2020 (1) TMI 165 - AT - Customs

Appeal Granted: Case Remanded for Conversion of Free Shipping Bills to EPCG; Documents Required in 3 Months.

M/s ISOLLOYD ENGINEERING TECHNOLOGIES LTD Versus COMMISSIONER OF CUSTOMS, EXPORT

M/s ISOLLOYD ENGINEERING TECHNOLOGIES LTD Versus COMMISSIONER OF CUSTOMS, EXPORT - TMI Issues Involved:1. Conversion of free shipping bills to Export Promotion Capital Goods (EPCG) scheme shipping bills.2. Applicability of Section 149 of the Customs Act, 1962.3. Time limit for filing an application for amendment of shipping bills.4. Validity and binding nature of CBEC Circular No. 36/2010-Customs.5. Sufficiency of documentary evidence for conversion.6. Precedent decisions on similar issues.Issue-wise Detailed Analysis:1. Conversion of free shipping bills to EPCG scheme shipping bills:The appellant requested the conversion of fourteen shipping bills from free shipping bills under scheme Code 00 to EPCG under scheme Code 11. The Commissioner of Customs denied this request based on Circular No. 36/2010 dated 23.09.2010, which states that free shipping bills are subject to 'nil' examination norms and should not be converted to EPCG scheme shipping bills.2. Applicability of Section 149 of the Customs Act, 1962:The appellant argued that Section 149 allows for the amendment of any document presented before the Custom House by the importer/exporter, even after the goods have been cleared or exported, provided the amendment is based on documents that were in existence at the time of export. The Commissioner, being the proper officer, has the power to allow such amendments.3. Time limit for filing an application for amendment of shipping bills:The Commissioner denied the request for conversion as it was not made within the prescribed period of three months from the date of the Let Export Order (LEO). The appellant contended that Section 149 does not prescribe any time limit for applying for amendments, and the CBEC cannot impose such a limit through a circular.4. Validity and binding nature of CBEC Circular No. 36/2010-Customs:The appellant argued that circulars issued by the CBEC represent the department's understanding of statutory provisions and are not binding on courts or quasi-judicial authorities. The Supreme Court in Bengal Iron Corporation vs. Commercial Tax Officer held that such circulars are not binding on courts and quasi-judicial authorities.5. Sufficiency of documentary evidence for conversion:The appellant provided various documents, including the EPCG license, installation certificate, and invoices, which were in existence at the time of filing the shipping bills. These documents were intended to prove that the exported goods were produced using the imported machinery under the EPCG scheme.6. Precedent decisions on similar issues:The appellant cited several decisions where it was held that there is no time limit for filing an application for amendment of shipping bills, provided the amendment is based on documents that were in existence at the time of export. The Tribunal in Indian Oil Corporation Limited vs. Commissioner of Customs AIR held that the time limit specified in the CBEC circular cannot be applied to deny the request for conversion of shipping bills.Judgment:The Tribunal considered the rival contentions, the precedent decisions, and the documentary evidence provided by the appellant. It concluded that the impugned order could not be sustained and set it aside. The appeal was allowed by way of remand to the original adjudicating authority for the conversion of free shipping bills to EPCG shipping bills. The appellant was directed to provide all necessary documents to prove their claim for exports made under free shipping bills. This exercise was to be completed within three months from the receipt of the order.