TaxTMI 
TaxTMI 
2021 (11) TMI 518
X X X X Extracts X X X X
X X X X Extracts X X X X
....s issued proposing to reject the request for conversion of Shipping Bills on the ground that the request for conversion / amendment of Shipping Bills pertaining to exports made during the period 2000 to 2014 is barred by limitation as provided in CBEC Circular No. 36/2010-Cus. dated 23.9.2010. After due process of law, the original authority vide order impugned herein, rejected the request on the grounds; that the reason put forth by the appellant for omission to file drawback shipping bill at the time of exports is not satisfactory, the request is barred by limitation as per Board Circular and that the documents which were in existence at the time of exports are not available. 3. The learned counsel Ms. A. Aruna appeared and argued for the appellant. The grounds put forward in the appeal as well as the submissions made at the time of arguments are summarized as under:- (a) The discussion given in the impugned order for arriving at the aforesaid grounds of rejection are as below:- (i) The appellant requested for conversion of unspecified number of shipping bills for the years from 2000 to 2011. (ii) The appellant has not furnished the shipping bills co....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ll the copies of the shipping bills to the office of the respondent. (d) The appellant had also submitted sample copies of ARE1 and would have submitted the remaining ARE-1 if the respondent office had directed the appellant to produce them. In the SCN or during the personal hearing, the appellant was not put to notice that the documents produced are insufficient to consider the request for amendment. Had the appellant been informed at any point of time, before passing the impugned order, they could have furnished the documents once again. Rule 12(1)(a) of Customs, Central Excise Duties and Service Tax Drawback Rules, 1995, reads as under:- "Statement/ Declaration to be made on exports other than by Post - (1) In the case of exports other than by post, the exporters shall at the time of export of the goods - (a) state on the shipping bill or bill of export, the description, quantity and such other particulars as are necessary for deciding whether the goods are entitled to drawback, and if so, at what rate or rates and make a declaration on the relevant shipping bill or bill of export that - (i) a claim for drawback under these rules is b....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... settled law that substantial benefit cannot be denied for non-observation of procedure, that too when the assessee is otherwise eligible for the benefit and has fulfilled all other conditions. In the subject case, the appellant had paid duty on the inputs. They used duty suffered inputs and raw materials in the manufacture of export goods and the goods were subjected to examination and scrutiny of jurisdictional Central Excise authority as established by the document in the nature of ARE1s. (i) The appellant had requested to amend the shipping bills under section 149 of the Customs Act, 1962. The said provision of law allows amendment of any customs document, even after clearance of goods from customs, and the only condition provided therein is that the documentary evidence, based on which amendment sought, should have been in existence at the time of export / import. Further, proviso to Rule 12(1) of Drawback Rules, 1995 also allows conversion of Free Shipping Bills and no time limit is prescribed in this Rule also. (j) The shipping bills indicate the description, quantity, value and other particulars of the goods exported. The goods were allowed for export afte....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sdiction vested in the quasi-judicial authorities'. Similar view was taken in the case of Nucleus Satellite Communications Pvt. Ltd. Vs. CC - 2007 (216) ELT 67 (Tri. Chen.), wherein it was held that 'the circular of the Board No.4/2004 does not mention any statutory bar for denying the conversion claimed by the exporters. By denying export incentives granted by the Government through various schemes, the objective to promote exports will be defeated''. She prayed that the appeal may be allowed. 7. The learned AR Shri S. Balakumar appeared for the department. He supported the findings in the impugned order. It is argued by him that the period involved is from 2000 to December 2014. There is much delay in filing the request for conversion of the free shipping bill into duty drawback shipping bill. The appellant vide letter dated 9.10.2015 furnished details of FOB value as Rs. 77,41,61,176.40 and drawback amount of Rs. 1,40,90,563.85 for the period from January 2012 to December 2014 and furnished list of Shipping Bills for the corresponding period from January 2012 to December 2014. Thereafter, the appellant vide letter dated 25.1.2016 furnished revised FOB value as Rs. 4,30,20,....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lls (shipping bills not filed under any export promotion scheme) are subject to 'nil' examination norms. Conversion of free shipping bills into EP scheme shipping bills (advance authorization, DFIA, DEPB, reward schemes etc.) should not be allowed. However, the Commissioner may allow All Industry Rate of duty drawback on goods exported under free shipping bill, without conversion of such free shipping bill to Drawback Scheme shipping bill, in terms of the proviso to rule 12(1) (a) of the Customs, Central Excise and Service Tax Drawback Rules, 1995." 9. That as per Rule 12(1)(a) of the Drawback Rules, 1995 declaration has to be made at the time of exports, as to whether goods are eligible for drawback. Such declaration has not been made by appellant and the Shipping Bills were filed as Free Shipping Bills. The reason put forward by the appellant for failure to file declaration is not befitting and not beyond control. Rule 12(1)of Drawback Rules,1995 reads as under:- "Statement/ Declaration to be made on exports other than by Post - (1) In the case of exports other than by post, the exporters shall at the time of export of the goods - (a) stat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....y rejected the request for conversion of the Shipping Bills. 11. Heard both sides. 12. The issue is whether the rejection of request for amendment / conversion of free shipping bills to duty drawback shipping bills is legal and proper. 13. The appellant has made request for conversion of the shipping bills vide two letters as mentioned above. In the letter dated 25.1.2016, it is explained by them that drawback has been inadvertently not claimed by them while filing the shipping bills. In para 3 of the reply to the Show Cause Notice the reason for omitting to claim drawback by filing drawback shipping bills is explained by the appellant as under:- "The noticee have been exporting goods from 1998 onwards. During 2014 - 15, they faced difficulties in competing in the international market due to escalation in cost of production and competition. In order to reduce the cost of production, so as to complete in the international market, they hired auditors to conduct audit for the said purpose. From such audit only they came to know that they have been exporting taxes also in addition to exporting the goods which otherwise, could have been got back as duty drawback. As pe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....,328.00 12. January 2012 to March 2012 37,595,276.88 7,51,906.00 13. April 2012 to June 2012 4,68,16,310.85 9,36,320.00 14. July 2012 to September 2012 3,16,22,695.08 6,32,451.00 15. October 2012 to December 2012 4,09,40,845.31 8,18,817.00 16. January 2013 to March 2013 6,76,08,335.91 13,52,166.00 17. April 2013 to June 2013 6,39,40,642.06 12,78,819.00 18. July 2013 to September 2013 9,08,81,484.78 17,56,341.00 19. October 2013 to December 2013 8,80,73,595.68 15,00,140.00 20. January 2014 to March 2014 7,45,32,856.45 10,75,200.85 21. April 2014 to June 2014 8,52,79,400.78 14,51,424.00 22. July 2014 to September 2014 9,39,08,202.03 15,96,443.00 23. October 2014 to December 2014 5,29,61,530.50 9,40,536.00 4,302,050,859.59 81,120,455.25 16. It is stated in these letters that they have produced the necessary documents in the nature of Shipping Bill, ARE-I, BRC etc. In the impugned order one of the reasons for rejecting the request is that the documents at the time of exports are not available. However, there is no s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....st for conversion of free shipping bills to drawback shipping bills. The request for conversion/amendment of shipping bill is made under section 149 of the Customs Act, 1962. This section does not prescribe any time limit for filing an application for amendment of shipping bill. The said section reads as under:- "149. Amendment of documents.-Save as otherwise provided in sections 30 and 41, the proper officer may, in his discretion, authorise any document, after it has been presented in the customs house to be amended: Provided that no amendment of a bill of entry or shipping bill or bill of export shall be so authorised to be amended after the imported goods have been cleared for home consumption or deposited in a warehouse, or the export goods have been exported, except on the basis of documentary evidence which was in existence at the time the goods were cleared, deposited or exported, as the case may be". 21. It can be seen that law allows amendment of the shipping bill even after the goods have been exported. The only requirement, as already discussed, is that the exporter has to produce documentary evidence which was in existence at the time when goods we....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d the interpretation of the phrase 'in existence', as according to the revenue the phrase should be read as available with the Department and it is only if the documents relied upon by the petitioner seeking amendment were, in fact, 'on record' that such amendment could even be considered. 13. I cannot agree. What is contemplated vide the proviso to Section 149 is an opportunity to be extended to an assessee to produce such documents that were 'in existence' at the stipulated time that would serve to establish the error, if any, in the B/E. The genuineness of such documents or a confirmation as to whether such documents were actually 'in existence' is certainly to be left open for thorough examination by the customs authorities and the Court would have no say in such a factual matter. Suffice it to say that the Department should take note of the documents that are presented by an assessee as being 'in existence' at the relevant time to evidence an error sought to be amended. 14. In the light of the discussion as aforesaid, the rejection of the request for amendment by the respondent is set aside to be re-done de novo. This writ petition is allowed." 24. The Hon....
X X X X Extracts X X X X
X X X X Extracts X X X X
....inadvertent typo error at the time of filing the Bill of Entry by incorrectly declaring the CTH as 85176990 instead of correct CTH 85176930. For the goods under CTH 85176930, the rate of duty is NIL whereas in respect of goods under other heading, the rate of duty is 20%. The error resulted in payment of excess duty to the tune of Rs. 14,50,01,413/-. Immediately, on detecting the error, a letter dated 7.6.2019 was submitted requesting to correct the bill of entry. The request was declined. The Hon'ble High Court referred to various decisions including the decisions in Hewlett Packard Enterprises (supra) and Usha International Ltd. Vs. Assistant Commissioner - 2019 (365) ELT 56 (Mad.). The relevant paras read as under:- "17. The Learned Counsel for the petitioners submits that the mistake in adopting the correct classification for the purpose of assessment can be rectified under Section 149 read with Section 154 of the Customs Act, 1962. Section 149 of the Customs Act, 1962 a proper officer in his discretion may authorise any document to be presented. Section 149 of the Customs Act, 1962 reads as under :- "Amendment to Documents. - Save as otherwise provided in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to reasons beyond the control of exporter. The Rules also does not limit the time. We have to hold that the request for conversion of Free Shipping Bill cannot be denied as time-barred by resorting to the Board Circular. 28. Be that as it may, before concluding, we are not able to overlook a serious question presented by the peculiar facts of the case before us. In the absence of any period of limitation prescribed in the section, whether it would mean that the remedy / relief can be sought for at any time when the Importer / Exporter wake up to realize the mistake or omission. In our opinion, the remedy has to be sought for within a reasonable time. A legal claim cannot be enforced if there is a long delay in asserting the right or the claim. 29. The duty drawback or drawback is a fundamental principle of international trade law and policy under which the duties, taxes and fees paid on imported inputs which are used for manufacture of goods and then exported are refunded. This is allowed in the nature of export promotion scheme and the intention is to eliminate the recovery of such costs (duty, taxes and fees) on the export goods in the international market. Chapter X of The....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ough section 149 of Customs Act, 1962 and Drawback Rules, 1995 do not specify any time limit, the huge and humongous delay does concern us. Under section 75A there is liability to pay interest on delayed payment of drawback. Conversely, it has to be construed that a claim of drawback has to be filed within reasonable time. The Limitation Act, 1963 bars unduly long time for pursuit of a legal remedy. Neither do courts encourage enforcing stale demands. 34. Section 27 of the Customs Act, 1962 deals with claim for refund of duty. The refund claim under this section has to be filed within one year from the date of payment of duty. Section 28 deals with recovery of duty which is not paid or short-paid. While raising a demand for recovery of such duty the period is limited to two years. Prior to 14.5.2016, this period was one year. In case of fraud, collusion or suppression of facts, the said period for which the duty can be demanded and recovered is extended to five years. When the time limit is specifically prescribed, the same would apply and one need not take recourse to the Limitation Act. 35. In the absence of any period of limitation prescribed, it is generally understood th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he department for stay of the operations of the order of the Ld. Lower Authority has to be dismissed. Inasmuch as it is a covered matter by our decisions referred to supra the appeals themselves are also taken up for disposal with the consent of the both sides. The only plea of the Revenue is that in the absence of any period of limitation provided under Section 61(3), the general period, of limitation prescribed under the Limitation Act should be made applicable. We are unable to accept this plea of the Ld. D.R. in view of the judgment of the Hon'ble Supreme Court in the case of G.O.I. v. Citedal Fine Pharmaceuticals (supra). The Hon'ble Supreme Court in para 6 has held is reproduced below : "Ld. Counsel appearing for the respondents urged that Rule 12 is unreasonable and violative of Article 14 of the Constitution, as it does not provide for any period of limitation for the recovery of duty. He urged that in the absence of any prescribed period for recovery of the duty as contemplated by Rule 12, the officer may act arbitrarily in recovering the amount after lapse of long period of time. We find no substance in the submission. While it is true that Rule 12, does not pres....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... be paid till the date of clearance in terms of Rule 61(3) of the Customs Act, 1962. The department recovered at the time of clearance the duty as well as interest as held payable at that time and cancelled the bonds. Taking into consideration the relevant date the demand have been clearly raised much after the period of six months. The Appeals of the Revenue are therefore dismissed." 37. The Tribunal refused to accept the plea of Revenue that the limitation period of three years for recovery of money as per Limitation Act, 1963 should apply. The said decision of the Tribunal was upheld by the Hon'ble Supreme Court as reported in 2000 (119) ELT A177 (SC). The principle enunciated in these judgments is that when no limitation period is prescribed under the Act, the proceedings for recovery have to be initiated within a reasonable time. 38. Again, section 128 of the Customs Act, 1962 provides for filing of appeals before Commissioner (Appeals). This section bars the Commissioner (Appeals) from condoning the delay beyond the period of 30 days. The question as to whether delay beyond six months can be condoned by resorting to section 5 of the Limitation Act, 1963 was discusse....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Limitation Act means an exclusion by express words, i.e. by express reference and not exclusion as a result of logical process of reasoning. In the instant case, there is no question of implied exclusion but, it specifically provides a different period of limitation, as also the period during which, if delay has occurred, it could be condoned." 39. The Hon'ble High Court held that when the Act provides for different period of limitation, the applicability of section 5 of the Limitation Act is specifically excluded. 40. Reverting to the case on hand, although no limitation has been prescribed in section 149, an assessee cannot be permitted to take undue advantage. The remedy of amendment under section 149 should be sought within a reasonable time. We have already expressed our view that there is inordinate delay in filing the application for amendment under section 149 of the Customs Act, 1962. We then have to consider what would be the reasonable period for entertaining an application under section 149 of the Customs. 41. The Customs Act, 1962 being a special law and a complete code in itself it would not be proper to pull in the limitation period under the Limitation....