Davinci Leather Pvt. Ltd. Vs Commissioner of Customs
(Madras High Court)

Case Facts:

The petitioner engaged in the export of leather shoes. Under the Merchandise Exports from India Scheme (MEIS), a person exporting the specific goods on and above the specific quantity can be eligible for availing the benefit under the said scheme. So, the petitioner while filing of the shipping bill had inadvertently omitted to select ‘Yes’ on the online platform as an option for availing the MEIS benefit as said in the above context.

The entitlement to the MEIS benefit is verified and accepted by the Director General of Foreign Trade (DGFT) on an application made in this behalf by the petitioner. While examination, the DGFT found the error in the form submitted by the petitioner and advised the petitioner to have a shipping bill amendment by the Customs Authorities.

As per the advice given by DGFT, the petitioner made an application to the Customs Authorities for amendment in the Bill containing the error. The second respondent, upon consideration of the reasons mentioned in the application regarding the filed Bill containing error, has rejected the same by order dated on 18.11.2019.

The present petition is filed against the second respondent in Madras High Court. Mr.Rajnish Pathiyil, learned Central Government Standing Counsel accepts notice for the respondents. The said Counsel heard the learned counsel for the petitioner and learned counsel for the respondent. By consent expressed by both learned counsel, the writ petition is disposed even at the stage of admission.

Issues:

1. Is MEIS benefit available even the option ‘Yes’ is not availed inadvertently in the online form?

2. Whether DGFT officials can override the Bill containing the error without the consent of Customs Authorities?

Holdings:

1. The petitioner as a bona fide, inadvertently omitted to select the option ‘Yes’ while submitting the file, so there might be a chance of further amendment or procedures imposed on the petitioner for availing the benefit but the benefit cannot be misplaced.

42. Article 300A provides that no person shall be deprived of property saved by authority of law. While right to the property is no longer a fundamental right but it is still a constitutional right. Credit earned under the erstwhile Custom Law is the property of the writ applicants and it cannot be appropriated for merely failing to file a declaration without error in this respect. It could have been appropriated by the authorities by providing the same for amendment in the Custom Law but it cannot be taken away by virtue of merely framing Rules in this regard.’

2. As per the explanations given by the Foreign Trade Policy the Director General of Foreign Trade (DGFT) doesn’t have any authority to amend the filed return with the prior permission of the Customs Authorities in this regard.

Familiar cases:

• Pasha International V. Commissioner of Customs, Tuticorin (2019 (365) ELT 669)

• Global Calcium Pvt. Ltd. V. Asst. Commissioner (order dated 10.06.2019 in W.P.No.3321 of 2019)

In the similar cases, held that the case is in favour of the petitioner and dismissed the rejection of the second respondent on the application of the petitioner.

Court’s rationale / Judgement:

Mr. Rajnish Pathiyil fairly does not dispute this, should not stand in the way of the consideration of entitlement on merits. As far as entitlement itself is concerned, I have already observed that the benefit of the Scheme would be available to the petitioner conditional upon verification and acceptance of such claim by the DGFT.

In the lights of the discussion of the above, held that the impugned order rejecting the request for amendment is quashed and a mandamus issued to the second respondent to amend the shipping as sought for, by the petitioner. The writ petition is allowed and costs relating to the petition are entitled to be reimbursed to the petitioner by the second respondent.

Disclaimer:“The information contained herein is only for informational purpose and should not be considered for any particular instance or individual or entity. We have obtained information from publicly available sources, there can be no guarantee that such information is accurate as of the date it is received or it will continue to be accurate in future. No one should act on such information without obtaining professional advice after thorough examination of particular situation.”