2014 (12) TMI 1050 - AT - Customs

Denial of conversion of free shipping bill to drawback shipping bill - there was no compelling reason beyond the control of the appellant for availing free shipping bill into drawback scheme - Maintainability of appeal - Order passed by Commissioner - Held that - In fact, the argument of the learned AR is self contradictory as on one hand he submits that the Commissioner is not proper officer, the Asst. Commissioner is the proper Commissioner and on the other hand, he submits that the impugned order has been passed by the Asst. Commissioner. The stand of the learned A.R. is not consistent. Further, I find that in this case, in the communication from the Asst. Commissioner forwarded to the appellant stating that the learned Commissioner has taken the decision. Therefore, I hold that the appeal is maintainable before this Tribunal against the order of the Commissioner. There was an alert circular issued against the appellant therefore, it was the compelling reason for not filing the shipping bills under drawback scheme. In these circumstances, the learned Commissioner has committed an error for not considering the request of the appellant for conversion of free shipping bill to drawback scheme. - matter remanded back - Decided in favour of assessee.

Summary

Issues:
Appeal against denial of conversion of free shipping bill to drawback shipping bill.

Analysis:
The appellant, a manufacturer and exporter of copper, exported goods under free shipping bills but faced an alert notice from DGFT, restricting them from availing export schemes. The appellant sought conversion of free shipping bills to drawback scheme, which was denied by the Commissioner (Appeals) citing lack of compelling reasons beyond the appellant's control. The appellant contended that the alert notice was a compelling reason for choosing free shipping bills over drawback scheme, as allowed by C.B.E. & C. Circular 36/2010-Cus. The appellant argued that Rule 12 of Drawback Rules, 1995 provides for exemption from mentioning drawback details in the shipping bill, empowering the Commissioner to convert free shipping bills to drawback scheme.

The opposing argument highlighted that Rule 12 of Drawback Rules, 1995 does not permit conversion from free shipping bill to drawback scheme. The Assistant Commissioner of Drawback Section passed the order, and the appeal was challenged on the grounds that only the Assistant Commissioner, not the Commissioner, could entertain such applications. However, the Tribunal rejected this argument, citing Section 5(2) of the Customs Act, 1962, which allows any officer to exercise powers conferred by the Act. The Tribunal found the argument against the maintainability of the appeal inconsistent, as the Assistant Commissioner was considered the proper officer in one context but not in another. The Tribunal held that the appeal was maintainable before the Tribunal against the Commissioner's decision.

Furthermore, the Tribunal acknowledged the alert notice as a compelling reason for not opting for drawback scheme, finding fault with the Commissioner for not considering the appellant's request for conversion. Consequently, the impugned order was set aside, and the appeal was allowed by way of remand, directing the Commissioner to review the documents related to the conversion of free shipping bills to drawback scheme.

In conclusion, the Tribunal's decision favored the appellant, emphasizing the significance of compelling reasons, proper officer designation, and adherence to relevant customs regulations in the conversion of free shipping bills to drawback scheme.