Legal principle

No drawback can be sanctioned unless the identity of the imported and export goods is established, and conversion of a free shipping bill to a drawback shipping bill is futile where such identity cannot be shown.

Court decision

The Tribunal dismissed the appeal, holding that the jurisdictional Commissioner had validly exercised his discretion under the proviso to Rule 4 in not allowing conversion of the free shipping bill to a drawback shipping bill, and that the impugned order required no interference.

Facts

The goods were imported by a registered dealer under the DFRC scheme and were purchased by Torrent Pharmaceuticals Ltd., which exported them against a pending export order. Under wrong advice, the goods were exported under the ARE-1 procedure under a free shipping bill. The appellants then realised they were not entitled to export rebate since the goods were not manufactured in India but exported as such in the condition in which they were imported. They applied for conversion of the free shipping bill into a drawback shipping bill, which the Commissioner of Customs (Seaport-Export), Chennai rejected by Order-in-Original No.12466/2010 dated 26.7.2010. The appellants appealed to the CESTAT, South Zonal Bench, Chennai.

Key provisions

• Rule 4, Re-export of imported goods (Drawback of Customs duties) Rules, 1995 — Statements/Declarations to be made on exports other than by post