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TMI Blog2024 (3) TMI 649X X X X Extracts X X X X X X X X Extracts X X X X ..... ocuments and on verification of the export documents the scrips were issued by DGFT. There is no allegation by the DGFT that there had been any suppression or mis-declaration of any of the facts for the issuance of the scrips. Moreover, when the authorities hold that the scrips were valid scrips in the hands of the importers, the question of them becoming invalid in the hands of the exporter appears to be too farfetched. The letter which has been reproduced above categorically states that the exports even though have taken place under chapter heading 03031900 during the relevant period need to be regularised, therefore, since the scrips issuing authority has no objection to accept these shipping bills for the benefit of MEIS the question of denying the benefit by the customs only for the reason that the change in classification is not sustainable. None of the elements in Section 28AAA have been adduced by the Revenue to invoke these provisions after nearly 3 years of the issue of the Public Notice No.27/2015 dated 14.7.2015. Admittedly in all the relevant documents Leather Jacket Fish is the description of the products and therefore, the allegation of mis-declaration does not susta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iable under Chapter Heading 03038999 and therefore, for the period 14.07.2015 to 21.09.2016 the appellant was not eligible for the benefits of MEIS. Accordingly, the Commissioner confirmed the demand of Rs.1,34,51,498/- against the appellant along with interest and imposed penalty of Rs. 13,50,000 under Section 114AA. 2. The Learned Counsel on behalf of the appellant submitted that they exported various kinds of marine products including Leather Jacket Fish which is the impugned product under dispute. It is submitted that when the MEIS scheme was introduced by DGFT with effect from 1.4.2015 both the Chapter Headings 0303 1900 and 0303 8999 were given the benefit of 5% on the FOB value of the exports undertaken. Later, while issuing the Public Notice No. 27/2015-2020 dated 14.07.2015, the Chapter Heading 0303 8999 was deleted from the MEIS schedule. By another Public Notice No.32/2015-2020 dated 22.9.2016, Chapter Heading 03038999 was again added back to the schedule with the benefit of 5%. It is submitted that the impugned order is vague and not specific and it is stated that the appellant is consistent in classifying the goods under Chapter Heading 0303 1900 from 2014 onwards and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that for the period from 14.7.2015 to 21.9.2016, the appellant was not eligible for the benefit of MEIS scrips in view of the DGFT Public Notice No.27/2015 dated 14.07.2015. 4. Heard both sides. The only issue to be decided is whether the appellant is eligible for the benefit of MEIS scrips. MEIS is a scheme designed to provide rewards to exporters to offset infrastructural inefficiencies and associated costs. The Duty Credit Scrips and goods imported/ domestically procured against them shall be freely transferable. The Duty Credit Scrips can be used for: (i) Payment of Basic Customs Duty and Additional Customs Duty specified under sections 3(1), 3(3) and 3(5) of the Customs Tariff Act, 1975 for import of inputs or goods, including capital goods, as per DOR Notification, except items listed in Appendix 3A. (ii) Payment of Central excise duties on domestic procurement of inputs or goods, (iii) Payment of Basic Customs Duty and Additional Customs Duty specified under Sections 3(1), 3(3) and 3(5) of the Customs Tariff Act, 1975 and fee as per paragraph 3.18 of this Policy. Objective of the Merchandise Exports from India Scheme (MEIS) is to promote the manufacture and export of notif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt under MEIS (i) EOUs / EHTPs / BTPs/ STPs who are availing direct tax benefits / exemption. (ii) Supplies made from DTA units to SEZ units (iii) Export of imported goods covered under paragraph 2.46 of FTP; (iv) Exports through trans-shipment, meaning thereby exports that are originating in third country but transhipped through India; (v) Deemed Exports; (vi) SEZ/EOU/EHTP/BPT/FTWZ products exported through DTA units; (vii) Items, which are restricted for export under Schedule-2 of Export Policy in ITC (HS), unless specifically notified in Appendix 3B. (viii)Service Export. (ix) Red sanders and beach sand. (x) Export products which are subject to Minimum export price or export duty. 61 (xi) Diamond Gold, Silver, Platinum, other precious metal in any form including plain and studded jewellery and other precious and semi-precious stones. (xii) Ores and concentrates of all types and in all formations. (xiii) Cereals of all types. (xiv) Sugar of all types and all forms, unless specifically notified in Appendix 3B. (xv) Crude / petroleum oil and crude / primary and base products of all types and all formulations. (xvi) Export of milk and milk products, unless specifically notified in A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icant shall be under obligation to rectify such discrepancy and/or refund over claim in cash with interest at the rate prescribed under section 28AA of the Customs Act 1962, from the date of issue of scrip in the relevant Head of Account of Customs within one month. The original holder of scrip, however, may refund such over claim by surrendering the same scrip whether partially utilized or fully unutilized, without interest. (b) Regional Authority may ask for original proof of landing certificate, annexures attached to ANFs or any other document, which has been uploaded digitally at any time within three years from the date of issue of scrip. Failure to submit such documents in original would make applicant liable to refund the reward granted along with interest at the rate prescribed under section 28AA of the Customs Act 1962, from the date of issuance of scrip. It would be the responsibility of applicant to maintain such documents, certificate etc. for a period of at least three years from the date of issuance of scrips. 6. From the above provisions, it is seen that none of these provisions have been violated by the appellant and there is no such allegation that facts were misre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 100 Shark Fins 90 3061100 Rock Lobster and other Sea Crawfish (Palinurus Sp Panulirus Sp Jasus Sp)Frzn 91 3061210 Whole Cooked Lobsters(Homarus Spp) Frozen 92 3061290 Other frozen Lobster 101 3062100 Rock Lobster And Other Sea Crawfish Not Frozen 102 3062200 Lobster(Homarus Spp) Not Frozen 119 3075100 Octopus (Octopus Spp) Live Fresh/Chilled 120 3075900 Octopus Other Than Live Fresh/Chilled 142 5021010 Pigs,Hogs/Boars Bristls And Hair 7. Let s examine the relevant chapter headings. While the appellant classified under 03031900, the department classified them under 03038999. From the entries given below there is no specific entry for leather jacket fish as such and the appellant had been claiming under CTH 03031900 as per their understanding. Chapter 0303 Fish, Frozen, excluding fish fillets and other fish meat of heading 0304. -Salmonidae, excluding livers and roes: 03031100 Sockeye salmon red salmon -------------------------------------------------------------- -------------------------------------- 03031900- -other -Tilapias, cat fish---------------- - - - other 03038991 - - - - edible fish mask of wild life 03038992 - - - - edible shark fins of wild life 03038999 - - - - others ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was very large whereas what was actually spent was a paltry amount. To be noted that the licensing authority having taken no steps to cancel the licence. The licensing authority have not claimed that there was any misrepresentation. Once an advance licence was issued and not questioned by the licensing authority, the Customs authorities cannot refuse exemption on an allegation that there was misrepresentation. If there was any misrepresentation, it was for the licensing authority to take steps in that behalf. 10. While dealing with the demand against the importers who have utilised the scrips, the Commissioner dropped the demand against all the importers on the ground that these MIES scrips were purchased by the importers from open market and these have changed hands in the open market in a manner sanctioned under law. Besides on the date of importation of the goods, the said scrips were valid, legal and subsisting and the same were used for covering up the duty payable as per law. It is not the case of the investigating agency that scrips were utilised by these importers to defray the duty payments or stood cancelled or suspended at the time of import. Neither has the investigati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e deleted from the benefit of the reward scheme under MEIS. The notice was issued under Section 28AAA the relevant provisions are reproduced below : [Section 28AAA. Recovery of duties in certain cases. (1) Where an instrument issued to a person has been obtained by him by means of- (a) collusion; or (b) wilful misstatement; or (c) suppression of facts, For the purposes of this Act or the Foreign Trade (Development and Regulation) Act, 1992 (22 of 1992), or 2 [any other law, or any scheme of the Central Government, for the time being in force, by such person] or his agent or employee and such instrument is utilised under the provisions of this Act or the rules 3 [or regulations] made or notifications issued thereunder, by a person other than the person to whom the instrument was issued, the duty relatable to such utilisation of instrument shall be deemed never to have been exempted or debited and such duty shall be recovered from the person to whom the said instrument was issued: Provided that the action relating to recovery of duty under this section against the person to whom the instrument was issued shall be without prejudice to an action against the importer under Section 28. E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ps were valid scrips in the hands of the importers, the question of them becoming invalid in the hands of the exporter appears to be too farfetched. The letter which has been reproduced above categorically states that the exports even though have taken place under chapter heading 03031900 during the relevant period need to be regularised, therefore, since the scrips issuing authority has no objection to accept these shipping bills for the benefit of MEIS the question of denying the benefit by the customs only for the reason that the change in classification is not sustainable. None of the elements in Section 28AAA have been adduced by the Revenue to invoke these provisions after nearly 3 years of the issue of the Public Notice No.27/2015 dated 14.7.2015. 14. The Supreme Court in the case of Northern Plastics Ltd. Vs. Collector of Customs and Central Excise: 1998 (101) ELT 549 (SC), wherein in para 21 and 22 held as follows: 22. As the goods imported by the appellant were being used and intended to be used as Cinematographic Film, the appellant had described them as Cinematographic Films covered by sub-heading 3702.20. No attempt was made by the customs authorities either before the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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