2022 (9) TMI 1583 - AT - Customs

Application for conversion of shipping bills - time limitation prescribed in the circular no. 36/2010-Cus - Obligation under the advance authorisation scheme - seeking coverage under schemes of the Foreign Trade Policy - conversion of shipping bills fall into five broad categories from free to drawback free to scheme scheme to drawback . drawback to scheme and scheme to scheme - HELD THAT - According to the appellant the intent of the impugned exports as being in discharge of obligation under the advance authorisation scheme of the Foreign Trade Policy is evident from the shipping bills and it is merely the title of the said bills that is stated to require alteration for enabling the appellant herein to remedy the defect pointed out by the licensing authority under the Foreign Trade Policy. Any further processing of their claim before the licensing authority arises under the Foreign Trade (Development Regulation) Act 1992 which even if envisaging clearance from customs authorities for a decision on the closure of the said authorizations is yet an event of the future with no relevance on the request made before the competent authority u/s 149 of Customs Act 1962 and should not have been a criterion for deciding upon the said request. In view of the settled position elaborated in Haldiram Foods International Pvt Ltd. 2020 (12) TMI 1229 - CESTAT MUMBAI on the irrelevance of the deadline stipulated in the circular of Central Board of Excise Customs (CBEC) relied upon in the impugned order we set aside the rejection of the applications for amendment and direct the original authority to decide the matter afresh within the framework of section 149 of Customs Act 1962 on the propriety of the changes sought for in the shipping bills. Appeal is accordingly disposed off.

Issues Involved:
1. Request for re-designation of shipping bills under the 'advance authorisation' scheme.
2. Denial of the request based on Circular No. 36/2010-Customs.
3. Limitation period for filing amendment requests under Section 149 of the Customs Act, 1962.
4. Justification and reasonableness of the time elapsed before seeking amendment.
5. Examination norms and the impact of amendments on the Foreign Trade Policy schemes.
6. Jurisdiction and discretion of the 'proper officer' under Section 149 of the Customs Act, 1962.
7. Relevance and applicability of judicial precedents and circulars in deciding the matter.

Detailed Analysis:

1. Request for Re-designation of Shipping Bills:
The appellant, M/s Seco Tools India (P) Ltd, sought the re-designation of 275 shipping bills filed between 22nd September 2009 and 30th August 2011 under the 'advance authorisation' scheme. The request was made under Section 149 of the Customs Act, 1962, to correct the categorization from 'free shipping bills' to those fulfilling obligations under specific licence numbers.

2. Denial Based on Circular No. 36/2010-Customs:
The request was denied for not adhering to Circular No. 36/2010-Customs dated 23rd September 2010, which restricted conversions to certain classes of bills and required requests to be made within three months from the date of the 'let export order (LEO)'.

3. Limitation Period Under Section 149 of the Customs Act, 1962:
The appellant argued that the limitation prescribed in the circular exceeded the authority of law, as Section 149 does not contemplate such a restriction. The Tribunal noted that Section 149 does not prescribe any time limit for filing an application for amendment of documents, and judicial precedents have held that requests for conversion cannot be denied as time-barred by resorting to the Board Circular.

4. Justification and Reasonableness of Time Elapsed:
The Tribunal emphasized that the reasonableness of the time elapsed should be considered, and the denial based solely on the circular's time limit was not justified. The appellant's delay was attributed to the licensing authority's caution, and the supporting documents clearly showed that the exports were made under the 'advance authorisation' scheme.

5. Examination Norms and Impact on Foreign Trade Policy Schemes:
The Tribunal discussed that 'free shipping bills' are not burdened by norms of examination, whereas other categories are. The impugned order did not deny the request for conversion from 'free' to 'drawback', which is an 'in-house' disposal. The Tribunal noted that the oversight of consignment-wise transactions is supplemented by the authentication of instrument-wise aggregation of shipments, which should not affect the decision arising from Section 149.

6. Jurisdiction and Discretion of the 'Proper Officer':
The Tribunal highlighted that amendments under Section 149 can be authorized by the 'proper officer' based on documentary evidence existing at the time of clearance/exportation. The denial should be based on specific amendments requested by the importer/exporter, and not on other findings. The Tribunal found that the adjudicating authority exceeded its framework by focusing on the consequence of the amendment rather than the justification for the request.

7. Relevance and Applicability of Judicial Precedents and Circulars:
The Tribunal reviewed various judicial precedents and found that the decisions cited by the Revenue were based on distinct facts and submissions. The Tribunal concluded that the impugned order did not comprehensively appreciate the schema of amendments and conversion of shipping bills. The Tribunal set aside the rejection of the applications for amendment and directed the original authority to decide the matter afresh within the framework of Section 149.

Conclusion:
The Tribunal set aside the rejection of the appellant's request for re-designation of shipping bills and directed the original authority to reconsider the matter afresh, focusing on the propriety of the changes sought under Section 149 of the Customs Act, 1962. The appeal was accordingly disposed of.

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