Tribunal allows conversion of consignment from duty drawback to advance licence scheme

The Tribunal ruled in favor of the appellants, allowing the conversion of part of the consignment from duty drawback scheme to advance licence scheme. The denial based on already benefiting from duty drawback was deemed unsustainable as the appellants were willing to repay it. The Circular cited did not prohibit conversion, and since part of the consignment was under advance licence, conversion was justified. The Tribunal directed authorities to process the conversion promptly, emphasizing that export obligations under the advance licence should not impede the process.

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Issues:
Appeal against denial of conversion of shipping bill from duty drawback scheme to advance licence scheme.

Analysis:
The appellants filed a shipping bill for export under advance licence cum duty drawback scheme but later requested conversion of part of the consignment to advance licence scheme. The denial was based on the fact that they had already benefited from the duty drawback scheme before making the request, and they were not entitled to conversion as per a specific Board Circular. The appellant argued that they were willing to repay the duty drawback claimed with interest and that their conversion request was not denied by relevant authorities. They contended that since part of the consignment was already under advance licence scheme, conversion should be allowed. The opposing party argued that the appellants cannot receive double benefits and that the export obligation under the advance licence had already been fulfilled.

The Tribunal considered the submissions and found that the appellants were willing to repay the duty drawback, making the denial on that ground unsustainable. They also noted that the Circular cited did not preclude conversion, as it was not denied by the relevant authorities. The Tribunal emphasized that part of the consignment was under advance licence, and all necessary examinations were conducted during export. Therefore, the conversion should not be denied solely on the basis of export obligations already fulfilled. The Tribunal set aside the impugned order and allowed the appeal, directing the authorities to process the conversion within a specified timeline in accordance with the Customs Act, 1962.

In conclusion, the Tribunal ruled in favor of the appellants, highlighting their willingness to repay the duty drawback and the lack of denial from relevant authorities for the conversion request. The Tribunal emphasized that the fulfillment of export obligations under the advance licence should not hinder the conversion process, as the Revenue would still recover the amount paid under the duty drawback scheme. The decision provided consequential relief to the appellants, instructing the authorities to facilitate the conversion process promptly.

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