The Bombay High Court ruled in favor of Larsen & Toubro Limited (L&T) regarding the grant of benefits under the Merchandise Exports from India Scheme (MEIS). The Court directed the respondents, including the Directorate General of Foreign Trade (DGFT) and Customs Authorities, to issue MEIS Scrips to L&T, addressing the systemic challenges and technological lapses that had caused delays. The judgment emphasized the balance between leveraging technology and applying human discretion to prevent undue hardship to exporters.

Introduction and Relief Sought

1-3:

• Petitioner: Larsen & Toubro Limited.
• Respondents: Union of India, DGFT, Customs Authorities, and related officials.
• Relief: Direction to correct shipping bill errors and grant MEIS Scrips worth ₹1,61,34,190.

Background and Issue

4-6:

• Problem: Errors in shipping bills (incorrect flagging of MEIS claim as "N" instead of "Y") led to denial of benefits.
• Action Taken: Manual corrections permitted by Customs Authorities but not processed electronically due to system limitations.

Attempts to Resolve

7-14:

• Manual corrections were accepted by Customs Authorities in 2019.
• L&T repeatedly approached DGFT for rectification, but systemic issues persisted.
• Advisory (2023) and procedural changes were introduced but not effectively implemented.

Judicial Observations

15-24:

• The Court recognized systemic gaps and lack of integration between Customs and DGFT.
• Highlighted similar issues resolved in Technocraft Industries (India) Limited v. Union of India.
• Stressed the need for collaboration and updates in electronic systems.

Judgment and Directions

25-32:

• Directed DGFT to process the application and issue MEIS Scrips within 15 days.
• Mandated system upgrades to prevent recurrence of similar issues.
• Imposed costs of ₹50,000 on DGFT, to be donated to Tata Memorial Hospital.

Key Legal Provisions Discussed

• Section 149, Customs Act, 1962:
  Empowers Customs Authorities to amend documents, including shipping bills, for genuine errors.

• MEIS (Merchandise Exports from India Scheme):
  Incentive scheme under the Foreign Trade Policy 2015-2020 to promote exports.

Ratio Decidendi: 

1. Systemic Integration: The lack of coordination between DGFT and Customs cannot penalize eligible exporters.
2. Human Discretion in Technology-Driven Processes: Technology should facilitate, not hinder, the implementation of legal rights.
3. Access to Justice: Exporters should not be forced to seek judicial intervention for procedural inadequacies.

Subjects:

Administrative Law, Export Incentives, Technology in Governance.

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