Export obligation under EPCG scheme can be discharged by prescribed SEZ documents without insisting on an extra bill of export.

Supplies to a Special Economic Zone unit were treated as fulfilment of export obligation under the EPCG scheme because the licence was expressly subject to the Exim Policy and the Handbook of Procedures. The prescribed proof under Paragraph 5.13(b) of the Handbook required supply invoices and payment through the normal banking channel, while Rule 23 of the SEZ Rules extended export benefits to authorised supplies. On that framework, compliance in the manner specified by the scheme was sufficient, and an additional bill of export could not be insisted upon. The appellant was therefore treated as having discharged the export obligation, and the adverse orders were set aside.

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Issues: Whether supplies made to a Special Economic Zone unit could be treated as fulfilment of export obligation under the EPCG scheme on the basis of the Handbook of Procedures and the SEZ Rules, and whether the authorities could insist upon a bill of export in addition to the prescribed documents.

Analysis: The EPCG licence expressly made the authorisation subject to the Exim Policy and the Handbook of Procedures. Paragraph 5.13(b) of the Handbook of Procedures governing deemed exports requires supply invoices and proof of payment through the normal banking channel, while Rule 23 of the Special Economic Zones Rules, 2006 extends export benefits to supplies to a unit or developer for authorised operations. On that framework, the prescribed manner of proving compliance was through the documents contemplated by the Handbook, and not by insisting on an additional bill of export. Where a procedure is laid down for doing an act, the act must be done in that manner alone and not otherwise.

Conclusion: The appellant had discharged the export obligation in the manner prescribed, and the insistence on a bill of export was unsustainable.

Final Conclusion: The impugned orders were set aside and the appellant obtained relief.

Ratio Decidendi: When the governing licence and procedural scheme prescribe a specific mode for proving discharge of export obligation, compliance in that prescribed mode is sufficient and additional requirements not contemplated by the scheme cannot be imposed.

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