Court directs conversion of shipping bills to MEIS; respondents' rejection unjustified. Petition allowed, letter quashed.

The court concluded that the respondents were not justified in rejecting the petitioner's request for conversion of shipping bills from free to MEIS shipping bills. The court allowed the petition, quashed the impugned letter dated 11.02.2019, and directed the respondents to permit the conversion of the shipping bills subject to the satisfaction of the competent authority within two months. The rule was made absolute with no order as to costs.

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Issues Involved:

1. Eligibility for benefits under the Merchandise Exports From India Scheme (MEIS).
2. Amendment of shipping bills to include 'Declaration of Intent'.
3. Time limit for applying for conversion of shipping bills.
4. Discrimination between EDI and Non-EDI shipping bills.
5. Procedural requirements under section 149 of the Customs Act, 1962.

Issue-wise Detailed Analysis:

1. Eligibility for benefits under the Merchandise Exports From India Scheme (MEIS):
The petitioner, a partnership firm located in Kandla Special Economic Zone (KSEZ), engaged in manufacturing derivatives of Castor Oils, sought benefits under the MEIS for exports made between April 2015 to January 2016. The MEIS, introduced by the Foreign Trade Policy (FTP) 2015-2020, aims to promote exports of notified goods manufactured in India. The petitioner had previously been granted MEIS benefits but faced rejection for twenty-five shipping bills due to the absence of a 'Declaration of Intent'.

2. Amendment of shipping bills to include 'Declaration of Intent':
The petitioner applied for amendment of shipping bills to include the 'Declaration of Intent' to claim MEIS benefits. Despite continuous follow-ups and representations, the petitioner faced delays and eventual rejection on technical grounds. The court noted that the 'Declaration of Intent' is procedural and not mandatory for Non-EDI shipping bills, unlike EDI shipping bills where it is mandatory.

3. Time limit for applying for conversion of shipping bills:
The petitioner's request for conversion of shipping bills was rejected based on Circular No.36/2010-Customs, which mandates that such requests must be made within three months from the date of the Let Export Order (LEO). The court observed that the delay was due to the respondents' prolonged inter-departmental communications and not the petitioner's fault.

4. Discrimination between EDI and Non-EDI shipping bills:
The petitioner argued that the respondents discriminated between EDI and Non-EDI shipping bills by allowing corrections for EDI shipping bills but not for Non-EDI shipping bills. The court found this differentiation unjustified, especially since the petitioner’s goods were eligible for MEIS benefits and had been regularly claiming them for later periods.

5. Procedural requirements under section 149 of the Customs Act, 1962:
Section 149 allows amendments to documents presented in the customs house at the discretion of the proper officer. The court highlighted that the petitioner had submitted all necessary documents and the goods conformed to the description in the shipping documents. The court relied on the Delhi High Court's decision in Kedia (Agencies) Pvt. Ltd. v. Commissioner of Customs, which permitted amendments to shipping bills when all other relevant materials were present.

Conclusion:
The court concluded that the respondents were not justified in rejecting the petitioner's request for conversion of shipping bills from free to MEIS shipping bills. The court allowed the petition, quashed the impugned letter dated 11.02.2019, and directed the respondents to permit the conversion of the shipping bills subject to the satisfaction of the competent authority within two months. The rule was made absolute with no order as to costs.

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