2022 (2) TMI 23 - HC - Customs

Court Orders Extension of MEIS Benefits for Shipping Bills, Emphasizes Rectifying Errors

The Court overturned previous decisions and ordered the extension of MEIS benefits to the petitioner for specified shipping bills, emphasizing the need to ... Merchandise Exports from India Scheme (MEIS) - procedural lapse - inadvertent error - rectification of shipping bill - administrative discretion of Policy Relaxation Committee - technical infeasibility of automated transmission - denial of substantive relief on technicalitiesMerchandise Exports from India Scheme (MEIS) - procedural lapse - inadvertent error - rectification of shipping bill - technical infeasibility of automated transmission - denial of substantive relief on technicalities - Whether the decisions of the Policy Relaxation Committee and its Appellate Committee rejecting MEIS benefit where the exporter inadvertently ticked 'No' instead of 'Yes' in the reward column of shipping bills should be set aside and the MEIS benefit granted. - HELD THAT: - The Court accepted the petitioner's factual assertion that, although the reward column was inadvertently marked 'No', the shipping bill elsewhere contained an unequivocal written declaration of intent to claim MEIS benefits, demonstrating bona fide intention. While the PRC and the Appellate Committee found a procedural lapse and pointed to technical constraints in the automated systems preventing conversion of the entry and transmission from ICEGATE to DGFT, the Court held that such technicalities should not result in denial of substantive relief where the error is bona fide and rectifiable. Relying on consistent decisions of other High Courts recognising that inadvertent selection of 'N' instead of 'Y' is a curable procedural defect when the intention to claim the reward is otherwise manifest, the Court observed that procedures and systems ought to provide a mechanism to rectify such human errors. Applying that principle, the Court set aside the impugned PRC order and its review and directed the respondents to grant MEIS benefits in respect of the 17 shipping bills and to undertake necessary formalities to extend the benefit. [Paras 13, 14, 15]The orders of the PRC dated 28.05.2019 and its review dated 07.01.2020 were set aside and the respondents were directed to grant MEIS benefits in respect of the 17 shipping bills and complete necessary formalities.Final Conclusion: The petition succeeds; the PRC and Appellate Committee decisions rejecting MEIS claims for the 17 shipping bills are quashed and respondents are directed to extend the MEIS benefit and carry out requisite formalities. Issues:1. Quashing of orders dated 28.05.2019 and 07.01.2020.2. Consideration of petitioner's case for export incentives under MEIS.3. Rectification of inadvertent error in shipping bills.4. Denial of benefit under MEIS due to procedural lapse.5. Technical difficulties in the automated system for rectification.6. Comparison with similar judgments by other High Courts.Analysis:1. The petitioner sought to quash the orders dated 28.05.2019 and 07.01.2020, requesting consideration for export incentives under MEIS or rectification of inadvertent errors in the shipping bills. The petitioner highlighted a procedural lapse where 'No' was selected instead of 'Yes' in the rewards column of certain shipping bills by mistake.2. The petitioner argued that despite the error, the intention to claim benefits under the MEIS scheme was evident from the shipping bills. The Policy Relaxation Committee (PRC) and the Appellate Committee rejected the plea based on technical grounds, stating that the automated system did not allow changes from 'No' to 'Yes'.3. The petitioner referenced judgments from other High Courts where relief was granted in similar cases of inadvertent errors in shipping bills. The Orissa High Court's decision emphasized rectifying procedural defects to ensure exporters are not deprived of entitled benefits under the MEIS scheme.4. The Court acknowledged the petitioner's bonafide error and the need for procedural accommodations to rectify such mistakes. Denying relief based on technicalities would amount to a denial of justice. Therefore, the Court set aside the PRC's decision and directed the respondent to grant MEIS benefits to the petitioner for the 17 shipping bills in question.5. The judgment highlighted the importance of rectifying genuine mistakes and ensuring that procedural systems accommodate such errors to prevent unjust denial of entitled benefits. The Court's decision aimed to uphold fairness and justice in the administration of export incentive schemes.6. In conclusion, the Court disposed of the petition by overturning the previous decisions and ordering the extension of MEIS benefits to the petitioner for the specified shipping bills, emphasizing the need for rectifying bonafide errors to prevent unjust denial of legitimate benefits.