Verification of fulfillment of export obligations and the application of customs notifications in accordance with the Customs Act.

S. RAVINDRA BHAT, J.

1. The petitioners challenge an order/letter of 24.10.2017 issued by the respondents (hereafter referred to as the ‘Customs Authorities’) which had rejected the request for conversion of Bills of Entry for Home Consumption to Bills of Entry for Warehousing and further, directions to permit clearance of the goods in terms of the Notification No.18/2015-cus dated 01.04.2015, as amended by Notification No.79/2017-cus dated 13.10.2017 are sought.

2. The petitioners relied upon Section 18(1)(a) of the Customs Act, 1962 and sought provision of assessment of its goods. Accordingly, orders were made on 16.11.2017. By this Court’s order of 27.11.2017, the goods were permitted to be released on condition of the petitioners furnishing an undertaking-cum-bond to the respondents – Customs Authority, but without payment of countervailing duties.

3. Learned counsel relied upon the decision of the Supreme Court in the case of Government of India versus Indian Tobacco Association, 2005 (187) ELT 162, to say that if a subsequent notification subsists, the levy or any part thereof dealt with by previous notification, the latter notification ought to be read as effective from the previous date of the earlier notification. It is thus urged that Notification No.79/2017-cus issued on 13.10.2017 is said to have applied in respect of the imports that were subject-matter of the Bills of Entry involved in the present case.

4. It is pointed out that in certain similar situations, this Court had occasion to dispose of the petitions under Article 226 of the Constitution of India that primarily concerned the levy of IGST in the light of Circulars and Press Release dated 13.10.2017, which had amended or rather brought into force certain exemption notifications on the subject. In one such proceedings this Court had in Jindal Dyechem Industries (P) Limited versus Union of India & Others, W.P.(C) 8677/2017 decided on 16.04.2018, stated as follows:-

“The petitioner’s grievance is with respect to the respondents’ refusal to grant it the facility of exemption from payment of customs levy for the goods imported solely for the purpose of fulfilling export obligations. The petitioner was issued advance authorisations under the extant Foreign Trade Policy 2015-20. The petitioner contends that the prevailing exemptions under the custom notifications, could not have been denied merely on the premise of the introduction of a new levy under the Goods and Service Tax with effect from 01.07.2017.

This Court had while entertaining these proceedings made an interim order on 11.10.2017 in the following terms :

“1. Notice. Mr. Sanjeev Narula, the learned CGSC, accepts notice for the Respondents. He has placed before the Court a Press Release issued by the Ministry of Finance dated 6th October 2017 setting out the relief package announced for exporters by the Goods and Service Tax Council (‘GST Council’) at its 22nd Meeting held on 6th October 2017. Inter alia, the following relief measures announced were announced:-

“a. Within the next 4 days i.e. by 10.10.2017 the held-up refund of IGST paid on goods exported outside India in July would begin to be paid. The August backlog would get cleared from 18.10.2017 and refunds for subsequent months would be handled expeditiously. Other refunds of IGST paid on supplies to SEZs and of inputs taxes on exports under Bond/LUT, shall be processed from 18.10.2017 onwards. For this, the Council agreed to suitably empower Central and State GST officers so that exporters get refunds from one authority only. Related matters of settlement of funds are being resolved.

b. To prevent cash blockage of exporters due to upfront payment of GST on inputs etc. the Council approved two proposals, one for immediate relief and the other for providing long term support to exporters. Immediate relief is being given by extending the Advance Authorization (AA)/Export Promotion Capital Goods (EPCG)/100% EOU schemes to sourcing inputs etc. fro