2017 (8) TMI 978 - AT - Customs

DEPB benefit - Processing of Shrimps exported - Perishable Commodity - Revenue says that default to use the respective chemicals/preservatives as per the SION prescribed by DGFT shall make the goods perishable and thereby disrepute the country in view of the WTO norms - Held that - the appellant has not brought out any evidence to suggest that the job work carried out on behalf of the appellant was using the chemical norm prescribed by the DGFT which is popularly known as SION norms. Once the evidence do not exist, the claimant has no case to make a higher claim of DEPB. Therefore, without going into the other details it can irresistibly be concluded that allegation of Revenue was reasonable for which the appeal is dismissed - decided against appellant.

Summary

Issues: Alleged non-compliance with DGFT guidelines in processing and exporting shrimps leading to denial of DEPB claim.

In this case, the primary issue revolved around the alleged non-compliance by the appellant with the guidelines issued by the Directorate General of Foreign Trade (DGFT) in processing and exporting shrimps. The Revenue contended that the shrimps exported did not undergo processing in accordance with the prescribed norms, specifically regarding the use of prescribed chemicals such as Sodium Tri Polyphosphate and Sodium Meta Bi Sulphite. The prescribed norms were detailed in Public Notice No. 19 (RE-98) 1997-2002, specifying the quantity of inputs allowed for processing one Metric Tonne of export products. The failure to adhere to these norms was argued to render the goods perishable and detrimental to the country's reputation in international trade, especially in compliance with WTO norms.

The investigation revealed that the appellant failed to provide evidence or documentation proving the use of the prescribed chemicals in processing the exported shrimps. Despite claiming that the processing was done through job workers, the appellant could not demonstrate compliance with the prescribed norms. The lack of bills or records to substantiate the use of the required chemicals raised doubts about the veracity of the appellant's claims. The Customs authorities, considering the absence of evidence supporting the appellant's compliance with the prescribed norms, denied the claim for Duty Entitlement Pass Book (DEPB) benefits against the exports made without following the Standard Input Output Norms (SION).

Upon hearing the arguments from the Revenue and examining the grounds of appeal, the Tribunal found that the appellant failed to present any evidence to establish that the job work carried out on their behalf complied with the DGFT-prescribed SION norms. The absence of such evidence led to the conclusion that the appellant's claim for DEPB benefits was unfounded. Consequently, the Tribunal dismissed the appeal, emphasizing that without evidence of compliance with the prescribed norms, the Revenue's allegations were deemed reasonable. The Tribunal also noted the prolonged pendency of the appeal and the granted stay against the adjudicated demand, highlighting the prejudicial impact on the Revenue's interests over the past decade.