2022 (8) TMI 1194 - HC - Customs

IGST refund - linkage of the data concerning the petitioner s exports amongst Customs, DGFT and concerned bank has not taken place - data, with regard to the export, not being transferred to the DGFT portal - HELD THAT - Quite clearly, the various facets concerning the subject goods which have been exported, as it appears, (apart from anything else), are verifiable manually - however, since the verification, takes place electronically, DGFT has expressed difficulties in validating the transactions for the purpose of processing the request of the petitioner for grant of MEIS benefits. We are informed that the electronic system has been in place since 2015. The concerned member, CBIC is directed to convene a meeting with the Chairperson of NIC and the Director General, DGFT, to find a solution to the problem - We also make it clear that if the solution to the problem concerning verification is not available electronically, then the transaction(s) in issue concerning the subject goods, will be verified manually by the DGFT and respondent nos. 2 to 5/Customs. - List the matter on 23.08.2022.

Summary

Issues:
1. Delay in processing MEIS benefits claimed by the petitioner.
2. Non-transfer of export data to DGFT portal causing hindrance in granting MEIS benefits.
3. Difficulties faced in electronic verification of export transactions by DGFT.
4. Directions for CBIC to convene a meeting with NIC and DGFT to find a solution.
5. Provision for manual verification of transactions if electronic verification is not feasible.

Analysis:
1. The petitioner highlighted the delay in receiving Merchandise Exports From India Scheme (MEIS) benefits against certain shipping bills despite receiving IGST refund against others. The matter had been pending since 2018 with the Directorate General of Foreign Trade (DGFT).

2. The delay was attributed to the non-transfer of export data to the DGFT portal, leading to a lack of linkage between Customs, DGFT, and the concerned bank. This issue was acknowledged, emphasizing that the IGST refund had been processed based on the same exports, indicating the receipt of export proceeds in foreign currency.

3. Despite the manual verifiability of the exported goods' facets, electronic verification posed challenges for DGFT due to difficulties in validating transactions electronically since the system had been in place since 2015. The National Informatics System (NIC) was suggested to potentially assist in resolving this issue.

4. The Court directed the Central Board of Indirect Taxes and Customs (CBIC) to organize a meeting with NIC and the Director General of DGFT to address the verification problem. If an electronic solution was not feasible, manual verification by DGFT and Customs was mandated for the subject transactions concerning the exported goods.

5. The judgment referred to relevant procedures in the Handbook of Procedure, 2015-2020, emphasizing the need for manual verification of non-EDI shipping bills if electronic verification was not possible. A report on progress was ordered to be submitted before the next hearing scheduled for 23.08.2022, ensuring a follow-up on the resolution of the verification issue.