Legal principle

Procedural irregularities in complying with the Re-export of Imported Goods (Drawback of Customs Duties) Rules, 1995 cannot defeat an importer's substantial right to drawback where the goods remained in customs custody, were re-exported without clearance, and the department itself had already tested them — for procedures are handmaids of justice and not mistresses of law.

Court decision

The Madras High Court (Justice C. Saravanan) allowed the writ petition as prayed for with consequential relief: it directed the respondent to permit amendment of the shipping bill and to refund Rs.13,62,098/- within two months of receipt of a copy of the order, with no costs, in favour of the petitioner.

Facts

M/s. G.T. India Private Limited imported Black Pepper vide Bill of Entry No.3042057 dated 30.08.2017 and paid customs duty of Rs.13,62,098/- after first appraisal. The consignment was subjected to lab testing under the Food Safety and Standards Act, 2006, and the adverse report led to refusal of clearance. The Joint Commissioner (Group-I) in Order-in-Original No.60248 of 2017 dated 11.12.2017 confiscated the goods under Section 111(d) of the Customs Act read with the FSS Act, allowed redemption on payment of Rs.50,000/- fine under Section 125 for re-export only, imposed a Rs.25,000/- penalty under Section 112(a), and directed re-export within 3 months. The petitioner complied and sought conversion of its 'Free Shipping Bill' No.1977648 dated 04.01.2018 into a 'Shipping Bill for Claim for Drawback' under Section 149 to avail Rule 4(a) and 5 of the Re-export of Imported Goods (Drawback of Customs Duties) Rules, 1995; its appeal (Order-in-Appeal Seaport C.Cus.II No.916/2020 dated 31.08.2020) and Section 129DD revision both failed.

Key provisions

• Section 149, Customs Act, 1962 — Amendment of documents
• Rule 5, Re-export of imported goods (Drawback of Customs duties) Rules, 1995 — Manner and time of claiming drawback on goods exported other than by post
• Section 129DD, Customs Act, 1962 — Revision by Central Government
• Section 125, Customs Act, 1962 — Option to pay fine in lieu of confiscation
• Rule 4(a), Re-export of imported goods (Drawback of Customs duties) Rules, 1995 — Statements/Declarations to be made on exports other than by post
• Section 111(d), Customs Act, 1962 — Confiscation of improperly imported goods etc
• Section 112(a), Customs Act, 1962 — Penalty for improper importation of goods