Conversion of Shipping Bills to drawback cannot be refused on an invalid time limit when the procedure prescribes none.

Rejection of conversion of Shipping Bills from DFIA to Drawback on the basis of an alleged three-month limit from the let export order was unsustainable because the only relied-on circular provision had already been held ultra vires Articles 14 and 19(1)(g) and Section 149 of the Customs Act. The applicable procedural framework also did not prescribe any such time limit for conversion to drawback shipping bills. As the applications were filed after DFIA cancellation and pursued promptly, no delay could be attributed to the assessee, and conversion was therefore permissible.

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Issues: Whether rejection of the request for conversion of Shipping Bills from DFIA to Drawback on the ground of expiry of three months from the date of let export order was sustainable.

Analysis: The rejection rested solely on Para 3(a) of the CBIC Circular No. 36/2010-Customs, which had already been held to be ultra vires Articles 14 and 19(1)(g) of the Constitution of India and Section 149 of the Customs Act, 1962. The earlier decision in the same assessee's case had also held that Para 4.28(e) of the Handbook of Procedures did not prescribe any three-month time limit for seeking conversion to drawback shipping bills. The applications were made after cancellation of the DFIA licences and were followed promptly, so no delay could be attributed to the assessee.

Conclusion: The rejection was unsustainable in law and the assessee was entitled to conversion of the Shipping Bills to Drawback Shipping Bills.

Ratio Decidendi: Where the only basis for refusing conversion of export shipping bills is a circular provision already declared ultra vires, and the applicable procedural framework itself does not prescribe the asserted time limit, the request for conversion cannot be rejected on limitation.

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