2024 (5) TMI 1352 - HC - Customs

Export incentive claims under Focus Product Scheme and Merchandise Export from India Scheme allowed after rejection order quashed

The Madras HC quashed the rejection order dated 18.02.2021 concerning export incentive claims under the Focus Product Scheme and Merchandise Export from ... Export Incentives - Rejection of Export Incentive Scheme, under Focus Product Scheme ('the FPS Scheme') and new export incentive scheme called Merchandise Export from India Scheme ('the MEIS Scheme') - rewards to exporters to offset infrastructural insufficiencies and associated costs - HELD THAT:- Following the decisions in the case of Horizon Aerospace (India) Pvt Ltd. -vs- Union of India [2023 (2) TMI 1101 - DELHI HIGH COURT] Jindal Drugs [2021 (7) TMI 1034 - MADRAS HIGH COURT] and M/s Ashwini Ashish Dighe [2019 (8) TMI 1006 - BOMBAY HIGH COURT] the impugned order dated 18.02.2021 passed by the second respondent is hereby quashed. The third respondent is directed to allow the claim made by the petitioner under the FPS and MEIS Scheme and pass appropriate orders within a period of four weeks from the date of receipt of a copy of this order. In the result, this Writ Petition is allowed. Issues:Challenge to rejection of export incentive scheme claim under FPS and MEIS Scheme.Analysis:The petitioner, a company engaged in manufacturing and selling power supply systems, challenged the rejection of its incentive claims under the Focus Product Scheme (FPS) and Merchandise Export from India Scheme (MEIS). The petitioner had indigenized systems previously imported by defense organizations and applied for incentives for exports to Israel. The petitioner shipped batches of supplies to Israel and applied for FPS and MEIS incentives, but the claims were rejected. The petitioner filed a review before the Policy Relaxation Committee, which also rejected the claim. The respondents argued that the petitioner should have exhausted the review process before approaching the court. However, the court noted similar cases where rejection of claims was set aside, emphasizing the importance of eligibility criteria under the schemes.The court referred to previous judgments, including one by the High Court of Bombay, where communication rejecting claims was set aside for re-examination by the Director General of Foreign Trade. The court highlighted the need for a fresh representation and proper consideration of the petitioner's claim under the FTP. Another judgment by the High Court of Delhi emphasized the correct application of exclusionary clauses and the obligation to follow binding judgments. The court quashed the impugned order and directed the third respondent to allow the petitioner's claim under the FPS and MEIS Scheme within four weeks.In conclusion, the court allowed the Writ Petition, setting aside the rejection of the petitioner's export incentive claims under FPS and MEIS Schemes. The court directed the third respondent to process the petitioner's claim within a specified timeframe, following the principles established in previous judgments. No costs were awarded in the matter.