By TIOL News Service

MUMBAI, JAN 22, 2015: THE issue involved is whether free shipping bills can be allowed to be converted into drawback shipping bills.

Against the order of the lower authorities the appellant Air India is before the CESTAT.

The AR raised a preliminary objection that since the issue involved in this case is of conversion of free shipping bills to drawback shipping bills the matter should be heard by a Division Bench of the Tribunal in view of the decision in Midex Global Pvt. Ltd. Vs. Commissioner of Customs, Pune - 2014-TIOL-2124-CESTAT-MUM

The appellant submitted that the issue involved is confined to conversion of free shipping bills to drawback shipping bills and it does not involve the issue of either rate of drawback or quantum of drawback. It is further submitted that this particular nature of case is covered under clause (b) of sub-Section (4) of Section 129C of Customs Act, 1962. The decisions in Fontansey Engg. Exports Pvt. Ltd. Vs. Commr. Cus. (E), Mumbai - 2008-TIOL-1105-CESTAT-MUM, Nucleus Satellite Communications Pvt. Ltd. Vs. CC(S), Chennai - 2007-TIOL-1146-CESTAT-MAD & Hero Cycles Ltd. Vs. Commr. of Cus. Shillong - 2004-TIOL-654-CESTAT-DEL were cited in support.

The Single Member (Judicial) disagreed with the judgment of coordinate bench in the case of Midex Global Pvt. Ltd. Vs. Commissioner of Customs, Pune (supra) and observed that the case is covered by clause (b) of sec.129C(4) of the Customs Act, 1962. Inasmuch as the matter should be heard by Single Member Bench. It was also observed that in the case of Midex Global Pvt. Ltd., in the first round of litigation, Single Member Bench of the Tribunal had disposed of the appeal by way of remand and, therefore, in the very same case, the view of the coordinate bench that matter should be heard by the Division Bench appears to be not convincible.

The Single Member(J) further observed -

"5.2 In my view the present case i.e. conversion of free shipping bills to drawback shipping bills does not involve any issue either of rate of duty or value of goods and it does not involve any quantum of drawback. Therefore, there is no doubt that the present case falls under clause (b) of sub-section of Section 129C and should be heard by a Single Member Bench. I have also observed that in catena of judgments the very same issue has been heard and decided by the Single Member Bench….

6. From the provisions of Section 129C(4) and also view taken by the various coordinate single member benches, I am of the view that the present case which involves only conversion of free shipping bill to drawback shipping bills can be heard by Single Member Bench. Since coordinate bench in the case - 2014-TIOL-2124-CESTAT-MUM Midex Global Pvt. Ltd. Vs. Commissioner of Customs, Pune has taken different view that this nature of cases should be heard by Division Bench and not by Single Member Bench, I direct the registry to place this matter before the Hon'ble President for constituting a larger bench to decide the issue "whether case involved conversion of free shipping bills to drawback shipping bills can be heard by the Single Member Bench or by Division Bench"."

In passing : The wait begins…as always.

(See 2015-TIOL-168-CESTAT-MUM)