Advance licence export obligation cannot be discharged by later application without the required shipping bill declaration.

An export cleared under Section 51 of the Customs Act, 1962 cannot be retrospectively linked to a later advance licence application for discharge of export obligation where the prescribed shipping bill declaration was not filed. Regulation 4 of the Shipping Bill and Bill of Export (Form) Regulations, 1991 required particulars of the advance licence application in Annexure III, and that declaration was absent when the goods left the exporter's control. A subsequent endorsement on the shipping bill could not cure the defect or validate entry of the consignment in the DEEC book for fulfilment of the export obligation.

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Issues: Whether export goods permitted for export under Section 51 of the Customs Act, 1962 could be treated as exported for discharge of advance licence export obligation when the relevant application to DGFT was filed only after export and the shipping bill declaration required by the regulations was not filed correctly.

Analysis: The export was permitted under Section 51 of the Customs Act, 1962, after which the goods went out of the exporter's control. By that time, no application had been filed with DGFT for a value based advance licence. Regulation 4 of the Shipping Bill and Bill of Export (Form) Regulations, 1991 required a declaration in Annexure-III giving the particulars of the advance licence application, which was absent. The export was therefore wrongly shown as having been made against the later licence application, and the consignment was wrongly entered in the DEEC book for fulfilment of export obligation under Para 66 of the Import and Export Policy, 1992-1997. The order of the adjudicating authority had ignored these legal requirements and the admitted subsequent endorsement on the shipping bill.

Conclusion: The export could not be treated as satisfying the advance licence conditions, and the Commissioner's order dropping the proceedings was unsustainable.

Final Conclusion: The Revenue's challenge succeeded and the adverse order was set aside.

Ratio Decidendi: An export completed upon permission for clearance under Section 51 of the Customs Act, 1962 cannot be retrospectively linked to a later advance licence application for discharge of export obligation unless the prescribed declaration accompanies the shipping bill in accordance with the applicable regulations.

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