2009 (2) TMI 330 - HC - Customs

Drawback re-export - Petitioner seeks Writ of Certiorarified Mandamus to quash the impugned order and direct the 1st Respondent and other officers to refund a sum of Rs. 23,53,275.96 in terms of Sec. 74 of Customs Act on the 5 consignments of confectionery re-exported by the Petitioner. Identity of goods - Mere permitting to export will not lead to grant of drawback amount and it is admissible only subject to the fulfillment of all conditions under Sec. 74 of the Act, to the satisfaction and compliance of laws of the Government. - Respondents stating that in respect of 5 shipping bills, the examination report reveals that the identity of the goods has not been established with reference to the import Bill of Entry and the goods have no market value based on the condition of the goods. Appellant claimed that Assistant Commissioner had not recorded any finding regarding identity of goods against which no appeal was preferred by department - Based on the materials on record, Appellant Authority have taken consistent view that the identity of the goods in respect of 5 consignments were not established and the same does not suffer from any illegal infirmity warranting interference. - Based on the materials on record, Respondents 1 and 2 have taken consistent view that the identity of the goods in respect of 5 consignments were not established and the same does not suffer from any illegal infirmity warranting interference.

Summary

Issues:
Challenge to rejection of drawback claim for re-exported goods under Sec. 74 of Customs Act.

Analysis:
1. Facts and Background: The petitioner re-exported confectionery under 18 shipping bills, claiming drawback under Sec. 74 of Customs Act. The Assistant Commissioner rejected the supplementary claims for all 18 shipping bills. The petitioner appealed to the Commissioner of Customs, who allowed drawback for 13 consignments but rejected it for 5 consignments. The petitioner's revision before the Union of India was also dismissed, upholding the rejection of drawback for 5 shipping bills.

2. Legal Requirements for Drawback Claim: Sec. 74 of Customs Act outlines conditions for claiming drawback, including the import duty payment, re-export within two years, actual export, identifiable goods, and market price not less than the claimed drawback. Sec. 76(b) specifies that no drawback is paid if the market value of exported goods is less than the claimed amount.

3. Identity of Goods and Market Value: The identity of goods is crucial for claiming drawback under Sec. 74. The authorities found that for the 5 consignments, the goods' identity was not established based on examination reports, and the market value did not exceed the claimed drawback amount due to the goods' condition.

4. Judicial Review and Authority's Findings: The court emphasized that the grant of drawback is subject to fulfilling all legal conditions. The 2nd Respondent's decision to reject the drawback for 5 consignments was based on the lack of established identity and insufficient market value, aligning with the legal requirements under Sec. 74.

5. Applicability of Rules and Precedents: The petitioner argued that the same evidence applied to all consignments, but the court upheld the authorities' decision, emphasizing the need for identifiable goods for drawback claims. The court rejected claims of revenue bias and upheld the rejection of drawback based on legal criteria.

6. Conclusion: The court dismissed the writ petition, affirming the authorities' consistent view that the identity of goods for the 5 consignments was not established, and there was no legal infirmity in rejecting the drawback claims. The judgment underscores the importance of complying with statutory requirements for claiming drawbacks under the Customs Act.