TMI Blog2005 (12) TMI 570X X X X Extracts X X X X X X X X Extracts X X X X ..... 3727.00 5 RAJ-2401065 24/03/2000 465793.00 6 2410000078 04/05/2000 229151.00 7 2410000110 10/05/2000 339245.00 8 2410000273 13/06/2000 322469.00 9 2410000495 31/07/2000 94367.00 10 2410000543 28/08/2000 39113.00 11 2410000555 28/08/2000 36987.00 12 2410000827 04/10/2000 125188.00 (B) Your Lordships may be pleased to issue a writ of mandamus, or a writ in the nature of mandamus holding and declaring that the Customs authorities have no jurisdiction to verify the classification of exported goods and the rate of credit decided by the DGFT authorities for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Handbook of Procedures. It is the case of the petitioner that the Customs Authorities after carrying out verification in terms of the provisions of paragraph No. 7.43 of the Handbook of Procedures, were required to return the DEPBs to the petitioner, after which the petitioner could use the DEPB credit or transfer the said DEPBs. That, despite several requests to the concerned authorities of the Customs Department to do the needful at the earliest with regard to the DEPBs presented to them, no action was taken by the concerned respondents. 5. As the DEPBs are valid only for a period of 12 months from the date of their issuance, the petitioners have approached this Court by way of the present petition seeking a direction against respondents No. 2 and 3, to return the original DEPB licences with verification reports as contemplated under paragraph 7.43 of Handbook of Procedure (Vol.I) 1997-2002. 6. Heard Mr. Uday Joshi, learned Advocate appearing on behalf of the petitioners and Mr. Y.N. Ravani, learned Additional Standing Counsel appearing on behalf of the respondents. 7. Mr. Joshi has drawn attention to the provisions of the Export and Import Policy, 1997-2002 (EXIM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le against such export products and at such rates as may be specified by the Director General of Foreign Trade by way of public notice issued in this behalf, for import of raw materials, intermediates, components, parts, packaging material, etc. The holder of Duty Entitlement Passbook Scheme (DEPB) shall have the option to pay additional customs duty, if any, in cash as well. Paragraph No. 7.15 provides that the DEPB shall be valid for a period of 12 months from the date of issue. 11. Paragraph No. 4.11 of the EXIM Policy provides that the Director General of Foreign Trade (DGFT) may, in any case or class of cases, specify the procedure to be followed by an exporter or importer or by any licensing, competent or other authority for the purpose of implementing the provisions of the Act, the Rules and the Orders made thereunder and the EXIM policy. That, such procedures shall be included in the Handbook (Vol.1), Handbook (Vol.2) and in ITC (HS) and published by means of a Public Notice. Accordingly, in Handbook of Procedures (Part-II), the procedure in relation to Duty Entitlement Passbook has been set out. 12. Paragraph No. 7.38 of the Handbook provides that an application f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zed for payment of customs duty on goods which are imported into India. Before allowing imports against the DEPB, the Customs authorities are required to verify that the details of exports, as given on the DEPB, are in accordance with their records. 17. On a plain reading of the scheme of the DEPB, it is apparent that determination of credit under the DEPB falls solely within the domain of the licensing authority, namely the DGFT or the officer authorised by him, who are empowered to issue DEPB licence to the exporter. At the time of issuance of licence, the licensing authority determines the DEPB credit to which the exporter is entitled on the basis of the shipping bills and other prescribed documents submitted by the exporter. Under the scheme, the only function of the Customs authorities is as prescribed under paragraph No. 7.43 of the Hand Book of Procedure, namely, to verify as to whether the details of exports as given in the DEPB are in accordance with their records. Page 157 Thus, the role of the Customs authorities is limited to verification of the details on the DEPB, to ascertain as to whether they tally with their records, and nothing more. Once the licensing authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etitioners. Once the licensing authority has held that the export product is covered under the DEPB scheme and has issued DEPB licence, it is not open to the Customs authorities to take a stand that the export product is not covered under the DEPB scheme. Such action on the part of the Customs, of questioning the entitlement of the petitioners to credit under the DEPB licence issued by the licensing authority is beyond the bounds of their authority, without jurisdiction and bad in law. 20. At this stage, it is necessary to take note of the fact that as and when the shipping bills were presented the Customs Authorities were duly empowered to assess and undertake such an exercise after taking into consideration the shipping bills presented before them at the time of export. Such an exercise consisted of classification of the goods, levying customs duty at an appropriate rate and thus discharging the duty which the Page 158 Customs Authorities were required to discharge under the provisions of the Customs Act, 1962. The stage at which the impugned action is sought to be initiated is not the stage at which the Customs Authorities can undertake the exercise to classify the goods and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioned in Annexure SF to the petition and to return the same to the petitioners and that respondent No. 4 be directed to extend the validity of the said DEPB licences for a period of six months from the date of such validation. On 20/9/2001, this Court has passed an order on the said Civil Application in the following terms : 2. Having heard the learned Counsel for the parties on the question of grant of interim relief, we direct that regardless of the fact of expiry of Duty Entitlement Pass Book (DEPB) Licence, the applicants be allowed Page 159 to avail the total credit claimed to the tune of ₹ 24,60,088/- as per Annexure-F at page 28 and 29 to the petition, however, subject to their furnishing Bank Guarantee for the entire credit which was given to the applicants after expiry of Licence. 25. However, it appears that despite the specific direction of this Court permitting the petitioners to avail of the total credit to the tune of ₹ 24,60,088/- subject to furnishing Bank Guarantee for the entire credit which was given to the petitioners after expiry of the licence, the petitioners did not abide by the same. Instead, the petitioners moved an application being Civi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly assessed by the respondent No. 3. On the basis of such finally assessed Shipping Bills, the respondent No. 4 issued two DEPB licences in December, 1999. The DEPB licences were lodged with the respondent No. 3 for verification in terms of paragraph No. 7.43 of the Hand Book of Procedures 1997-2000. However, instead of returning the DEPB licences after verification thereof, the respondent No. 3 issued an undated Show Cause Notice interalia calling upon the petitioners to show cause as to why the benefit of DEPB claimed and obtained by them should not be denied as the goods exported by them do not fall under the serial numbers as claimed by them and no DEPB rate was prescribed for the same. 4. Pursuant to the said show cause notice, the respondent No. 3 passed an Order-in-Original dated 7.11.2000, holding that the petitioners are not entitled to DEPB benefits on export products covered under the Show Cause Notice and that, therefore, the DEPB credit of ₹ 1,36,972.92 is denied. 5. It is the case of the petitioners that the role of the Customs authorities is limited to verification of details of export as given on the DEPB licences as to whether they are as per their rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in Civil Application No. 8347 of 2001 in Special Civil Application No. 1326 of 2001 and Civil Application No. 8349 of 2001 in Special Civil Application No. 2380 of 2001, this Court had in the facts and circumstances of the case directed that should the petitioners give Bank Guarantee in each of the two matters to the tune of the amounts mentioned in the operative part of the respective orders to the satisfaction of the Deputy Commissioner of Customs (Group VII), Customs House, Kandla within a period of four weeks from the date of the said order, the operation of the impugned orders shall remain stayed and the respondent No. 3, Deputy Commissioner of Customs (Group VII), Customs House, Kandla, may complete the procedural formalities as contemplated in Para 7.43 of the Hand Book of Procedure, Volume I, for the licence of the petitioners and return the same to the respective petitioners and thereupon the Joint Director of Foreign Trade, Rajkot, may extend the date of the licences, which have already expired, in accordance with law for a suitable period so that the licences can be used. 9. It is an accepted position, that the parties have complied with the aforesaid interim order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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