Rakesh Kumar, Technical Member - The facts leading to filing of this appeal are, in brief, as under:—

1.1 The appellant are manufacturers of stainless steel utensils from S.S. Flats. The stainless steel utensils during the period of dispute were fully exempt from duty and, therefore, the appellant had not taken central excise registration. The period of dispute in this case is from 31.12.2002 to 31.03.2003 and during this period, they exported stainless steel utensils under claim for rebate under Rule 18 of the Central Excise Rules, 2002 of the excise duty paid on the inputs used in the manufacture of the stainless steel utensils. The rebate claims totaling Rs.9,26,000/- were rejected by the Asstt. Commissioner vide order-in-original dated 13.11.2004 on the ground that the input duty rebate under Rule 18 of the Central Excise Rules, 2002 was subject to following the condition and the procedure prescribed in this regard, under Notification No. 41/2001-CE(NT), dated 26.06.2001 read with Notification No. 42/2001-CE (NT) dated 26.06.2001 and the procedure for claiming rebate was not followed by the appellant inasmuch as the appellant neither made the required input output ratio declaration as a result of which their input output ratio could not be verified nor cleared their finished products under ARE-2. The Asstt. Commissioner while rejecting the refund claims observed that there is not even substantial compliance of the procedure prescribed under Notification No.41/2001-Cus (NT) and, therefore, in view of the judgement of the Apex Court in the case of Mangalore Chemicals & Fertilizers Ltd. v. Dy. CCT the rebate cannot be sanctioned, as the conditions prescribed in this case are not of technical nature but have to be treated as substantive conditions meant to prevent the commission of fraud. The Asstt. Commissioner also observed that input output norms adopted by the appellant on the basis of Exim Policy are not valid, as for the purpose of claiming input duty rebate under Rule 18, the appellant should have declared input duty ratio, offered the same for verification by the jurisdictional central excise officers, which was not done. On appeal being filed to the Commissioner (Appeals) against this order, the Commissioner (Appeals) vide order-in-original, dated 8.12.2005 upheld the Asstt. Commissioner's order. Against this order of the Commissioner (Appeals), this appeal has been filed.

2. Heard both the sides.

3. Shri Rajiv Tuli, Advocate, ld. Counsel for the appellant, pleaded that the appellant engaged in the manufacture of stainless steel utensils were exporting the same for several years without any objection of any nature whatsoever from the customs department as at no point of time, there was objection from the customs department in respect of the quality, quantity, description and specification of the export consignments, that the exports had been made under shipping bills which were supported by the documents such as export invoices, packing slips for shipment, and bill of lading issued by the Shipping Company, that the certificate issued by the shipping company and bank realization certificate issued by the bankers as evidence of export payments had also been furnished along with rebate claims, that when there is no doubt about the fact of export of the goods and the fact that the duty paid inputs have been used for manufacture of export goods, which during the period of dispute, were fully exempt from duty, there is no justification for rejection of the input duty rebate under Rule 18 of the Central Excise Rules, 2002, that except for the condition of clearance of export consignments under ARE-2 and of declaration of input output ratio and its verification, all other procedures and conditions, as laid down in the Notification No. 41/2000-CE have been followed, that just because the input output ratio was not declared, the rebate claim cannot be rejected, as the appellant have claimed the rebate in terms of the stand