Customs must allow Bill of Entry amendments for IGST payments under Advanced Authorisation and EOU schemes

The Kerala HC allowed writ petitions challenging refusal to amend Bills of Entry for imported goods under Advanced Authorisation and EOU schemes. Petitioners sought amendments to reflect IGST payments made post-clearance for export refund claims. The court noted CBIC Circular No.16/2023 provided procedures for such amendments despite Section 149's second proviso. Respondents' contention that Bills of Entry cannot be amended without IGST payment at clearance was rejected, as petitioners had paid IGST and interest. The court found discriminatory treatment where some entities were allowed amendments while others were denied. HC directed respondents to amend petitioners' Bills of Entry, with one petitioner required to pay pending interest within 15 days.

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Issues Involved:
1. Amendment of Bill of Entry u/s 149 of the Customs Act, 1962.
2. Payment of IGST and its implications on refunds under the CGST/IGST Act and Rules.
3. Applicability of Circular No.16/2023 and related judgments.
4. Discretionary power of the customs authority to amend documents post-clearance.

Summary:

Issue 1: Amendment of Bill of Entry u/s 149 of the Customs Act, 1962
WPC No.5394 of 2024
The petitioner, engaged in manufacturing and exporting coir products, sought amendment of the Bill of Entry after paying IGST and interest. The 4th respondent declined the request, citing that amendments post-clearance are not permissible except based on pre-existing documentary evidence. The petitioner argued that the Supreme Court in ITC Ltd. v. Commissioner of Central Excise, Kolkata [2019 KHC 6932] allowed such amendments under Section 149.

WPC No.4670 of 2024
The petitioner, a 100% Export Oriented Private Limited Company, faced similar issues. Despite paying IGST through TR6/Manual challans, their request for amending Bills of Entry was denied. The petitioner cited the Telangana High Court's judgment in Sony India Pvt. Ltd. v. Union of India, which supports amendments under Section 149.

WPC No.12195 of 2024
The petitioner, importing cement, sought amendment of the Bill of Entry to correct IGST calculation based on CIF value. The request was rejected despite payment of differential IGST and interest.

WPC No. 6090 of 2024
The petitioner, engaged in manufacturing and export, paid IGST and interest but was denied amendment of Bills of Entry. The petitioner argued that Section 149 allows amendments based on pre-existing documentary evidence.

Issue 2: Payment of IGST and its Implications on Refunds
WPC No.5394 of 2024
The petitioner paid IGST and interest post-clearance and sought amendment to regularize IGST refunds on exports. The 4th respondent denied the amendment, leading to a show cause notice demanding recovery of ineligible IGST refunds.

WPC No.4670 of 2024
The petitioner faced a similar situation where IGST was paid through manual challans, but the system did not auto-populate this in GSTR-2A/2B, leading to a mismatch and subsequent show cause notice demanding recovery of IGST refunds.

WPC No. 6090 of 2024
The petitioner paid IGST and interest and sought amendment to regularize IGST refunds. The 2nd respondent issued a show cause notice demanding recovery of ineligible IGST refunds.

Issue 3: Applicability of Circular No.16/2023 and Related Judgments
The petitioners cited Circular No.16/2023, which provides procedures for amending Bills of Entry where IGST was levied in violation of import conditions. The Telangana High Court's judgment in Sony India Pvt. Ltd. v. Union of India and the Bombay High Court's judgment in Dimension Data India Pvt. Ltd. v. Commissioner of Customs supported the petitioners' claims for amendments under Section 149.

Issue 4: Discretionary Power of Customs Authority
The respondents argued that amendments post-clearance are not permissible under Section 149, except based on pre-existing documentary evidence. The petitioners countered that the customs authority has discretionary power to amend documents under Section 149 and Section 154, supported by judgments from the Telangana and Bombay High Courts.

Conclusion:
The court allowed the petitions, directing the respondents to amend the Bills of Entry. The petitioner in WPC No.4670 of 2024 was instructed to pay the interest within 15 days, following which the Bills of Entry should be amended. The court emphasized that the customs authority has the discretionary power to amend documents post-clearance under Section 149, supported by relevant judgments and Circular No.16/2023.

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