DEPB credit jurisdiction: Customs cannot cancel registration or raise duty demand where DGFT holds the controlling power.

Customs authorities were held not competent to cancel DEPB registration or recover customs duty on the ground that exported goods fell outside the relevant Standard Input Output Norms. The power to determine, modify, or withdraw DEPB credit lay with the DGFT, while Customs was limited to verifying the exporter's declaration, quantity, and value of the export goods and, if excess or inadmissible credit was suspected, informing DGFT for action. Applying an earlier Tribunal ruling on the same jurisdictional issue, the cancellation of the DEPB registration and the duty demand were set aside.

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Issues: Whether the Customs authorities had the power to cancel the registration of DEPB licences and sustain recovery of customs duty on the footing that the exported goods were not covered by the relevant Standard Input Output Norms, and whether the consequential cancellation and demand could stand.

Analysis: The Tribunal held that the power to determine, modify, or withdraw DEPB credit lies with the DGFT authorities, while the Customs authorities are confined to verification of the exporter's declaration, quantity, and value of the export goods. Where excess or inadmissible credit is suspected, the Customs authorities are required to inform the DGFT for appropriate action. In the present case, the dispute was found to be covered by the earlier Tribunal ruling on the same jurisdictional question, and the Customs authorities were found not competent to cancel the DEPB registration or recover the duty demand on that basis.

Conclusion: The cancellation of the DEPB registration and the demand of customs duty were set aside in favour of the appellant.

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