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TMI Blog2024 (12) TMI 369X X X X Extracts X X X X X X X X Extracts X X X X ..... From India Scheme (MEIS) was permitted as all other relevant material available as the petitioner before the Court was eligible for the benefit of MEIS. It was observed by the Court that ' The respondents are, therefore, not justified in turning down the request to convert the shipping bills of the petitioner from free to MEIS and thereby depriving the petitioner of the benefits under the MEIS in respect of exports made under such shipping bills.' This Court in case of Bombardier Transportation India Pvt. Ltd. vs. Directorate General of Foreign Trade [ 2021 (3) TMI 9 - GUJARAT HIGH COURT ], has held that in similar facts that the EDI system, which is an electronic system developed and managed by the respondent authority with an objective to digitalize transmission of shipping bills between respondents, suffers from lacunae that it does not permit amendment, which is specifically permitted in terms of Section 149 of the Customs Act, 1961 to be carried electronically through EDI system and in view of settled law that the benefit which otherwise a person is entitled to once the substantive conditions are satisfied cannot be denied due to technical error or lacunae in the elect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 5. 2. By this petition under Article 226 of the Constitution of India, the petitioner has prayed for the following reliefs:- (a) that this Hon'ble Court may be pleased to issue a writ of mandarnus or a writ in the nature of mandamus, a writ of certiorari or a writ in the nature of certiorari or any other appropriate writ, order or direction directing Respondent No. 2 or his officers to grant benefit under MEIS scheme and setting aside the impugned order dated 17.01.2023 passed by Respondent No. 3. (Exhibit-1). (b) that this Hon'ble Court may be pleased to issue a writ of mandamus or a writ in the nature of mandamus, a writ of certiorari or a writ in the nature of certiorari or any other appropriate writ, order or direction directing Respondent No. 4 or his officers including Respondent No. 5 to amend the Shipping Bills manually and allow the Petitioners to claim benefit under the said MEIS scheme. (c) that this Hon'ble Court may direct the Respondents to allow modification in the online system to enable the Petitioners to correct the technical error by allowing selection table Yes for shipping bill to be under reward scheme and process the application to grant expo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essed with default option NO without selection Yes for making exports under reward scheme i.e. MEIS as a result of which exports are not considered for export incentive benefit which otherwise the petitioners are entitled for the same. 10. On realising this technical error, the petitioners first approached respondent no. 3 - Policy Relaxation Committee vide letter dated 11.03.2019 and filed an application to seek policy/procedure relaxation in terms of para no. 2.58 of the Foreign Trade Policy to rectify the reward column from No to Yes . 11. Respondent no. 3 vide email dated 29.03.2019 asked the petitioners to remain personally present on 2.04.2019 on which day, the petitioner appeared before respondent no. 3 and made submissions. However, petitioner s claim was negated. 12. It is the case of the petitioner that on inquiry, it was informed that the claim was rejected because shipping bills indicating NO were not amended to YES . The petitioner therefore, vide letter dated 24.05.2019 made a request to respondent no. 4 for amending the Shipping Bills under section 149 of the Customs Act, 19672 to correct the inadvertent mistake of marking N instead of Y . 13. However respondent no. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orate General, Policy Relaxation Committee respondent no. 3 vide email dated 17.01.2023. 22. Aggrieved by the decision of respondent no. 3, the petitioner has preferred the present petition. 23. Learned advocate Mr. Anand Nainawati for the petitioner submitted that when actual physical export is not in dispute, the petitioners are entitled for MEIS benefit. 24. Referring to para 3.04 of the Foreign Trade Policy it was submitted that the petitioners have satisfied all the conditions of the MEIS Scheme. 25. Learned advocate Mr. Nainawati referred to the items listed in Appendix-3B of Foreign Trade Policy which are entitled for MEIS benefits to submit that the goods exported by the petitioners are covered within Appendix-3B and that they have earned the foreign exchange in respect of those exports. 26. It was further submitted that as per para 3.03 of the Foreign Trade Policy, wherever the rewards under MEIS is available to all countries, proof of landing is not required to be submitted. 27. It was submitted that the export made by the petitioners are not barred from rewards of MEIS Scheme as it does not fall within the categories/sectors enumerated in para 3.06 of the FTP as under: a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the CHA for not changing default option of NO to YES . 31. Learned advocate Mr. Nainawati referring to section 149 of the Customs Act, 1962 which empowers the proper officer of the customs to amend the documents after the goods are exported on the basis of the documentary evidence on record, submitted that when amendment to shipping bill after export of the goods is sought, the same is governed by the proviso to section 149 and if the requirements of the proviso of section 149 are satisfied, the amendment has to be allowed. 32. It was further submitted that as per section 149 of the Customs Act, based on the export documents like ARE-1 and shipping bills, at the time of export, amendment to the shipping bills can be allowed and accordingly the amendment in the shipping bills have been allowed by respondent no. 5 , however physically copy of the amended shipping bills were not provided and MEIS benefit was not granted till date. It was therefore, submitted that rejection of MEIS benefit on the ground of procedural lapse is not tenable in eye of law and therefore the impugned order is required to be quashed and set aside. 33. Learned advocate Mr. Nainawati referred to para 2.58 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order of CESTAT, request of the petitioner for amendment from NO to YES in MEIS was approved and same was communicated to the petitioner vide letter dated 11.08.2022, however, it was also informed to the petitioner that the system does not allow/permit any online amendment in shipping bills after completion of export and filing of EGM. 38. It was further submitted that in September, 2023, the Directorate General of Systems and Data Management, Central Board of Indirect Taxes and Customs under the Ministry of Finance, Government of India enabled the functionality in ICES for MEIS amendment post filing of EGM and accordingly, the Customs department amended the shipping bills of the petitioner and has already electronically transmitted the data in respect of the shipping bills of the petitioner to the Directorate General of Foreign Trade. 39. Having heard learned advocates for the respective parties and considering the facts of the case, it is not in dispute that the petitioner is eligible for the export benefit under the MEIS in law and as per the notification of the scheme. 40. Chapter 3 to the Foreign Trade Policy, 2015-2020 provides for export incentives under MEIS to the exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rips and the basis for calculation of these rewards would be on realised FOB value of export in free foreign exchange. Para 3.04 of the FTP reads as under: 3.04 Entitlement under MEIS Exports of notified goods/products with ITC[HS] code, to notified markets as listed in Appendix 3B, shall be rewarded under MEIS. Appendix 3B also lists the rate(s) of rewards on various notified products [ITC (HS) code wise). The basis of calculation of reward would be on realized FOB value of exports in free foreign exchange, or on FOB value of exports as given in the Shipping Bills in freely convertible foreign currencies, whichever is less, unless otherwise specified. 44. Items entitled for MEIS benefits are listed in Appendix-3B of the FTP as under: MEIS Sr. No. Handicraft Flag ITC HS 2017 ITC HS 2017 Description ITC HS 2012 ITC HS 2012 Description MEIS Rate 5420 76129090 Other 76129090 Other Containers: NES. 2 45. Thus the goods exported by the petitioners are covered within Appendix-3B and petitioner has earned the foreign exchange in respect of those exports. It is also not in dispute that the petitioners have satisfied the substantive conditions for the entitlement of the benefit of MEIS Sche ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... holding the denial of the petitioner's claim for amendment of its shipping document under section 149 of the Customs Act. The court held thus: 7. In the present case, the appellant had been consistently dealing with the same goods and exporting them previously for over three years. The pre-condition of a declaration along with the relative forms, for grant of benefit was introduced on 142008 through an amendment to the Handbook of Procedures. It is now settled law that the provisions of the Foreign Trade (Development Regulation) Act, 1992, the rules or regulations framed thereunder and the export import policy have the force of law. Handbook of Procedures and the amendments carried out thereto are per se not declaration of law but only impose conditions which are to be fulfilled and otherwise conform to the requirements of law. Without making a deeper analysis of these legal provisions, the facts of this case reveal that the export goods are essentially agricultural produce and continued to be covered as an item eligible for benefit. At the time, just prior to 142008, the goods had been exported as free shipping bills. The exporter/appellant's fault here is that it did not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of intent' when all other relevant material is available, is not fatal to the petitioner's case. As in the case of Kedia (Agencies) Pvt. Ltd. v. Commissioner of Customs (supra), in the facts of the present case also, in all other respects, that is, as to whether the goods conform to the description in the shipping documents and the value, etc. continues to be ascertainable because the concerned bills, invoices and other shipping documents are available with the customs authorities. The respondents are, therefore, not justified in turning down the request to convert the shipping bills of the petitioner from free to MEIS and thereby depriving the petitioner of the benefits under the MEIS in respect of exports made under such shipping bills. 49. This Court in the case of Oriental Carbon And Chemicals Limited vs. Union Of India, reported in 2021 (377) E.L.T 850 (Guj) has held as under:- 21. Section 149 of the Customs Act, 1962, specifically permits amendment of the shipping bills even after the export on the basis of the documentary evidence which was in existence at the time the goods were exported. There is no restriction in the said provision for not allowing the amendment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, in the case of Principal Commissioner of Customs vs. M/s. Lykis Limited, 2021 (2) TMI 261 , has upheld the Tribunal s judgment holding that when no time limit is prescribed in Section 149 of the Customs Act, 1962, no such time limit can be fixed by way of a circular. 26. In the case of M/s. Mahalaxmi Rubtech vs. UOI, (SCA No.21636 of2019, decided on 2.3.2021), this Court upheld that the Circular is ultra vires Articles 14, 19 (1) (g) of the Constitution and Section 149 of the Customs Act, 1962. Therefore, the said Circular cannot be relied upon. 27. In the present case, the authorities had themselves sought clarification from the DGFT as to whether such declaration was mandatory prior to 1.6.2015 and were awaiting such clarification. The authorities had even issued three scrips to the writ-applicant against six of its applications, which were later suspended while awaiting such clarification. Hence, it is not correct to blame the writ-applicant for not having sought amendment immediately. 28. Unlike in other cases, in the present case, no authority issued any communication to the writ-applicant to seek amendment of the shipping bills under Section 149 of the Customs Act, 1962. E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Market Scheme (FMS) and has subsequently also exported the very same goods and claimed the benefits under the MEIS scheme. 33. The only lapse is with regard to the inadvertent nonmention of the declaration of intent as per Clause 3.14 of the Handbook of Procedures during the period between 1.4.2015 and 31.3.2015, i.e. during the initial period of the FTP, 2015-20. 34. The writ-applicant's shipping bills were non-EDI only because the Mundra Port was not an EDI port. 35. This lapse being a technical or a procedural lapse, the writ-applicant should not be denied substantive benefits, as held by this Court in the case of Bombardier Transportation India Pvt. Ltd. (supra). 36. The authorities themselves were not sure whether the declaration was mandatory prior to 1.6.2015 as is evident from the following : (a) Public Notice No. 40/2015-20 dated 9.10.2015 wherein, in para 3, it is stated that such declaration is mandatory from 1.6.2015. (b) The authorities had even issued three scrips to the writ-applicant against six of its applications. (c) The authorities had, in fact, sought clarification from the DGFT as to whether the declaration was mandatory prior to 1.6.2015. 37. The authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the sides and also on a carefully considering the chronology of events, we notice that it is a genuine mistake on the part of the petitioner which has led the petitioner approaching this Court for prayer of permitting the bill manually. We notice that the respondent Nos.1 and 2 had permitted the manual amendment of shipping bill in question being the shipping bill bearing No. 5 561585 dated 14.06.2018 while filing shipping bill online in EDI system of the customs inadvertently systems had got been corrected value of goods exported as has been noted by the PRC Committee in its meeting. A representation made had weighed with the said Committee. The Customs, Mundra had assessed and finalized the consignment, however, the amendment since had not been reflected in EDI systems of the DGFT, that resulted in preventing filing the MEIS claim. Hence, the Committee in its report dated 30.10.2018 had referred the matter to EDI / NISD for DGFT to make suitable provisions to grant MEIS benefits against the same shipping manually. The Committee had also reviewed on 24.09.2019 on the basis of the comments received from E-Governance and Trade Facilitation (EGTF) section and observed that the reflec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... permit the petitioner to allow the filing of declaration in form GST TRAN-1 so as to enable them to claim transitional credit of the eligible duties in respect of the inputs held in stock on the appointed day in terms of Section 140 (3) of the CGST Act. 54. This Court in case of M/S Shree Renuka Sugars Ltd vs. Union Of India, reported in 2023 (4) TMI 789 in similar facts of granting benefit under RoDTEP scheme has issued the following directions:- 5. As the controversy unfolds as above, the court is of the view that the following directions would serve the ends of justice. Accordingly it is provided that, (i) The petitioner shall be entitled to claim the RoDTEP Scheme benefit in respect of the exports of white refined sugar at the rate permissible. Even if such benefit is not claimed or mentioned in the shipping bills, the petitioner is permitted to make necessary application seeking such benefit in respect of the consignments concerned. (ii) The passage of time in making such applications which would occur as amount would not be mentioned in the shipping bills, would not render the claim of the petitioner time barred. (iii) The non-mentioning of the claim of the benefit in the shi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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