The Bombay High Court has directed the Directorate Of Foreign Trade (DGFT) to pay a cost of Rs. 50,000 to Larsen & Toubro Limited (L&T).
The bench of Justice M.S.Sonak and Justice Jitendra Jain has observed that the DGFT cannot adopt an attitude that its technological systems are not geared to deal with such situations and that its officials will not deal with such situations. Human and artificial intelligence must join to serve the people and achieve ease of business and not be at loggerheads.
The bench directed DGFT and Additional DGFT to process Petitioner’s application for the release of MEIS Scrips and, if the Petitioner is found eligible for the issue of such MEIS Scrips, to release the same within 15 days from today.
The court clarified that the DGFT shall not, again, hold the Petitioner ineligible on the ground that its systems are not geared up to fully take cognisance of the manual amendments to the shipping bills or on account of any other systemic or technical issues in the DGFT’s portals and system.
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Background
The petitioner, L&T sought the directions for the DGFT to accept the amendment made in three shipping bills vide amendment certificates dated 17 October 2019 and flag “Y” appearing on ICEGATE under the head “REWARD” against the three shipping bills and issue and grant MEIS Scrips amounting to Rs.1,61,34,190 to the Petitioner.
In the shipping bills, the Petitioner, the Petitioner’s Customs brokers inadvertently declared the Petitioner did not intend to claim the Merchandise Exports from India Scheme (MEIS) benefit by indicating the letter “N” instead of “Y” in the relevant digital REWARD column.
By Notification dated 1 April 2015, the MEIS scheme was introduced, which seeks to promote the export of notified goods manufactured/produced in India and provide exporters rewards to offset infrastructural inefficiencies and associated costs. The Petitioner claims that there is no dispute about the Petitioner being eligible for the benefit of the MEIS scheme. However, the Petitioner is now being denied such benefit due to the error while submitting three shipping bills, even though the mistake has already been corrected following the law.
Upon realising the error, the Petitioner attempted to correct the same digitally. However, the digital system was not tuned to accept the correction of such mistakes. Therefore, by application dated 9 October 2019, the Petitioner sought leave to correct the errors in the said three shipping bills manually.
The Superintendent of Customs (Exports) (Respondent No.6) allowed the correction of the error and permitted amendment manually. This was through a certificate of amendment. The certificates clearly state that since the amendment cannot be carried out in the shipping bills in the EDI system post clearances, the amendment is permitted manually and the certificate is being issued on the request of the exporter and with the approval of the Deputy Commissioner, Customs, Hazira.
Armed with the certificate, the Petitioner approached the Additional Director General of Foreign Trade to accept the manual corrections and issue the necessary MEIS Scrips in terms of the Notification dated 1 April 2015.
The Additional Director General of Foreign Trade rejected the request on the grounds that there was no scope for considering such manual applications and advised the Petitioner to submit online applications. The Petitioner did attempt to apply online, but the DGFT portal and the established systems were not tuned to deal with this type of situation.
Due to systemic issues, the Petitioner could not apply electronically to the Additional Director General of Foreign Trade for the issue of the MEIS Scrips.
The Petitioner was once again advised to proceed electronically, which the Petitioner, in fact, did. However, the electronic application required the Petitioner to state whether this was a PRC/Court case-approved matter. Since the Petitioner’s case, the matter had not travelled to PRC or the Court, the Petitioner was constrained to mark this column as “NO”. After this, the system would not permit the Petitioner to proceed further. It is at this stage that the Petitioner instituted the writ Petition.
Conclusion
The court stated that the DGFT and its officials were not justified in refusing to consider the manually corrected shipping bills, particularly after the Customs Authorities allowed them to be amended by exercising their powers under Section 149 of the Customs Act. In any event, the DGFT and its officials were not justified in refusing to consider the amendments finally carried out electronically on the specious plea that the DGFT portal or the DGFT systems could not handle such situations.
The court held that artificial intelligence cannot be at the cost of mortgaging human intelligence entirely. Technology is to serve the people and not to place booby traps and make life extremely difficult for the people. It is otherwise. If there are some gaps in the existing handling systems, bonafide parties cannot be made to suffer. The human element endowed with discretion and reason must step in.
The court held that the officials operating such systems, or the officials tasked with implementing the law and the Government schemes, cannot abdicate responsibility, raise their hands, deny legitimate relief or make parties run from pillar to post and ultimately the Courts to get their dues. The officials who handle technology must deal with matters with the sensitivity and intelligence that the situation requires.
The court while allowing the petition held that the DGFT shall not, again, hold the Petitioner ineligible on the ground that its systems are not geared up to fully take cognisance of the manual amendments to the shipping bills or on account of any other systemic or technical issues in the DGFT’s portals and system.
Case Details
Case Title: Larsen & Toubro Limited Versus The Union of India
Case No.: Writ Petition No. 3667 Of 2024
Date: 13/11/2024
Counsel For Petitioner: Prakash D. Shah
Counsel For Respondent: Shruti Vyas
