Application of Section 69 and Chapter X to Shipstores [Section 88]:

This section provides that the provisions of Section 69 and chapter X shall apply to stores other than those covered by section 90. Thus it follows that,

(i) Section 69 allows warehoused goods to be exported without payment of import duty. By virtue of section 88, this benefit as available to warehoused goods if they are taken on board any foreign going vessel or aircraft as stores.

(ii) Further, as per section 74, where duty paid imported goods are exported within two years then subject to certain conditions, such duty shall be repaid as drawback. By virtue of section 88, this benefit has been made available to imported shipstores.

In case of imported shipstores, which have been re-exported after the import duties for the same have been paid, the original import duty paid is eligible as drawback. However a special provision has been made in this regard for stores like fuel and lubricants oil taken on board any foreign going aircraft whereby the whole of the import duty paid is eligible as drawback as against 98% eligible for other imported goods.

In case of M.J. Exports Ltd. v. CEGAT 1992 (60) E.L.T. 161 (S.C.), the Supreme Court held that the imported goods can be exported without clearing it for home consumption on payment of duty from the warehouse under Section 69.