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4 2012 (284) ELT 490 (Guj.) 5 2020 (371) ELT 97 (P&H) C/724/2005

8. The learned Department Representative while rebutting these submissions mentioned that goods exported from Bombay in respect of 9 shipping bills had not reached Moscow, which is confirmed by the report of the Russian Customs as there were admittedly delivered in Dubai to M/s M.K. International as confirmed by the delivery order issued by the agent of the shipping company. As per the Reserve Bank of India's Circular no third country exports were permitted to be financed out of the funds from repayments of the state credit. M/s Texcomash Exports, the appellant had received the remittance in India rupees out of this fund of the state credit. Therefore, there is clear violation of the Reserve Bank of India Circular which was issued under Section 73(3) of the Foreign Exchange Regulation Act, 1973. Contravention of this Circular makes goods exported by M/s Texcomash Exports liable for confiscation under Section 113(d) of the Customs Act. The judgment cited by the exporter will not be applicable in this case as that case was not subject to Reserve Bank circular. In the given circumstances, the export remittances by Texcomash in respect of these 9 consignments since exports cannot be treated as export proceeds in respect of Russian consignee, as per the second proviso to Section 75(1) of the Customs Act, where any drawback has been allowed on any goods and the sale proceeds in respect of such goods are not received by the exporter in India within the time allowed under FERA 1973 and such drawback shall be deemed never to have been allowed and such amount is recoverable under Rule 16 and 16A of the Customs and Central Excise Duties Drawback Rules, 1995. Therefore, C/724/2005 disallowance of the drawback under Section 75 read with Rule 16 and 16A of the Customs and Central Excise Duties Drawback Rules, 1995, is right and justified. Impressing upon the competence of DRI officers to issue SCNs, as established by hon'ble apex Court, learned Departmental Representative has prayed for dismissal of appeal.

16. It is also observed from the show cause notice itself that there has been an understanding that 9 containers shipped by Texcomash Export from Delhi to Moscow were to be taken delivery in Dubai itself on surrendering the original bills of landing by the party concern. It was observed to be a normal practice and as per law also delivery could be effected if the original bills of landing were surrendered (para 30 of show cause notice) recites the same. Not only this there were the Landing certificate issued with respect to these consignments as well that too from the Russian company. Any forgery if revealed during a further investigation being committed by the Russian company vis-a-vis the Landing certificate in the light of Drawback Rules in India is highly insufficient to deny the claim of drawback specifically when the goods have crossed Indian territory and to reach to a place outside India. Department has failed to produce any statutory provision or any other evidence C/724/2005 to support the findings of the impugned order. The reliance on Rule 16A of Customs & Central Excise Duties Drawback Rules 1995 is also not appropriate. The provisions do not have any retrospective effect. The exports in question were made at the time prior those rules came into effect. Hence denying drawback invoking the Rule 1995 to the export of the year 1993-94 is otherwise not legally permissible. The amount of Rs. 31,66,822/- as was already refunded by the appellant - exporter to the department is wrongly appropriated by the adjudicating authority below. Finally, the order confiscating the goods has no legs to stand upon when admittedly the goods were allowed to be released provisionally in the year 1995-96 itself.