DEPB verification and deemed acceptance of export value prevent belated customs enquiry after export completion

The DEPB verification process was constrained by the departmental circulars, which treated the declared FOB or present market value as accepted if no show-cause notice was issued within 30 days of export. Once the exporter produced shipping bills, bank certificates and related records evidencing export, realisation and licence issuance, Customs could not rely on an open-ended power to reopen the declared value or keep the licences under further enquiry. The circulars were binding on field officers, so the deeming acceptance of value had to be given effect. The practical result was that the DEPB licences were required to be verified and the credit made available without further delay.

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Issues: Whether the Customs authorities could withhold verification of the DEPB licences and initiate further enquiry into the declared FOB value after the period stipulated in the departmental circulars, notwithstanding that the exports had already been completed and the licences issued.

Analysis: The DEPB scheme required verification of export particulars, but Circular No. 69/97 provided that where no show cause notice challenging the declared present market value was issued within 30 days from the date of export, the declared value would be deemed to have been accepted. The exporter produced shipping bills, bank certificates and other records showing export, realisation and issuance of the licences. In the absence of timely action by the department, the authorities could not disregard the deeming provision or claim an open-ended right to conduct further enquiry. The departmental circulars were binding on the field officers, and the declared value had to be treated as accepted.

Conclusion: The petitioner was entitled to have the DEPB licences verified and to use the credit granted thereunder without further delay, and the Customs authorities were not justified in continuing the enquiry.

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