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TMI Blog2021 (4) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... Credit Scrips to the petitioner after extending the validity thereof for a period of 18 months from the date of such return of the said Duty Credit Scrips. (ii) To issue to the petitioner Duty Credit Scrips under the provisions of the Merchandise Exports from India Scheme in the Foreign Trade Policy, 2015-20 against the petitioner's applications bearing File Nos.37/21/090/00174/AM16, 37/21/090/80077/AM17 and 37/21/090/80078/AM17. (B) Your Lordships be pleased to issue a writ of or in the nature of mandamus or any other writ, order or direction directing the respondents to allow the petitioner to amend the shipping bills mentioned in Annexure-G herein above, by permitting the following declaration to be inserted on the shipping bills : "We intend to claim rewards under Merchandise Exports from India Scheme (MEIS)" and/or by issuing appropriate amendment certificates to this effect. (C) Such other and further reliefs as deemed just and proper in the facts and circumstances of the present case be granted." 2. The facts giving rise to the present litigation are as under : (a) The writ-applicant is engaged, inter alia, in the business of exporting Insoluble Sulphur fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... However, against these three applications (i.e. applications bearing File Nos.37/21/090/00005/AM16, 37/21/090/00065/AM16 and 37/21/090/00172/AM16), three scrips/licenses (bearing nos. 3719000681/0/36/00, 3719000682/0/36/00 & 3719000683/ 0/36/00 respectively) aggregating Rs. 20,01,236/- were thereafter issued by the concerned authorities in June 2016, which confirmed the writ-applicant's understanding of nonrequirement/ relaxation of declaration of intent for the period in question. However, on that day, the said three scrips were put under suspension on the ground that a clarification was awaited from the DGFT, New Delhi, in regard to whether the non-EDI shipping bills prior to 1.6.2015 without the declaration of intent were eligible for the MEIS benefits. The writ-applicant was asked to surrender the scrips. Accordingly, the writ-applicant was left with no other choice but to surrender the said three scrips on 28.7.2016. On the basis of the same, since there was no declaration on the shipping bills, no scrips were issued to the writ-applicant against the rest of its applications bearing the File Nos. 37/21/090/00174/AM16, 37/21/090/80077/AM17 and 37/21/090/80078/AM17 respectively. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... making personal inquiry, the writ-applicant was informed that the matter was under active consideration by the DGFT and that no action could be taken till such clarification was issued by the DGFT. Time and again, the writ-applicant followed up and made personal representations to all authorities. (j) The writ-applicant also addressed a letter to the Additional DGFT, New Delhi, requesting for revocation of the suspension of the scrips. However, there was no response from the office of the DGFT and it was understood that the issue was under active consideration by the DGFT in light of its public notices issued in respect of the exports made from the EDI ports. (k) All of a sudden, in August 2018, the office of the Development Commissioner, Kandla SEZ, addressed three letters in respect of the three pending applications bearing File Nos.37/21/090/00174/AM16, 37/21/090/80077/AM17 and 37/21/090/80078/AM17, stating that the writ-applicant was required to remove the deficiency in regard to the MEIS declaration not having been mentioned on all the shipping bills within 30 days otherwise the case would be treated as closed. Since the writ-applicant's office had shifted to another loc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The incentive under the MEIS is in the form of freely transferable Duty Credit Scrips granted as a reward to the exporter to compensate for his loss on payment of duties. The Duty Credit Scrips can be used for payment of customs duty or excise duty or service tax as stated in the Scheme. The incentive is paid as a percentage of the realized FOB value (in free foreign exchange) for notified goods going to notified markets as listed in Appendix-3B to the Handbook of Procedures. To determine the quantity of incentive, the countries have been segregated into three groups. Incentives on exports of each product at 8-digit level (ITC HS Codes) depend on the group in which its destination country belong. The objective of the MEIS is to enhance India's export competitiveness and it promotes exports of products listed in Appendix-3B to the Handbook of Procedures. (b) Chapter 3 of the Handbook of Procedures provides for the procedure for claiming incentives under the MEIS. As per the same, an application for claiming rewards is required to be filed on-line on the website of the Directorate General of Foreign Trade (for short, 'the DGFT') in the prescribed form ANF-3A and the relevan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lows electronic processing of export documents), the exporter were required to tick "Y" in the reward box in case the exporter intended to claim the benefits under the MEIS and "N" in case they did not intend to claim such benefits. In the non-EDI shipping bills, the declaration was manual one on the shipping bills, stating the words: "We intend to claim rewards under Merchandise Exports from India Scheme (MEIS)". 8. A public notice bearing No.40/2015-20 dated 9.10.2015 was issued by the DGFT, inter alia, stating that, in exercise of the powers conferred under paragraph 1.03 of the FTP read with paragraph 3.14 of the Handbook of Procedures, the DGFT exporters who had inadvertently marked "N" instead of "Y" but intended to claim the MEIS benefits, to submit physical copies of the free shipping bills at the time of submission of the application for the MEIS rewards and directing the regional authorities to grant the MEIS rewards after examination of such shipping bills. It was even stated in the public notice that the aforesaid declaration of intent on the shipping bills was mandatory with effect from 1.6.2015. Thus, the DGFT provided relief to the exporters who had exported goods t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he authorities at Kandla to seek the necessary clarification from the DGFT. Hence, the writ-applicant could not have been denied the MEIS benefits on this ground. 10. Ms.Thakore would further submit that in any case, the requirement of the declaration of intent to claim the MEIS benefits is at best a procedural or a technical requirement as contained in the Handbook of Procedures which merely lays down the procedure to be followed for the purpose of implementing the FTP. The said provision of the declaration of intent is only for the purpose of internal convenience of the authorities, i.e. for the purpose of internal communication/ transmission of shipping bills containing such declaration from the Customs authorities to the DGFT. It is a procedural requirement and, therefore, not mandatory. The failure thereof should not entail harsh consequences upon an exporter. It is at best a directory requirement and non-mention thereof is an inadvertent procedural lapse/defect which can be waived or cured. 11. She would further that the authorities have ample powers to grant relaxation/waiver and have, in fact, granted appropriate relaxation/waiver in case of the EDI ports. Therefore, even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plicant for not having sought the amendment within 3 months. 14. Ms.Thakore would submit that the respondents' contention that free shipping bills are subject to nil examination norms or different examination norms is incorrect and untenable since : (i) the Customs Act, 1962, contains several safeguards as provided by Sections 39 to 42, 50 and 51 thereof, under which, the authorities are duty bound to duly pass all the shipping bills before any goods can be exported and are required to ascertain, whether the goods are prohibited for export before permitting the clearance of any goods for export; (ii) the authorities are required to issue entry outwards to the vessels carrying export goods before the vessels can be loaded and are required to issue a written order permitting the vessel to leave the port after all the procedures are duly completed, (iii) the goods covered by writapplicant's shipping bills were, in fact, examined as borne out from the endorsements made on the shipping bills; and (iv) the respondent's reliance upon rule 46(1)(c) of the SEZ Rules as amended vide Notification dated 19.9.2018 is completely misplaced since the exports in question were during the period bet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich prescribes three months time limit. 17. In the last, it is submitted that vide public notice bearing No.40/2015-20 dated 9.10.2015 and public notice bearing No.47/2015-20 dated 8.12.2015 respectively, the relaxation was granted in the case of the EDI shipping bills not containing declaration only because the electronical filing was being done for the first time and, therefore, the similar relaxation in the case of the non-EDI shipping bills cannot be granted. ANALYSIS : 18. Having heard the learned counsel appearing for the parties and having gone through the materials on record, the only question that falls for our consideration is, whether the writapplicant is entitled to the reliefs as claimed in his writapplication. 19. With respect to the first objection raised on behalf of the respondents, we may only say that the goods covered by writapplicant's shipping bills were, in fact, examined as borne out from the endorsements made by the authorities on the shipping bills. The Customs Act, 1962, provides for several safeguards as contained in Sections 39 to 42, 50 and 51 respectively, under which the authorities are duty bound to duly pass all the shipping bills before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. UOI, (SCA No.7500 of 2019 decided on 21.1.2020), wherein this Court had allowed the petition, inter alia, holding that whether the goods confirm to the description, etc. is ascertainable from the shipping bills, invoices, etc. available with the Customs authorities; (iv) Delhi High Court judgment in the case of Kedia Agencies vs. Commissioner of Customs, reported in 2017 (348) ELT 634 (Del); (v) Madras High Court judgment in the case of Pasha International vs. Commissioner of Customs, reported in 2019 (365) ELT 669 (Mad); (vi) Madras High Court judgment in the case of Global Calcium vs. Asst. Commissioner of Customs, reported in 2019 (370) ELT 176 (Mad); and (vii) Madras High Court judgment in the case of P.A. Footwear vs. DGFT, reported in 2020 (372) ELT 660 (Mad)]. 23. The aforenoted decisions squarely cover the present matter. 24. So far as the second objection raised on behalf of the respondents is concerned, we may only say that Section 149 of the Customs Act, 1962 does not prescribe any time limit. In fact, at the relevant point of time, it did not even provide for the fixation of the time limit by way of rules or regulations. Therefore, no time limit can be read into th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he authorities and when the authorities themselves have never asked the writ-applicant to amend the shipping bills under Section 149 of the Customs Act, 1962, and have only asked to remove the defect and that too as late as in August 2018. 29. Even in the case of M/s. Gokul Overseas (supra), there was a delay. However, this Court, vide judgment dated 21.1.2020, allowed the petition, inter alia, holding that, whether the goods confirm to the description, etc is ascertainable from the shipping bills, invoices, etc. available with the Customs authorities. 30. So far as the last objection raised on behalf of the respondents is concerned, we may observe that in the case of the EDI shipping bills, the declaration is by ticking "Y" (for Yes) in the reward column, which was not done by several exporters who had exported through the EDI ports. This was the exporter's mistake as well as the inadvertent omission of declaration on the shipping bill in the case of the non-EDI shipping bills. Therefore, to discriminate between the two would be unreasonable and unfair. 31. There is no dispute that the writ-applicant is eligible to claim the benefits under the MEIS since it has admittedly e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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