2012 (4) TMI 391 - AT - Customs

Application for benefit of DEPB scheme rejected Hon ble High Court directed not to deny the benefit of conversion but the Commissioner passed order rejecting the request - Held that - Policy Circular No.44(RE-2010)/2009/14, dt.1.11.2011 only directs the regional authorities to decide the admissibility of DEPB benefit in cases where the Commissioner of Customs has already allowed the conversion - in case of shipping bills filed prior to 22.4.97, DEPB benefits could not have been allowed at all since Porbandar was not a port specified for export under DEPB shipping bills - the appellant has failed to follow the requirements of Customs Public notice as none of the shipping bills were assessed by the Assistant Commissioner and the shipping bills were not filed 3 days in advance of shipment at the port of clearance as per CBEC Circular No.10/1997-Cus, dt.17.4.97, the shipping bills for export made under DEPB scheme should bear Blue Colour Strip at the top and should indicate the serial number of the export product in the Public notice issued by DGFT specifying the rate of entitlement and the rate claimed - all substantive conditions for claiming benefit of DEPB scheme were not fulfilled conversion cannot be allowed against assessee.

Summary

Issues:
1. Conversion of free shipping bills to DEPB shipping bills under the DEPB scheme.
2. Compliance with procedural requirements for claiming DEPB benefit.
3. Validity of rejection of conversion request based on specified conditions.

Issue 1: Conversion of free shipping bills to DEPB shipping bills under the DEPB scheme:
The case involved M/s Global Food Exports seeking conversion of free shipping bills to DEPB shipping bills for processed/frozen fish exports. The appellant had initially not declared their intention to claim DEPB benefit but later applied for conversion, which was rejected citing CBEC Circulars. The High Court directed a fresh order on merit, leading to the Commissioner's subsequent rejection. The appellant argued eligibility based on Policy Circular No.44(RE-2010)/2009/14, allowing conversion if applied between specific dates. However, the rejection was upheld as the conversion was never allowed by Customs authorities, rendering the DGFT circular inapplicable.

Issue 2: Compliance with procedural requirements for claiming DEPB benefit:
The Revenue contended that the rejection was justified due to the appellant's failure to fulfill Public notice requirements and submit necessary declarations with shipping bills. The absence of essential information hindered authorities from assessing DEPB eligibility, leading to the rejection being deemed legal and proper. Additionally, specific conditions such as assessment by designated officers and advance submission of shipping bills were not met, further justifying the rejection.

Issue 3: Validity of rejection of conversion request based on specified conditions:
The Commissioner highlighted conditions under Notification No.34/1997-Cus for DEPB scheme exports, including assessment by Assistant Commissioner and specific submission timelines. It was noted that the appellant failed to meet these conditions, such as assessment by the designated officer, leading to the rejection being upheld. Substantive requirements like the color strip on shipping bills and indicating entitlement rates were deemed crucial for DEPB benefit claims, further supporting the rejection.

In conclusion, the Tribunal found no merit in the appeals against the rejection of conversion requests, as the appellant failed to meet essential procedural and substantive requirements for claiming DEPB benefits. The detailed analysis by the Commissioner and non-compliance with specified conditions led to the rejection being upheld.