The Appellant had obtained an advance authorization license, while exporting certain paints vide two shipping bills. However, the Appellant did not enter correct scheme code in the shipping bills i.e., mentioning ‘00’ instead of mentioning the scheme code as ‘01’. To correct this mistake, the Appellant had filed an application u/s. 149 of the Customs Act for conversion of free shipping bills to advance authorization shipping bills. However, the request was rejected on the basis of the time limit of 3 months prescribed in Board Circular No. 36/2010 and that goods exported were not subjected to physical examination. Aggrieved, the Appellant preferred and Appeal before the Chennai CESTAT.
As regards the limitation, the Tribunal observed that when the statute does not prescribe any time limit for filing an application for conversion of a shipping bill, the department cannot rely upon a circular to frustrate the provisions contained in the statute. When there is a conflict, the statute will definitely prevail over the Board circular.
In respect of rejection of rectification application on the ground of no physical verification, the Tribunal observed that, there is no requirement u/s. 149 that the amendment can be allowed only if the goods have been subjected to physical examination before export. In view of the above observations, the Tribunal held that the rejection of request for conversion of free shipping bills to advance authorization scheme shipping bills is not justified.
Carboline India Private Limited [2022-TIOL-168-CESTAT-MAD]
AUTHORS’ NOTES :
It is trite law that Circulars, being a subordinate law, cannot override the statutory provisions under law. The Madras HC in RE: Precot Meridian Limited [2019 ACR 813] had held that Circulars are issued only to clarify the statutory provision and it cannot alter or prevail over the statutory provision. It shall be further noted that the Courts have time and again allowed rectification of Shipping Bills where the assesses have inadvertently entered the incorrect scheme code. In RE: Visoka Engineering Private Limited [TS-61-CESTAT-2022-CUST] had held that rejection of request for conversion of free shipping bills to Advance Authorization Shipping Bills are not justified.
Disclaimer:
The information provided in this update is intended for informational purposes only and does not constitute legal opinion or advice. Readers are requested to seek formal legal advice prior to acting upon any of the information provided herein. This update is not intended to address the circumstances of any particular individual or corporate body. There can be no assurance that the judicial/ quasi judicial authorities may not take a position contrary to the views mentioned hereinrra quis.
Sign up for the Newsletter