Conversion of shipping bills on merits under customs law required fresh consideration where export documents and remittance evidence were available.

Conversion of free shipping bills into drawback shipping bills under the customs circular and Section 149 of the Customs Act had to be considered on merits where the exported goods were factory stuffed under Central Excise supervision and supporting export documents, including foreign inward remittance evidence, were available. On those facts, the discretion under the circular should have been exercised after examining the request substantively, and the refusal was found unsustainable. The matter was therefore remanded for fresh consideration of the alternate request for conversion into drawback shipping bills at All Industry Rates.

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Issues: Whether the request for conversion of free shipping bills into drawback shipping bills was required to be reconsidered on merits under the governing customs circular and Section 149 of the Customs Act.

Analysis: The exported goods were factory stuffed under the supervision of Central Excise authorities and the supporting export documents and foreign inward remittance evidence were available. In these circumstances, the discretion contemplated under the customs circular governing conversion of shipping bills ought to have been exercised after examining the matter on merits. The refusal was therefore found to be unsustainable, and the matter was required to be sent back for fresh consideration of the alternate request for conversion into drawback shipping bills at All Industry Rates.

Conclusion: The request for conversion was not finally rejected by the Tribunal and the Commissioner was directed to reconsider the matter afresh in accordance with law.

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