Jamnadas Madhavji & Co. vs The Union Of India (Uoi), The Joint ...
2002 Latest Caselaw 1361 Bom

JUDGMENT

J.P. Devadhar, J.

1. In these two writ petitions, the Petitioners have challenged the circular dated 13th July, 1987 issued by the Respondents, wherein the Cash Compensatory Support ("CCS" for short) on export of spices under brand name in packs of 1 Kg. or less weight has been reduced from 10% to 7% with retrospective effect from 1st July, 1986. The Petitioners have also challenged the circular dated 16th July, 1987 issued by the Respondents wherein the Exporters of spices were required to obtain registration of their brand names with the Spices Board to avail 10% CCS with effect from 16th July, 1987. Since the facts in both the petitions are similar, we have heard both the petitions together and have disposed of the same by this common judgment.

2. For the sake of convenience, we have dealt with the facts in Writ Petition No. 3600 of 1987 in this judgment. The facts relevant for the purpose of present petition are as follows :

The Petitioners are a registered export house and export all major/minor spices like black pepper, Cummin, Turmeric, Ginger, Fennell, Cardemom in consumer pack under their brand names JM, GEM. The Petitioners have been exporting the spices in consumer pack of 1 Kg. or less weight under their own brand name and have been claiming CCS at the rate applicable from time-to-time.

3. The Petitioners are registered exporters of Indian spices and Rice, even before coming into existence of the Spices Board. The Spices Board came into existence with effect from 20th February, 1987 by merging the Spices Export Promotion Council and Cardamom Board who were the Registration authorities for export of spices.

4. To encourage exports, the Respondents have been announcing various schemes in order to induce people to export goods from India. The said incentives are in the form of grant of import licence, CCS, duty drawback etc. As far as the export of spices is concerned, by a circular issued by the Ministry of Commerce on 30th June, 1986 the CCS on the export of spices was fixed at 10% of FOB value of the spices. It was expressly stated in the said circular that the rates shown therein would be applicable to the export made on or after 1st July, 1986 and would be in force upto 31st March, 1989.

5. However, by a circular dated 13th February, 1987 the Ministry of Commerce sought to restrict the CCS on export of spices at 7% with retrospective effect from 1st July, 1986. Thereafter, the Respondents issued another circular dated 16th July, 1987 wherein it was stated that only brand names of the spices registered with the Spices Board will be eligible for CCS at 10% and where-ever brand names are not so registered with the Spices Board, the CCS will be allowed at 5%. In the light of aforesaid circular dated 13th February, 1987, the Respondents started paying CCS on export of Spices at 7% after adjusting the differential amount of CCS of 3% (10% 7%) already paid to the Petitioners during the period 1st July, 1986 to 12th February, 1987. In the light of circular dated 16th July, 1987, the Respondents purported to grant CCS at 5% instead of 10% on spices exported by the Petitioners, on the ground that the brand name of the Petitioners has not been approved by the Spices Board. Challenging these action of the Respondents, the Petitioners have approached this Court by filing the present writ petition.

6. As regards the validity of the circular dated 13th February, 1987 is concerned, we have held in the case of Gandhi Sons and others V/s. Union of India reported in 2002(81) E.C.C.261, that the Respondents could not retrospectively amend the circular dated 30th June, 1986 so as to grant CCS at 7% from 1st July, 1986. By the said judgment, we had directed the Respondents to grant CCS at 10% on export of spices made during the period 1st July 1986 to 12th February, 1987 and grant CCS at 7% for the period 13th February, 1987 to 15th July, 1987. In the light of aforesaid decision in case of Gandhi Sons (Supra) which is squarely applicable to the facts of the present case, we hold that the Petitioners are entitled to CCS at the rate as stated in the said judgment.

7. As regards denial of CCS at 10% on the export of spices after 16th July, 1987, on the ground that the brand name is not registered with the Spices Board, Mr. Sheth, learned Counsel appearing on behalf of the Petitioners submitted that on a plain reading of circular dated 16th July, 1987 it was evident that CCS available would be at 10% from 16th July, 1987 subject to the approval of the brand name by the Spices Board. It was submitted that in the instant case since the brand names have been approved by the Spices Board subsequently, the Petitioners were entitled to CCS at the rate of 10% from 16th July, 1987. Mr. Sheth further referred to para 315 of the Import & Export Policy A.M. 1985-88 and contended that for grant of benefit, like REP licence, period of export is relevant criteria. It was submitted that since the exports were effected under the brand names which was duly registered, the Petitioners were entitled to CCS at the rate of 10% from 16th July, 1987.

8. Mr. Shah, learned Counsel appearing on behalf of the Respondents, on the other hand submitted, that as per circular dated 16th July, 1987, the CCS at the rate of 10% became available only on the registration of the brand name by the Spices Board and till it is registered, the CCS will be available only at 5%. Alternatively, Mr. Shah submitted that on registration of the brand name, the CCS at 10% could be claimed from the date of application made by the Petitioners seeking registration of their brand name with the Spices Board. It was submitted that since the Petitioners themselves in their affidavit in rejoinder have claimed CCS at 10% from the date of application for registration, they are not entitled to CCS at 10% from 16th July, 1987.

9. We have heard learned Counsel on both sides and perused the records placed before us. In the present case, the undisputed facts are that after 16th July 1987 circular, the Petitioners have applied for registration of their brand name with the Spices Board and the same has been duly registered with the Spices Board at a later date. The question that arises for consideration in these petitions, is, whether the CCS at 10% would be available on export of Spices effected from 16th July, 1987 or from the date of application for registration of their brand name or from the date of the registration of their brand by the Spices Board ?

10. On a plain reading of circular dated 16th July, 1987 (Exhibit - E) it is clear that on export of spices in consumer packets of 1 Kg. or less weight with the Spices Board would entitle the exporter to avail CCS at the rate of 10% from 16th July, 1987. The only requirement is that the exporter must get his brand name registered with the Spices Board. The said circular does not state that the registration of the brand name with the Spices Board is a condition precedent for grant of CCS at 10%. Para 3 of the circular dated 16th July, 1987 in fact states that as and when the brand name is registered with the Spices Board it will be treated as specified brand name for the purpose of grant of CCS at 10% on export of spices in consumer packs of 1Kg. or less weight. In other words, on the brand name of the Petitioner being registered with the Spices Board, the exports effected from 16th July, 1987 will be treated as specified brand name under circular dated 16th July, 1987 and will be entitled for CCS at the rate of 10%. This interpretation of ours is further fortified by para 4 of the said circular dated 16th July, 1987, wherein it is clearly stated that the decision of the Spices Board to register the brand names will be deemed to be "specified brand name" under the 16.7.1987 circular and will be applicable to exports of spices in consumer packs made from the date of issue of said circular viz. 16th July, 1987. In view of the above, we have no hesitation in holding that the export of spices after 16th July, 1987 under the brand name of the Petitioners, will entitle them to avail 10% even though their brand name is registered by the Spices Board subsequently.

11. The Petitioners have claimed CCS at the rate of 10% from 16th July, 1987 in their petition and merely because through inadvertence, in their affidavit in rejoinder, they have claimed CCS at the rate of 10% from the date of application of registration of their brand name, they cannot be deprived of their legitimate claim for CCS at the rate of 10% from 16th July, 1987. Under the circumstances, we hold that the Petitioners are entitled to CCS on export of spices at the rate of 10% from 16th July, 1987/

12. For all the aforesaid reasons, both petitions succeed. The Respondents are directed to compute CCS on export of spices effected by the Petitioners :

@ 10% from 01.07.1986 to 12.02.1987,

@ 7% from 13.02.1987 to 15.07.1987,

@ 10% from 16.07.1987 onwards, and after adjusting the amount of CCS already paid or deducted, pay the balance amount to the respective Petitioners within a period of three months from today.

13. Both the petition stands disposed of in above terms, with no order as to costs.