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2021 (2) TMI 1101 - HC - CustomsBenefits under Merchandise Exports from India Scheme (MEIS) - product of vitrified tiles exported to Sri Lanka - case of petitioner that Public Notice had been amended on 04.05.2016 being the Public Notice No.6 of 2015 -20 and MEIS scheme was extended to the export made to Sri Lanka at the rate of 2% interest - It is averred by the petitioner that the policy permits the eligibility of the goods which had been exported by the petitioner under the MEIS scheme and it is only the procedural lapse which has resulted into his being denied the benefit of the said scheme - HELD THAT - Having noticed that the case of the petitioner falls under the MEIS which is a scheme meant for promoting the export, these are the rewards under the MEIS payable as percentage mentioned in the scheme itself can be transferred for the payment of number of duties and taxes. As can be gathered from material which has been placed on the record is that Sri Lanka was placed in Group C in the Public Notice No.2 of 2015 dated 01.04.2015. In Gazette of India, the Ministry of Commerce and Industry, Department of Commerce provided in exercise of the powers conferred under para 2.04 of the FTP 2015 -20, the schedule of country groups and the code wise list of product with reward rates under Appendix 3B as pointed out to us that Sri Lanka is not one of those country. It is not in dispute that by way of 73 shipping bills, export has been carried out by the petitioner exporter and he has substantiated the same by way of the documentary evidences, which had happened from 12.05.2016 to 05.01.2017. The Public Notice had been amended firstly on 04.05.2016 and thereafter, on 22.09.2016 whereby Sri Lanka was included and export to Sri Lanka has also been covered under the scheme of MEIS at the rate of 2% and 3% respectively. In the instant case, there is no doubt with regard to the exports having been made under the FTP 2015 -20 where, initially, Sri Lanka was not one of the countries where such reward was available on export to the said country. The petitioner has already exported its product 'vitrified tiles' to Sri Lanka and 73 shipping bills have also been produced before the respondent authorities. What has been pleaded all through out by the petitioner is of lack of knowledge of subsequent public notices which had included Sri Lanka as a country for seeking the reward under the MEIS and entire procedure having been simplified, instead of getting the declaration produced for the purpose of the reward, the ticking of N/Y would suffice in case of the EDI. The ticking itself had been made equivalent to such declaration. It is quite clear that for the purpose of the reward, the EDI has been simplified more particularly, by way of the Public Notice No.9 of 2015 dated 16.05.2016 and the marking of tick in pursuance of the earlier Public Notice No.47 dated 08.12.2015 had been treated as a declaration of intent in case of EDI shipping bills. Section 149 of the Customs Act, 1962 which has been taken recourse to by the petitioner does not prescribe any time limit. It is a discretion of the concerned officer, which can authorize any document after it has been presented in the Custom House to be amended. Of course, this has not to be amended after once the imported goods have been cleared for the home consumption and deposited in the warehouse where export goods have been exported, except on the basis of the documentary evidences, which are in existence at the time of the clearance, deposit or the export of the goods, as the case may be - it is essentially to avail the exporter the benefits prescribed under the MEIS that the request has been sent by the petitioner to make the same available to it. Therefore, it is also expected of the respondent authority to adopt an approach, giving progressive interpretation to all these provisions and the policy decisions rather than having conventional outlook. The impugned communication dated 10.06.2019 is quashed and set aside. Respondent No.2 is directed to issue No Objection Certificate to the petitioner for availing the benefits as provided under the policy - Petition allowed.
Issues Involved
1. Entitlement to benefits under the Merchandise Exports from India Scheme (MEIS). 2. Procedural lapse and its impact on eligibility for MEIS benefits. 3. Application of Section 149 of the Customs Act, 1962 for amendment of shipping bills. 4. Timeliness of the petitioner's request for MEIS benefits. 5. Interpretation of public notices and their applicability. 6. Judicial precedents and their relevance. Issue-wise Detailed Analysis 1. Entitlement to Benefits under MEIS The petitioner, a Merchant Exporter, sought benefits under the MEIS for exports made to Sri Lanka. Initially, Sri Lanka was not eligible under the scheme, but subsequent amendments on 04.05.2016 and 22.09.2016 included Sri Lanka with benefits of 2% and 3% respectively. The petitioner claimed ignorance of these amendments and did not claim the benefits at the time of export. 2. Procedural Lapse and Its Impact on Eligibility The petitioner argued that the procedural lapse of not marking 'Y' (Yes) in the reward column of the shipping bills should not deprive them of substantial benefits. The respondents contended that the marking was mandatory and that the petitioner’s failure to comply with this requirement rendered them ineligible for the benefits. 3. Application of Section 149 of the Customs Act, 1962 The petitioner requested amendments to the shipping bills under Section 149 of the Customs Act, 1962, which allows amendments based on existing documentary evidence at the time of export. The respondents argued that amendments could not be entertained post-export, especially when the intent to claim rewards was not declared. 4. Timeliness of the Petitioner's Request The respondents highlighted that the petitioner took more than a year to become aware of the public notices and seek amendments. They argued that this delay was unreasonable. The court, however, noted that Section 149 does not prescribe a time limit, and the one-year delay was within a reasonable time frame. 5. Interpretation of Public Notices and Their Applicability The court examined various public notices, including Public Notices No.40/15-20, 47/15-20, and 9/15-20, which simplified the procedure for declaring intent in EDI shipping bills. The notices allowed for amendments where exporters had inadvertently marked 'N' (No) instead of 'Y' (Yes). The court emphasized that the objective of these notices was to facilitate and promote exports. 6. Judicial Precedents and Their Relevance The court referred to several precedents, including: - Messrs Gokul Overseas vs. Union of India: Allowed conversion of shipping bills to claim MEIS benefits despite procedural lapses. - Pasha International vs. Commissioner of Customs, Tuticorin: Held that exporters should not suffer due to inadvertent mistakes in marking intent. - Saint Gobain India PVT. LTD. vs. Union of India: Directed authorities to issue a 'No Objection Certificate' to correct shipping bills post-export. Conclusion The court concluded that the procedural lapse of not marking 'Y' should not deny the petitioner MEIS benefits. It emphasized that the objective of MEIS is to promote exports and that procedural simplifications should be interpreted progressively. The court quashed the impugned communication dated 10.06.2019 and directed the respondents to issue a 'No Objection Certificate' to the petitioner for availing the benefits under the policy within eight weeks.
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