Conditional excise exemption requires strict procedural compliance before refund can be claimed.

Conditional excise exemption under Notification No. 211/85-C.E. was available only on strict compliance with the stipulated substantive and procedural requirements, including the documentary conditions and Chapter X procedure. Where the goods were not supported by the required certificate before clearance and the prescribed application, licence, certificate and accounting mechanism were not followed, the exemption could not be treated as available. On that basis, no consequential refund could be sanctioned.

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Issues: Whether refund of duty was admissible when the assessee did not satisfy the conditions attached to Notification No. 211/85-C.E. and did not follow the prescribed Chapter X procedure under the Central Excise Rules, 1944.

Analysis: The exemption under Notification No. 211/85-C.E. was conditional and applied only where the goods were required for oil exploration activity by ONGC or Oil India Ltd. The benefit depended upon prior compliance with the stipulated documentary requirements and observance of the Chapter X procedure, including the prescribed application, licence, certificate, and accounting mechanism. In the absence of the required certificate before clearance and without following the procedural requirements, the exemption could not be treated as available and no refund could be sanctioned on that basis.

Conclusion: The refund claim was not admissible and the appeal failed.

Ratio Decidendi: Where an exemption notification is conditional, strict compliance with the attached substantive and procedural requirements is a prerequisite to claiming the exemption or any consequential refund.

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