Gujarat High Court
M/S Srf Limited vs Union Of India on 21 June, 2023
Author: Vipul M. Pancholi
Bench: Vipul M. Pancholi
NEUTRAL CITATION
C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 12455 of 2020
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE VIPUL M. PANCHOLI
and
HONOURABLE MR. JUSTICE DEVAN M. DESAI
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1 Whether Reporters of Local Papers may be allowed
to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy
of the judgment ?
4 Whether this case involves a substantial question
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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M/S SRF LIMITED
Versus
UNION OF INDIA
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Appearance:
MR ANAND NAINAWATI(5970) for the Petitioner(s) No. 1
MR DEVANG VYAS(2794) for the Respondent(s) No. 3
MR DHAVAL D VYAS(3225) for the Respondent(s) No. 4,5
MR NIKUNT K RAVAL(5558) for the Respondent(s) No. 1,2
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CORAM:HONOURABLE MR. JUSTICE VIPUL M. PANCHOLI
and
HONOURABLE MR. JUSTICE DEVAN M. DESAI
Date : 21/06/2023
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE DEVAN M. DESAI)
1. By way of this petition, under Article 226 of the Constitution of India, the petitioner has prayed for the following reliefs:
"27(a) that this Hon'ble Court may be Page 1 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined pleased to issue a writ of mandamus or a writ in the nature of mandamus, a writ of certiorari or a writ in the nature of certiorari or any other appropriate writ, order or direction directing respondent No.2 or his officers to allow petitioners to claim benefit under MEIS scheme and setting aside the impugned notice dated 11.2.2020 passed by respondent No.2.
(b) that this Hon'ble Court may be pleased to issue a writ of mandamus or a writ in the nature of mandamus, a writ of certiorari or a writ in the nature of certiorari or any other appropriate writ, order or direction directing respondent No.4 or his officers including respondent No.5 to amend the shipping bills to claim benefit under MEIS scheme.
(c) that this Hon'ble Court may direct the respondents to allow modification in the online system to enable the petitioners to correct the technical error by allowing selection table `yes' for shipping bill to be under reward scheme and process the application to grant export incentives under Page 2 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined MEIS to the petitioner or alternatively direct respondent Nos.4 and 5 to recall and amend the 12 shipping bills granting the MEIS benefit."
2. Heard learned advocate Mr. Anand Nainawati for the petitioner, Mr. Devang Vyas, learned ASG assisted by learned advocate Mr. Karan Sanghani for respondent No.1 as well as learned advocate Mr. Pratik Khubchandani for Mr. Dhaval D. Vyas for respondent Nos.4 and 5.
3. With the consent of the learned advocates for the respective parties, this petition is taken up for final hearing at the stage of admission. Rule. Respective learned advocates waive service of notice of Rule for and on behalf of the concerned respondents.
4. The brief facts of the case are as under:
4.1. The petitioner is a company Page 3 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined incorporated under the provisions of Indian Companies Act, 1956. The petitioner company is also registered with the Directorate General of Foreign Trade and is holding import export code No.0588109592. The petitioner is engaged in exporting Hydroflurocarbons - Tetrafluroethane for various industrial use by various customers. It is submitted by the learned advocate for the petitioner that the chapter 3 of the Foreign Trade Policy provides for exports under Merchandise Export from India Scheme (hereinafter referred to as `MEIS') to the exporters who are engaged in exports of notified goods. It is further submitted that in the case of EDI Shipping Bills who intend to avail benefits under MEIS has to declare by selecting `Y' (for yes) in the reward column.
4.2. It is the case of the petitioner that due to oversight of the petitioner's custom agent, while processing shipping bills, processed Page 4 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined shipping bills with default option `No' instead of selecting `Yes' for making exports under the MEIS scheme. Resultantantly, the exports were not considered for export incentives benefits.
4.3. It is further submitted by learned advocate for the petitioner that as a matter of fact, the petitioner - company were entitled for the same. On realizing such technical error, the petitioner first approached the Deputy Commissioner (Exports), Customs House, Mundra
- respondent No.5, herein by writing a letter dated 8.8.2017 inter alia requesting to amend the shipping bills filed in November, 2016 by rectifying the reward column from `No' to `Yes.' 4.4. Upon receipt of he said communication dated 18.9.2018, respondent No.5 informed the petitioner that out of 8 shipping bills filed in 2016, amendment has been carried out in respect Page 5 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined of 7 shipping bills. However, vide letter dated 15.11.2018, the petitioners were informed by the respondent No.5 that the said amendment dated 18.9.2018 has been withdrawn in light of various notices issued by respondent No.3 i.e. Director General of Foreign Trade. It was further directed by the respondent authority to the petitioner to approach directly with the jurisdictional office of the Director General of Foreign Trade in relation to the issue involved. Pursuant to this, email dated 1.3.2019 was made to the respondent No.2 and the petitioner too was informed that respondent No.5 has denied manual correction in the shipping bills and the benefit under the scheme for the said shipping bills may kindly be granted to the petitioner. Another communication dated 11.4.2019 together with an email of the even date was sent to the respondent and reminder dated 9.5.2019 was also sent to the respondent authority.Page 6 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023
NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined
5. The petitioner, thereafter lodged a complaint dated 26.8.2019 with respondent No.2 for non action on the request of granting MEIS benefit. However, respondent No.2 did not adhere to the said complaint and closed the complaint with remark "manual amendments are not transmitted to the DGFC server and thus, MEIS is not granted to the online e-form module for this shipping bills"
6. It is further submitted by learned advocate for the petitioner that vide communication dated 16.10.2019 was written to the respondent No.5, a request was made to transmit EDI shipping bills to the portal of DGFT and thereby, allow the benefits of MEIS scheme. Various reminders were also sent to that effect by the petitioner.
7. It is the case of the petitioner that communication Page 7 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined dated 10.12.2019 from the Principal Commissioner issued to the petitioner reveals that the said request was not accepted by the respondent authorities. As the requests were not adhered to by the respondent authority, the petitioner approached Policy Regulation Committee (hereinafter referred to as `the PRC') of respondent No.2 for the waiver of procedure of declaration of intent to avail the benefit of MEIS. The said complaint was not given any hearing and the same was rejected by PRC in its meeting No.30/AM20 dated 11.2.2020.
8. The petitioner filed various shipping bills in the year 2016 and 2019 respectively, wherein, the intent was declared in affirmative in words on the shipping bill, however, reward column was inadvertently filed as `No'.
9. Learned advocate for the petitioner in support of Page 8 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined his contentions has placed reliance on the following decisions:
(a) M/s. Banco Products (India) Limited v. Union of India - SCA No.15069 of 2020 dated 15.12.2021 (Paragraph No.14 thereof)
(b) Anupam Port Cranes Corporation Limited v. Union of India of Division Bench of this Court - SCA No.5719 of 2021 dated 15.6.2023.(Paragraph No.13 thereof)
10. Paragraph No. 14 in the case of M/s. Banco Products (India) Limited (Supra) is reproduced hereunder:
"14. Having heard both the sides and also on a carefully considering the chronology of events, we notice that it is a genuine mistake on the part of the Page 9 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined petitioner which has led the petitioner approaching this Court for prayer of permitting the bill manually. We notice that the respondent Nos.1 and 2 had permitted the manual amendment of shipping bill in question being the shipping bill bearing No.5561585 dated 14.06.2018 while filing shipping bill online in EDI system of the customs inadvertently systems had got been corrected value of goods exported as has been noted by the PRC Committee in its meeting. A representation made had weighed with the said Committee. The Customs, Mundra had assessed and finalized the consignment, however, the amendment since had not been reflected in EDI systems of the DGFT, that resulted in preventing filing the MEIS claim. Hence, the Committee in its report dated 30.10.2018 had referred the matter to EDI / NISD for DGFT to make suitable provisions to grant MEIS benefits against the same shipping manually. The Committee had also reviewed on 24.09.2019 on the basis of the comments received from E-Page 10 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023
NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined Governance and Trade Facilitation (EGTF) section and observed that the reflection of such manual amendment in the automated system is not feasible, hence, request of the firm has been rejected. The issue is more of procedural in nature than of substantive kind as the software has the limitation and it does not permit even after the manual correction of the shipping bill, the benefit to flow of MEIS Scheme as it does not recognize said manual correction, the petitioner is deprived of the benefits."
11. Similarly, learned counsel for the petitioner has further relied upon the decision in the case of Anupam Port Cranes Corporation Limited (Supra). Paragraph No.13 of the said decision is reproduced hereunder:
"[13] We are of the view that the
aforesaid contentions taken by the
respondents is misconceived. It is
pertinent to note that in para 12 of the Page 11 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined aforesaid decision rendered by this Court, this Court has recorded similar type of contentions which is taken in the present case in the Affidavit-in-reply filed by the respondents, more particularly, paras 11(b) as well as 12(a) of the Affidavit-in-reply. In the present case as observed hereinabove, the concerned respondent himself issued Trade Notice dated 21.02.20218 in pursuance of the representations received from the various exporters, who have faced similar type of difficulty while submitting the shipping bills, who have specifically declared the intent in the affirmative (in wordings) on the shipping bills. In the present case, as observed hereinabove, the petitioner has specifically stated (in wordings) the intention to claim the 'Reward' for MEIS. Therefore, we are of the view that the facts of the present case are almost similar to that of the case of the petitioner of Special Civil Application No.11038 of 2020."
12. Per contra, learned advocates for the respondents Page 12 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined have mainly submitted that the present petition is not maintainable and deserves to be dismissed as the decision taken by the respondent authority is as per the law and is not liable to be set aside. 12.1. It is further submitted by the respondents that once the petitioner has chosen the default option `No' without selecting `Yes' for making exports under the MEIS scheme, the manual amendment is not permissible. 12.2. It is further submitted by the learned advocate for respondent Nos.2 and 3 that the declaration as `yes' is legal and procedural requirement under the provisions of the Handbook of Procedures 2015-2020. In the said Handbook of Procedures, para 3.14 has been referred to by the learned advocate for the respondents. It is further submitted that the `procedure for declaration of intent' needs to be Page 13 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined fulfilled in order to claim the benefit under the scheme.
12.3. It is further submitted by learned advocate for the respondent Nos.2 and 3 that the grant of MEIS benefit is not rejected merely on technical grounds but since the petitioner failed to comply the said procedures, the benefit of the said scheme has been rejected.
12.4. It is further submitted that non- marking of `yes' in the shipping bills was violation of mandatory requirement to be fulfilled, as per the Handbook of Procedure of the Foreign Trade Policy 2015-2020. It is further emphatically submitted by learned advocate for the respondent No.2 and 3 that if the petitioner wanted to avail the benefits of MEIS, the procedure prescribed in the handbook of procedures needs to be satisfied by the petitioner.
Page 14 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023
NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined 12.5. Learned advocate for respondent nos.1, 4 and 5 has mainly relied upon the averments made in the affidavit-in-reply filed by them. Learned advocate for the respondent Nos.1, 4 and 5 has relied upon the said Handbook of Procedure, more particularly, para 3.14 and has also submitted that this procedure more particularly para 3.14 being mandatory and the petitioner has clicked 'no' button instead of `yes.' 12.6. The issue involved in the present case is no more res integra in light of the decisions in the case of M/s. Banco Products (India) Limited (Supra) and Anupam Port Cranes Corporation Limited (Supra). There is no much resistance by learned advocate for the respondents regarding the ratio laid down by the coordinate bench of this Court in the decision M/s. Banco Products (India) Limited (Supra) & Anupam Port Page 15 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined Cranes Corporation Limited (Supra). 12.7. In both the above decisions the issue and question was similar to the issue and question involved in the present case. 12.8. In our opinion, the main contention of the respondent authority is based on the Handbook of Procedure. In our considered opinion, the said provisions of Handbook of Procedure 2015-2020 is a procedure which enables the claimant to avail the benefits of the scheme. Procedures are handmade law and it is not a direction under the law.
12.9. In the present case, the petitioner has already mentioned in the invoice that he has opted for the benefit under the MEIS scheme and has clearly mentioned in the invoice that "I/WE hereby declare that we intend to claim benefit of Page 16 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined merchandise exports from India scheme MEIS." 12.10. Thus, merely a technical lapse would not debar the petitioner from availing the benefits under the scheme which has been floated by the respondent authorities.
12.11. The rejection of the benefits is merely a technical rejection based on non- compliance of clauses of the procedure which, in our opinion, respondent authorities could have avoided and could have granted the benefit under the scheme and could have amended the shipping bills.
13. On perusal of the invoice, the petitioner has mentioned that "I/WE HEREBY DECLARE THAT WE INTEND TO CLAIM BENEFIT OF MERCHANDISE EXPORTS FROM INDIA SCHEME MEIS". Thus, the petitioner has already mentioned in the shipping Page 17 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined invoice and has declared its intention to avail the benefits of the MEIS scheme. Thus, merely an error of clicking `No' instead of 'Yes' does not debar the petitioner from availing the benefits under MEIS scheme. More particularly, the communication reveals that the intention of the petitioner was to avail the benefit of MEIS.
14. In view of the totality of the facts, we are of the opinion that decision of the respondents is erroneous and requires an interference by this Court. The petitioner - company is entitled to claim the benefit under MEIS scheme and hence we set aside the notice dated 11.2.2020 passed by respondent No.2 the same is quashed hereby. The concerned respondents are also directed to amend the shipping bills and also further directing the respondents to allow the modification in online system to enable the petitioner to correct the technical error by Page 18 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023 NEUTRAL CITATION C/SCA/12455/2020 JUDGMENT DATED: 21/06/2023 undefined allowing selection table `Yes' for shipping bills to be under reward scheme and thereby process the application to grant export incentives under MEIS scheme to the petitioner.
15. Resultantantly, this petition is allowed. Rule is made absolute to the aforesaid extent. Direct Service is permitted. No order as to costs.
(VIPUL M. PANCHOLI, J) (D. M. DESAI,J) VATSAL Page 19 of 19 Downloaded on : Sat Sep 16 20:27:45 IST 2023