Customs verification under the DEEC scheme is a substantive requirement; non-declaration and missing endorsement defeat regularisation.

Non-declaration in the AR form and failure to obtain Customs verification and endorsement under the DEEC scheme were treated as a substantial breach, not a condonable procedural lapse. The export documents did not show that the goods were exported toward discharge of the advance licence obligation, preventing Customs officers from verifying compliance with licence and policy requirements. A certificate from the Central Excise Inspector at the factory was not accepted as a substitute for Customs satisfaction. The verification and endorsement requirements were held to be safeguards of substance intended to prevent misuse of the duty exemption scheme, so regularisation under the scheme was denied.

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Issues: Whether non-declaration in the AR form and absence of Customs verification and endorsement under the DEEC scheme was only a condonable procedural lapse, or a substantial non-compliance disentitling the appellant to regularisation of the export.

Analysis: The export documents did not indicate that the goods were being exported towards discharge of export obligation under the advance licence, and therefore the Customs officers could not verify or draw samples to satisfy themselves that the goods exported matched the licence and policy requirements. The certificate issued by the Central Excise Inspector at the factory was not treated as a substitute for the satisfaction of the Customs officers under the Customs regime. The verification and endorsement requirements under the Export Policy were held to be safeguards of substance and not mere formalities, intended to prevent misuse of the duty exemption scheme.

Conclusion: The defect was held to be a substantial breach and not a condonable procedural irregularity, so the claim for benefit under the scheme failed.

Final Conclusion: The appeal was rejected because the mandatory Customs verification requirements for regularisation under the DEEC scheme were not complied with.

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