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TMI Blog1994 (4) TMI 391X X X X Extracts X X X X X X X X Extracts X X X X ..... ports representative samples of the goods exported were drawn for test purposes. One of the samples was tested at M/s. SASMIRA. The Report No. Sasmira/Tcl/2202/90-91, dated 5-11-1990 indicated that no polyster yarn was used in the manufacture of the exported products. 5. The Appellant was called upon by the Asstt. Collector of Customs (Drawback Department) vide F.No. S/6-5/91 Exp(NSCH) dated 22-1-1991 to explain the difference. However, in reply to this letter, the exporters contention was that as no Advance licence was granted they are entitled to normal drawback at the rate of 6% of FOB. Drawback at the rate of 6% was granted on the exported goods on executing a bond for repayment of the excess amount of 1%. 6. The Ministry vide their Letter No. F.No. 609/113/91 DBK dated 3-3-1992 addressed to the Collector of Customs, Nhava Sheva informed that the Central Govt. had considered the request of M/s. Bhavin International for conversion of their DEEC shipping bill into a drawback shipping bill and had informed that their request could not be acceded to. The Asstt. Collector (Drawback) in view of this abovesaid letter had issued a Show Cause Notice vide even File No. dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w that the Asstt. Collector acting quasi-judicially is not bound by any directions of higher authorities. In fact quasi-judicial power cannot be controlled by directions of any authority howsoever high. The appellants will rely in this context on the judgment of Supreme Court in Orient Paper Mills v. Union of India as reported in AIR 1970 (SC) 1498. (c) The appellants argued that the provisions of Section 75(1) of the Customs Act read with Rule 3 of the Customs and Central Excise Drawback Rules, 1971 give a statutory right to the appellants to claim drawback on export of the goods. Drawback is mainly intended to encourage exports and having regard to this object the Asstt. Collector was not justified in taking a narrow and legalistic view of the declarations made by the appellants in the shipping bills. The right of drawback as accrued to the appellants cannot be taken away by any technical lapse. See in this context the judgment of Madura Coats v. Government of India, reported in 1986 (23) E.L.T. 63 and CEGAT's decision in Piramal Exports v. Collector of Customs, reported in 1986 (25) E.L.T. 23. The appellants say and submit that it would be a case of gross injustice and pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her words the dispute centred round only 1%. It was never in dispute that the appellants would not be entitled to any drawback at all. The impugned order which was passed on the direction of the Ministry's letter referred to above failed to take into consideration the basic facts that the appellants are legitimately entitled to draw back as per sub-section 2704 of the Drawback Schedule. The dispute was that they had applied for Advance licence for the import of two items free of duty and in case that import materialises they could not have claimed full drawback of 6%. As the import of those two items as mentioned in the shipping bill did not materialise the appellants automatically bacame entitled for full drawback of 6% FOB as provided under sub-rule 2704 of the Drawback Schedule. (f) The appellants contended that if the facts were correctly represented to the Ministry, the Ministry could not have come to the conclusion that the appellants would not be entitled to any Drawback at all. The provision of Drawback is a beneficial provision to boost export and gaining valuable foreign exchange for the country. This beneficial provision cannot be taken away by some technical laps ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the Drawback Schedule. The impugned order is therefore totally erroneous, bad in law, arbitrary and is therefore liable to be set aside. In the premises afroesaid the Appellant requested to set aside the impugned order of the Asstt. Collector. 11. The drawback is sanctioned/allowed within the meaning of Rule 3 of Customs and Central Excise Duties Drawback Rules, 1971 subject to the provisions of Customs Act, 1962 and the rule made thereunder and the Central Excises and Salt Act, 1944 and the Rules made thereon. Rule 3 is reproduced as under :- (1) Subject to the provisions of - (a) the Customs Act, 1962 (52 of 1962) and the rules made thereunder (b) the Central Excises and Salt Act, 1944 (1 of 1944) and the rules made thereunder, and (c) these rules a drawback may be allowed on the export of goods specified in the Schedule at such amount or at such rates, as may be determined by the Central Government : Provided that where any goods are produced or manufactured from imported materials or excisable materials, on some of which only duty chargeable thereon has been paid and not on the rest, or only a part of the duty chargeable has been paid, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . reduction for import of other embellishments mentioned above". 13. The description of goods on the shipping bills, which in this case was green shipping bill known as Drawback Shipping Bill, was - 100% cotton dyed knitted hosiery code No. 610610,00 100% cotton men's slip Dyed knitted hosiery. 14. The goods were tested and on test the goods were found as per the description of Sr. No. 27.04. (1) There is no allegation that the goods were not made wholly or mainly from cotton knitted hosiery or from viscose yarn within the meaning of Section 50. (2) of Customs Act, 1962 the exporter has to give a declaration to the truth of the contents of the shipping bill. He has to give the declaration which so far as it pertains to the goods exported and the declaration. This appears to be correct because the goods exported were as per contract and as per test report. The drawback is admissible to the goods specially if the goods are covered by description of the Sr. No. 2704 to the schedule. The goods are in fact covered by the description of the goods as given under the Sr. No. 27.04 Now coming back to the Sr. No. 27.04. The note below the Serial No. 2704 prescribes that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation at all, the right course is to impose penalty. As the drawback is on the goods and the goods by description of Serial No. 2704 and Rule 3 are covered, the drawback shall have to be granted. It may be mentioned that in the similar type of a case where goods were manufactured in a factory without taking a Central Excise licence and were being cleared without payment of duty, without accounting the goods in the statutory records. It was held that the goods seized shall be entitled to clearance at the appropriate rate of duty. It cannot be said the exemption is to be denied because the licence was not taken, statutory records were not mentioned, for these violations the right course is to impose penalty. 18. It has been mentioned that there is a contravention of Rule 11 of Customs and Central Excise Duties Drawback Rules. Rule 11 prescribes procedure for claiming drawback on exports. It is a procedural rule which prescribes making a declaration, furnishing of documents, giving description, quantity etc. etc. It is nowhere prescribed under the Customs Act or the Drawback Rules that if there is some discrepancy in the declaration the drawback shall not be admissible and there ..... X X X X Extracts X X X X X X X X Extracts X X X X
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