-barred claims.

Refund of deemed credit was upheld where the assessee had filed the prescribed declaration and maintained a separate deemed credit register, because procedural lapses under the exemption notifications did not defeat substantive entitlement once eligibility was otherwise undisputed. The Tribunal accepted factual verification that the credit remained unutilised during the relevant quarters, and treated missing endorsement or original register extract as non-fatal. It also noted that the disputed AR4 could be verified by the proper authority, with refund to follow if export was established. Relief was denied only to the extent of the claim found time-barred.

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Issues: Whether the assessee was entitled to refund of deemed credit despite alleged non-compliance with procedural conditions attached to the relevant exemption notifications and whether the Revenue could succeed in denying refund on the ground of time-bar for one claim.

Analysis: The claim for refund was supported by declaration under the relevant rule and maintenance of a separate deemed credit register. The objections raised by the Revenue were treated as procedural in nature, and the absence of a particular endorsement or original extract in the register did not defeat the substantive entitlement where eligibility to deemed credit was otherwise not disputed. The Tribunal also accepted the factual verification carried out by the lower appellate authority showing that the credit remained unutilised during the relevant quarters because home-consumption clearances were far less than export clearances. In relation to the disputed AR4, the record could be verified by the proper authority, and refund was to follow if export was established.

Conclusion: The assessee's entitlement to refund was upheld except for the amount found to be time-barred, and the Revenue's challenge was rejected.

Final Conclusion: Procedural lapses in complying with notification conditions did not extinguish the substantive right to refund of deemed credit where eligibility and non-utilisation were established.

Ratio Decidendi: A refund claim for deemed credit cannot be denied merely for procedural non-compliance with notification conditions when the assessee's substantive eligibility and non-utilisation of credit are established.

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