2010 (2) TMI 922 - CGOVT - Customs

Revision application - goods were exported under free shipping bills and later converted into drawback shipping bills under Section 74 of Customs Act, 1962 - Asstt. Commissioner of Customs (DBK) passed an order rejecting their claims on merits as the goods were not identified at the time of export to the satisfaction of Asstt. Commissioner of Customs as required under Section 74(iii) (a) of the Customs Act, 1962 - Drawback claim was denied because the examination report was not signed by Asstt. Commissioner - Held that - in the case of M/s. Suksha International 1989 (1) TMI 316 - SUPREME COURT , when there is no evidence against actual imports/exports as none of the available document stand objected as being incorrect or false then the department should act in way so as facilitate the verification of substantive requirement rather than totally denying the available incentive scheme and the substantial benefits to the importer/exporter otherwise the very purpose of the same will stand defeated which would not be just and proper for natural justice, order-in-appeal upheld, Revision application is thus rejected being devoid of merits

Summary

Issues:
- Interpretation of Section 74 of the Customs Act, 1962 for drawback claims
- Compliance with procedural requirements for converting free shipping bills into drawback shipping bills
- Examination and verification of goods by customs officials
- Application of relevant case laws in determining eligibility for drawback claims

Analysis:
1. Interpretation of Section 74 of the Customs Act, 1962: The main issue in this case revolves around the interpretation of Section 74 of the Customs Act, 1962, which mandates that goods must be identified by the Assistant/Deputy Commissioner at the time of export for drawback to be paid. The jurisdictional Commissioner of Customs argued that the goods were not identified as required by the statute, making the grant of drawback a violation of the Customs Act.

2. Compliance with Procedural Requirements: The appellant contended that the exporter's filing of free shipping bills electronically, instead of manual shipping bills as required for drawback claims under Section 74, led to the goods not being presented for inspection by the Assistant Commissioner. This procedural lapse was highlighted as a reason for rejecting the drawback claim.

3. Examination and Verification of Goods: The examination reports by the appraiser and examiner were crucial in establishing the identity of the exported goods. While the reports were not signed by the Assistant Commissioner, the respondent argued that the identity of the goods was clearly established through these reports, even though they were not counter-signed by the Assistant Commissioner.

4. Application of Relevant Case Laws: Both parties relied on various case laws to support their arguments regarding the eligibility for drawback claims. The respondent cited judgments emphasizing the importance of substantive requirements over procedural lapses, while the appellant argued that the specific provisions of the Customs Act must be strictly adhered to for granting drawbacks.

5. Government's Decision: After considering all submissions, including examination reports, case laws, and procedural details, the government upheld the order-in-appeal that allowed the drawback claim. The government emphasized the need to facilitate verification of substantive requirements and benefits to importers/exporters, rather than denying claims based on technicalities. The revision application was rejected for lacking merit, and the impugned order-in-appeal was upheld.