2021 (6) TMI 264 - HC - Customs

Conversion of the shipping bill from 'drawback shipping bills to drawback-cum-advance authorization' shipping bills - HELD THAT - It is revealed that the advance authorization licence taken by the petitioner is not disputed. The petitioner had exported garments under the Shipping Bill Nos. 4885813/08.09.2014, 4885840/08.09.2014 and 4885839/08.09.2014 under DBK Scheme and the said shipping bills were cleared for export under RMS, without any examination and LEO granted on 09.09.2014. The contention of the learned Special Government Pleader that the request for conversion of 'drawback shipping bill' to 'drawback-Cum-advance authorization shipping bill' said to have been filed by the petitioner on 08.12.2014 before the Custom House, Tuticorin could not be traced after lapse of five years and six months cannot be accepted by this Court - It is to be noted that since there was no response from the 1st respondent, the petitioner submitted a grievance in Centralized Public Grievance Redressal System and the same was also disposed of by rejecting the request of the petitioner for conversion of the shipping bills. The matter is remanded back to the first respondent for fresh consideration after giving reasonable opportunity including the personal hearing and appropriate orders shall be passed on merits and in accordance with law - Petition allowed by way of remand.

Summary

Issues:
1. Conversion of shipping bills from 'drawback' to 'drawback-cum-advance authorization' scheme.

Analysis:

Issue 1: Conversion of shipping bills
The petitioner sought to convert shipping bills from 'drawback' to 'drawback-cum-advance authorization' scheme. The petitioner had obtained an Advance Authorization for import of specific materials and had an export obligation. The petitioner imported raw materials, manufactured goods, and exported them under the 'drawback scheme'. However, due to the nature of manufacturing using both locally procured and imported inputs, the shipping bills should have been filed under the 'Drawback-cum-Advance Authorization Scheme'. The petitioner made repeated requests for conversion, but faced delays and rejections based on grounds of limitation and lack of examination of imported materials used in manufacturing. The petitioner also faced penalties for alleged non-fulfillment of export obligations under the Advance Authorization. Despite efforts and grievances raised by the petitioner, the conversion request was consistently denied without proper consideration.

The Court observed that the Advance Authorization license was not disputed, and the petitioner had exported goods under the 'drawback scheme'. The Court rejected the respondent's claim that the conversion request could not be traced after several years, noting that the petitioner had made the request within three months of export. The Court criticized the lack of response and consideration given to the petitioner's request, leading to the passing of the impugned order without proper opportunity for the petitioner to present their case. Consequently, the Court set aside the impugned order and remanded the matter back to the first respondent for fresh consideration, emphasizing the need for a reasonable opportunity, including a personal hearing, for the petitioner. The Court directed the first respondent to pass appropriate orders on merits and in accordance with the law within six weeks from the date of the order.

In conclusion, the judgment focused on the procedural fairness and proper consideration required in matters of conversion of shipping bills, highlighting the importance of providing a reasonable opportunity for affected parties to present their case and ensuring decisions are made in accordance with the law.