• Dated 22nd April, 2022
Tax Alert

No relief shall be granted if MEIS claim has been rejected on account of non-mentioning of MEIS scheme in the shipping bills at the time of export, unless such shipping bills are amended.1

Provisions: -

The process of availing the benefit under MEIS scheme is provided Paragraph 3.04 of Foreign Trade Policy 2015-20, that at the time of filing of shipping bills, if the HS Code of the exported product is under the eligible code list (Appendix 3B of MEIS) then the exporter is required to mark "Yes" by clicking "Y" in the rewards column of the shipping bill. All such "Yes" marked shipping bills are transferred from the Customs Database to the DGFT database electronically. Once thepayment for these shipments is realized, the exporter requests the concerned bank to generate and upload an electronic Bank RealizationCertificate (e-BRC) on the DGFT server. After this, for every IEC (exporter), the DGFT database has details of goods exported and theconsequent realization amount.

Facts: -

In the given case, the petitioner has challenged the action of the DGFT by which the MEIS claim has been rejected due to non-mentioning of MEIS scheme in the shipping bills at the time of export due to the clerical error as they could not tick "Y" (for Yes) in the reward column of shipping bills and the system automatically treated the shipping bills as "N" (for No) in the reward column of the shipping bills.

Petitioner Contention: -

Petitioner seeks relaxation or condonation of the procedure lapse of non-mentioning of MEIS scheme in the shipping bills at the time of export as arbitrary and discriminative to direct issue of no objection certificate in hisfavour to certify that the goods were exported by him and they have realised the export proceeds.

The petitioner has submitted a representation to the Policy Relaxation Committee and the said Committee after going through the submissions made and the relevant provisions of the scheme have found that in the shipping bills "Y" (for Yes) was not marked/ticked in the reward column and the system automatically treated the same for "N" (for No) to get the benefit of the scheme.

The petitioners also condemned that they could not avail the benefit of MEIS during 2017-18 and 2018-19 due to the clerical error of the concerned staff and the system automatically has treated the shipping bills as "N" (for No) in the reward column.

Held: -

Hon'ble Madhya Pradesh High Court in this writ admitted that a similar issue came up for consideration before the Kerala High Court in W.P. No. 25339/2019 and it has been held that there is no justification for denying the claim based on such an inadvertent omission. In the matter of condoning such an omission, there cannot be discrimination between the exporters who made the claim within six months and those who have raised the claim after six months of the introduction of the scheme.

As far as the role of DGFT is concerned, as per the policy, unless the petitioner gets the shipping bills amended from the Customs Department, no benefit under the scheme can be extended. Therefore, the petitioners ought to have approached the Customs Department for correction of the shipping bills and after such correction in the shipping bills, the DGFT get jurisdiction or authority to examine the matter. Hence no relief can be granted to petitioners in this writ petition.