2019 (3) TMI 714 - AT - Customs

Conversion of shipping bills - whether the Commissioner of Customs is justified by the impugned order-in-original, in denying the request of conversion of Free Shipping Bill to Drawback Shipping Bill? - Held that - The reasons given by the ld. Commissioner for rejection of conversion of Free Shipping Bill to Drawback Shipping Bill are not tenable as the appellant had re-exported the goods under bond, which was, at the relevant time, alive and has not been examined by the Customs. Further, the appellant has mentioned in body of the shipping bill, wherein under the Col. description , the appellant mentioned Tractor Parts OCKSHAFT Assembly MC 750 CC SI REMOTE /Re-Export against BOE No.7683830 dt.22/12/2014. Thus, the appellant has disclosed in the shipping bill that they have re-exported the goods, and all the information was on the record of the Customs Department, as is evident from the facts on record. Further, at the relevant time, the bond had not been cancelled by the Department. The fact of re-export under bond is established. The rejection of the request for conversion is not tenable - appeal allowed - decided in favor of appellant.

Summary

Issues:
- Request for conversion of Free Shipping Bill to Drawback Shipping Bill

Analysis:
The issue in this appeal revolves around the denial of the conversion request of a Free Shipping Bill to a Drawback Shipping Bill by the Commissioner of Customs. The appellant had exported goods to a company in Turkey, claimed benefits under DEPB, and subsequently re-imported the goods for repairs. The goods were re-exported after a significant delay, leading to the request for conversion. The appellant approached Customs Authorities for releasing the bond and bank guarantee, but faced rejection due to non-compliance with certain conditions of notification no.158/95-Cus. The appellant then applied for conversion under Section 74 read with Section 149 of the Customs Act, 1962.

The Customs Act, specifically Section 149, allows for the amendment of documents under certain conditions. The rejection of the conversion request was based on the shipping bill not being a drawback shipping bill and not explicitly declaring the claim under Section 74 of the Customs Act. However, the appellant argued that all necessary declarations for re-export were present on the shipping bill itself, and other conditions were substantially met. The Tribunal found the reasons for rejection to be untenable as the appellant had re-exported the goods under bond, which was still active and had not been examined by Customs.

The Tribunal further noted that the appellant had clearly indicated re-export in the shipping bill's description, and all relevant information was on record with Customs. Since the bond had not been cancelled at the time of re-export, the Tribunal concluded that the rejection of the conversion request was unjustified. Consequently, the impugned order was set aside, and the conversion of the shipping bill to a drawback shipping bill was allowed, granting the appellant consequential benefits in accordance with the law.

Additionally, the Tribunal addressed the rejection of the draw back claim by the Dy. Commissioner, setting aside the order and directing a re-processing of the claim in light of the Tribunal's decision. This comprehensive analysis highlights the legal intricacies involved in the conversion of shipping bills and the importance of compliance with statutory provisions under the Customs Act for availing benefits and reliefs in import-export transactions.