CESTAT rules against rejection to alter bills under Foreign Trade Policy

CESTAT rules against rejection to alter bills under Foreign Trade Policy

Directs authorities to decide the matter afresh within the framework of the Customs Act

The West Zonal bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has allowed the appeal of the assessee by holding that the rejection of the request for alteration of shipping bills to 'advance authorization scheme' in the Foreign Trade Policy (FTP) is not justified.

The appellant, Seco Tools India (P) Ltd, had requested for re-designating 275 shipping bills, filed between 22 September 2009 and 30 August 2011. These related to exports towards discharge of obligation against a licence issued to them under FTPs scheme.

Under the Customs Act, 1962 the application intimated that having incorporated the details of the corresponding authorizations in the shipping bills, they overlooked the categorization of the bills at the top of the page as 'free shipping bills' until the export obligation was discharged and the licencing authority pointed it out as deficiency impending the redemption.

The request was denied for not adhering to the Central Board of Excise & Customs (CBEC) 2010 circular, which restricted conversions only to certain classes of bills. The subjective satisfaction intended under the Customs Act could be elicited from documentary evidence available at the time of export. And only if sought within three months from the date of the 'let export order' endorsed in the shipping bills.

The Coram of Justice Dilip Gupta (president) and C J Mathew (technical member) observed that the plea was for alteration of the category of bills to that of the scheme of export under which the appellant claimed to operate.

The bench further stated that the intent of the impugned exports on the discharge of obligation under the 'advance authorization scheme' was evident from the bills. Only the title of the bills required alteration for enabling the appellant to remedy the defect pointed out by the licensing authority.

In view of the Haldiram Foods International Pvt Ltd case, which upheld the irrelevance of the deadline stipulated in the CBEC circular, the tribunal set aside the rejection of the applications for amendment. It directed the authorities to decide the matter afresh within the framework of the Customs Act.