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TMI Blog2022 (11) TMI 1286X X X X Extracts X X X X X X X X Extracts X X X X ..... (5)] in the manner specified in the said Rule. A case where duty drawback has been paid to the exporter [in the instant case, the petitioner], but admittedly, up until now, sale proceeds have not been received against such exports, and therefore the deeming provision incorporated in the second (2nd) proviso to Section 75 of the Act will kick in - since the amount, which is lying credited to the petitioner s account, concededly, represents a part of the duty drawback sanctioned in favour of the petitioner against 20 shipping bills, no such direction can be issued which would result, ultimately, in the petitioner, at this stage, getting access to those funds. The petitioner s assertion vis-a-vis these summons is, that it remained available at the given premises, and for this purpose, it has placed reliance on a rent agreement dated 16.09.2020 - these are not the aspects up for adjudication, in this writ petition - the petitioner will be free to operate the impugned bank account, as at the moment, there is no legal impediment, given the fact that the provisional attachment orders which were issued to make course correction have outlived their legal efficacy. Petition disposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmunication was issued. 9. It is this, which brought the petitioner to the Court. 10. The petitioner has assailed the impugned communication on the ground, that it has been issued without the authority of law. 10.1 Inter alia, the provisions of Section 110 of the Customs Act, 1962 [in short Act ] were adverted to, on behalf of the petitioner. 11. Upon the official respondents/revenue filing a counter-affidavit [and other additional affidavits] in the matter, what emerged was, that according to the official respondents/revenue, the petitioner had illegally availed duty drawback, against overvalued exports. 11.1 The stand of the official respondents/revenue is, that based on the intelligence developed by DRI, Mumbai, it surfaced that the petitioner was part of a syndicate, which was involved in fraudulent/unlawful availment of duty drawback, by taking recourse to bogus dummy Importer Exporter Codes [ IECs ]. 11.2 The IECs, according to the official respondents/revenue, were fraudulently obtained by misleading certain innocent persons. 12. The official respondents/revenue have alleged, that the syndicate has obtained 124 IECs, which represent exports worth Rs.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 08.2021 expired [after the issuance of the second provisional attachment order dated 18.02.2022] on 23.08.2022. 19. Therefore, the situation which obtains today, is that while the writ petition assails the impugned communication, the official respondents/revenue have brought on record provisional attachment orders [referred to hereinabove], to which no challenge has been laid. 20. The stand of the petitioner, however, is that if in the first instance the action was contrary to law, the same could not have been cured by issuance of subsequent provisional attachment order. 21. Whether there is force in this submission or not, is an aspect which need not detain us, at this juncture, because, as noticed above, even the extended statutory timeframe provided under Section 110(5) of the Act has expired. 22. Therefore, according to us, the only issue which needs to be considered is: whether we should allow the petitioner to take benefit of the duty drawback amounting to Rs.49,23,635/- lying credited in its bank account, while the adjudication is on? 23. During the course of arguments, Ms Makhija placed before us, a sample hard copy of the Let Export Order [ LEO ]. 23.1 A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under [clause (a) of section 84] and in respect of which an order permitting clearance for exportation has been made by the proper officer], a drawback should be allowed of duties of customs chargeable under this Act on any imported materials of a class or description used in the [manufacture or processing of such goods or carrying out any operation on such goods], the Central Government may, by notification in the Official Gazette, direct that drawback shall be allowed in respect of such goods in accordance with, and subject to, the rules made under sub-section (2): PROVIDED that no drawback shall be allowed under this sub-section in respect of any of the aforesaid goods which the Central Government may, by rules made under sub-section (2), specify, if the export value of such goods or class of goods is less than the value of the imported materials used in the [manufacture or processing of such goods or carrying out any operation on such goods] or class of goods, or is not more than such percentage of the value of the imported materials used in the [manufacture or processing of such goods or carrying out any operation on such goods] or class of goods as the Central Governmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stant Commissioner of Customs or Deputy Commissioner of Customs, as the case may be, shall pass an order to recover the amount of drawback paid to the claimant and the exporter shall repay the amount so demanded within thirty days of the receipt of the said order: Provided that where a part of the sale proceeds has been realised, the amount of drawback to be recovered shall be the amount equal to that portion of the amount of drawback paid which bears the same proportion as the portion of the sale proceeds not realised bears to the total amount of sale proceeds. (3) Where the exporter fails to repay the amount under sub-rule (2) within said period of thirty days referred to in sub-rule (2), it shall be recovered in the manner laid down in rule 17. (4) Where the sale proceeds are realised by the exporter after the amount of drawback has been recovered from him under sub-rule (2) or sub-rule (3) and the exporter produces evidence about such realisation within a period of three months from the date of realisation of sale proceeds, the amount of drawback so recovered shall be repaid by the Assistant Commissioner of Customs or Deputy Commissioner of Customs, as the case m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to agree with this submission of Ms Makhija; with the caveat that recovery, as emanating under Rule 18, has to be made in the manner prescribed under Rule 17, as indicated in Rule 18(3) of the 2017 Rules. 33.1 This is clearly, as demonstrated by the facts recorded above, a case where duty drawback has been paid to the exporter [in the instant case, the petitioner], but admittedly, up until now, sale proceeds have not been received against such exports, and therefore the deeming provision incorporated in the second (2nd) proviso to Section 75 of the Act will kick in. 33.2 The provision, in no uncertain terms stipulates that in such situation, the duty drawback is deemed never to have been allowed. 34. Therefore, since the amount, which is lying credited to the petitioner s account, concededly, represents a part of the duty drawback sanctioned in favour of the petitioner against 20 shipping bills, no such direction can be issued which would result, ultimately, in the petitioner, at this stage, getting access to those funds. 35. As noted right in the beginning, no consequential relief has been sought in the writ petition. 36. Therefore, while we agree with Ms Makhija, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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