2004 (12) TMI 206 - AT - Customs

Appeal granted for correction of Shipping Bills to include DEPB credit eligibility.

The Tribunal allowed the appeal, directing the correction of Shipping Bills from 'Zero duty EPCG' to 'EPCG and DEPB (post export)'. The appellants were ... Conversion of shipping bills from one export promotion scheme to another - amendment of shipping bill to reflect true nature of export (correction of clerical/procedural lapse) - conditions for permitting conversion under DOR Circular No. 4/2004-Cus. para 3.2 - DEPB entitlement and condonation under Exim Policy paras 4.47 and 9.3 - appealability of administrative/quasijudicial decision under Section 129A(1)(a) of the Customs ActAmendment of shipping bill to reflect true nature of export (correction of clerical/procedural lapse) - DEPB entitlement and condonation under Exim Policy paras 4.47 and 9.3 - Validity of the Commissioner's refusal to permit amendment of EP scheme entry in the shipping bills to include DEPB so as to enable claim of DEPB credit. - HELD THAT: - The Tribunal found on the materials (shipping bills together with ARE-1s and the CHA's admission) that the exports were in substance under the combined 'EPCG and DEPB (post export)' scheme and that omission of 'DEPB' in the shipping bills was a genuine procedural lapse by the CHA. The Tribunal observed that the ARE-1s expressly declared 'Export under DEPB' and the Customs certification in Part B corroborated shipment under that scheme, indicating the exporter had instructed filing under EPCGDEPB. The Tribunal also noted the time limits for applying for DEPB credit under para 4.47 and the condonable extension with late cut under para 9.3 of the Exim Policy, and that amendment of the EP copy of the shipping bills was a precondition for JDGFT to grant credit. Applying these facts, the Tribunal held the Commissioner's refusal to allow the amendment was not justified and directed substitution of 'EPCG and DEPB (post export)' for 'Zero duty EPCG' in the subject shipping bills so that the exporter may apply to the JDGFT for DEPB credit within the prescribed/extended period. [Paras 4, 5, 6, 7]Impugned refusal set aside; shipping bills to be amended to read 'EPCG and DEPB (post export)' and exporter permitted to apply to JDGFT for DEPB credit within the period available under Exim Policy.Conditions for permitting conversion under DOR Circular No. 4/2004-Cus. para 3.2 - Whether the appellants satisfied the conditions in para 3.2 of DOR Circular No. 4/2004-Cus. so as to permit conversion/amendment. - HELD THAT: - The Tribunal examined para 3.2 which sets out conditions (a)-(e) for permitting conversion of shipping bills. The Commissioner recorded that conditions were not fulfilled but did not state the basis for that finding. The appellants' case that the request was made within the period prescribed by condition (a) and that conditions (b)-(e) were met was not rebutted by the Revenue. On the available export documents (ARE1s, shipping bills, CHA admission) and on the unchallenged factual case advanced, the Tribunal concluded the appellants had satisfied the conditions of para 3.2 and were therefore entitled to conversion/amendment of the EP scheme entry. [Paras 6]Appellants found to have fulfilled the conditions in para 3.2 of the Circular; conversion/amendment permitted.Appealability of administrative/quasijudicial decision under Section 129A(1)(a) of the Customs Act - Whether the Commissioner's marginally recorded refusal/decision was an appealable order. - HELD THAT: - The Tribunal held that the Commissioner's handwritten conclusions on the party's letter, given after hearing the party and resulting in denial of DEPB benefit, amounted to a decision discharging a quasijudicial function and therefore were appealable under Section 129A(1)(a) of the Customs Act. The Tribunal observed the chronology from the party's initial request to the Commissioner's written notations and concluded the impugned decision was capable of appellate scrutiny. [Paras 6]The Commissioner's decision is appealable under Section 129A(1)(a); the Tribunal entertained and adjudicated the appeal.Final Conclusion: The appeal is allowed; the Commissioner's refusal to permit amendment of the shipping bills is set aside, the EP scheme entry in the specified shipping bills is to be changed to 'EPCG and DEPB (post export)', and the appellants may apply to the JDGFT for DEPB credit within the period available under the Exim Policy; the Commissioner's marginal decision was held to be appealable. Issues Involved:1. Mistake in filing Shipping Bills under the wrong export promotion scheme.2. Rejection of DEPB credit application by JDGFT due to the omission of 'DEPB' in Shipping Bills.3. Request for correction of the Shipping Bills from 'EPCG' to 'EPCG and DEPB'.4. Applicability of Policy Circular No. 7/2002 and Circular No. 4/2004-Cus.5. Commissioner's rejection of the request for correction and subsequent appeal.Issue-wise Detailed Analysis:1. Mistake in Filing Shipping Bills:The appellants filed Shipping Bills under the Zero duty EPCG Scheme instead of the required EPCG and DEPB (post-exports) scheme. This mistake was made by their CHA, who admitted the error. The appellants realized the mistake upon receiving the export promotion (EP) copies and returned the documents for correction.2. Rejection of DEPB Credit Application:The Joint Director General of Foreign Trade (JDGFT) rejected the appellants' DEPB credit application because the EP copies of the Shipping Bills did not mention 'DEPB'. This procedural lapse led to the denial of DEPB benefits to the appellants.3. Request for Correction of Shipping Bills:On 13-2-2004, the appellants requested the Commissioner of Customs (Export) to condone the mistake and allow correction of the Shipping Bills from 'EPCG' to 'EPCG and DEPB'. The Customs House requested certain documents, which the appellants provided. However, the Assistant Commissioner of Customs informed the appellants that their request for conversion had not been considered by the appropriate authority. The appellants reiterated their request, citing Policy Circular No. 7/2002 and Circular No. 4/2004-Cus.4. Applicability of Policy Circular No. 7/2002 and Circular No. 4/2004-Cus:The appellants argued that the non-mention of the correct scheme was a procedural lapse that could be condoned under Policy Circular No. 7/2002. They also contended that conversion of Shipping Bills from one export promotion scheme to another was permissible under Circular No. 4/2004-Cus. The Commissioner, however, rejected their request, stating that the conditions for conversion under the Circular were not fulfilled.5. Commissioner's Rejection and Subsequent Appeal:The Commissioner rejected the appellants' request for conversion, noting that there was no proof that Customs or JDGFT had denied the benefit. The appellants appealed against this decision, arguing that their case fell within the ambit of Circular No. 4/2004-Cus. They claimed that the mistake was genuine and that they had fulfilled all conditions for conversion. The Tribunal found that the appellants' request was for a simple amendment of the Shipping Bills to reflect the real nature of export, not a conversion of the nature of exports. The Tribunal held that the appellants had fulfilled all conditions for conversion and allowed the appeal, directing that 'EPCG and DEPB (post export)' be substituted for 'Zero duty EPCG' in the Shipping Bills. The Tribunal also ordered urgent issuance of the order to allow the appellants to apply for DEPB credit within the extended period prescribed in the Exim Policy 2002-2007.