Calcutta High Court
Prateek Mines And Minerals Pvt Ltd ... vs Deputy Director General Of ... on 15 February, 2021
OD 5 WPO 69 of 2021
IN THE HIGH COURT AT CALCUTTA
CONSTITUTIONAL WRIT JURISDICTION
ORIGINAL SIDE
PRATEEK MINES AND MINERALS PVT LTD AND ANR
VERSUS
DEPUTY DIRECTOR GENERAL OF FOREIGN TRADE AND ORS
BEFORE:
The Hon'ble JUSTICE ARINDAM MUKHERJEE
Date: 15th February, 2021
APPEARANCE:
Mr. Abhrajit Mitra,Sr.Adv.
Mr. Agnivesh Sengupta,Adv.
Ms. Rajshree Kajaria,Adv.
Mr. Uttam Sharma,Adv.
Mr. Vipul Kundalia,Adv.
Ms. Sumitra Das,Adv.
The Court: Affidavits of service filed in Court today be kept on record.
2
The petitioner no. 1 held a EPCG licence dated 28th May, 2008 which
stipulated for export of a certain value of goods within a time-frame. The
petitioner no. 1 applied for fulfilling such exported obligation through its
group companies after having been unable to fulfil such exported
obligation by itself. Subsequently, the petitioner exported the entire value
of goods through itself and its group companies. The Foreign Trade
Development Officer, by a redemption letter dated 26th October, 2017
certified the fulfillment of the export obligation by the petitioner no. 1 and
its group companies. The petitioner no. 1 was also allowed to take the
corresponding benefit on fulfillment of such export obligation. All on a
sudden, according to the petitioner, the Foreign Trade Development Officer
on behalf of the Joint Director General, foreign trade issued a notice dated
19th August, 2019 intimating the petitioner no. 1 that during internal audit
it has been observed that the export obligation against the EPCG licence of
the petitioner No. 1 has been wrongly discharged with 100 per cent export
by its group companies which was not permissible beyond 1st April, 2008.
The petitioner no. 1 was therefor requested to pay the customs
duty/interest for the unfulfilled export obligation to the extent of 50 per
cent. The petitioner no. 1 made a representation against such notice and,
ultimately, on 1st January 2021 a show cause notice was issued under
Sections 9 and 11 of Foreign Trade Development Act, 1992 read with Rule
3
7 of the Foreign Trade (Regulation) Act, 1993. The petitioners have, inter
alia, challenged the notices dated 19th August, 2019 and 1st January, 2021
in the instant writ petition. The petitioners say that the said two notices
are without jurisdiction and bad in law. This Court according to the
petitioners in exercise of its writ jurisdiction should interfere with the said
two notices being without jurisdiction. The petitioners say that they are
apprehending coercive action as against the petitioner No. 1 in view of the
two notices respectively dated 19th August, 2019 and 1st January, 2021.
The petitioners in support of their contention that the notices are without
jurisdiction have relied upon a judgment reported in 2010 (260) ELT 78
(Delhi). In the case of the Commissioners of Customs vs. AIR Travel
Bureau Ltd. On behalf of the respondents the Foreign Trade Policy for the
period of 1st September, 2004 to 31st March, 2009 which came into effect
from 1st April, 2007 and the Foreign Trade Policy for the same period which
came into effect from 1st Apri, 2008 has been referred to. By referring to
clause 5.4 of the said two Foreign Trade Policies a distinction has been
pointed out between the said two policies. It is further submitted by the
respondents that the EPCG licence of the petitioner is governed by the
Foreign Trade Policy which came into effect from 1st April, 2008 since the
licence was dated 28th May, 2008. The respondents also submit that so far
as to the fulfilment of export obligation by the group company in excess of
50 % is concerned the petitioner has violated the provision under the
Foreign Trade Policy being effective from 1st April, 2008. This was detected
subsequently and, as such, the notice dated 19th August, 2019 was
initially issued and the show cause notice dated 1st January, 2021 was
issued considering the reply from the petitioners. On behalf of the
respondents it is further submitted that the question of taking coercive
steps at this stage does not arise as the matter is only at the stage of
issuance of the show cause notice which will culminate into an
adjudication order only after the adjudication is complete. Till such time
the question of taking any coercive step will not arise from the side of the
respondents.
After hearing the parties and considering the materials on record, I
find that the two notices respectively dated 19th August, 2019 and 1st
january, 2021 have been issued by the authorised officer. The interference
by Writ Court at the Show Cause stage can be made only on very limited
grounds. The matter being in adjudication stage and that the two notices
cannot be said to be without jurisdiction on face on record, I am not
inclined to interfere with the said two notices at this stage. The
adjudication pursuant to the Show Cause should be brought to a logical
conclusion. The petitioner shall cooperate with the adjudicating authority
in terms of the notice dated 1st January, 2021. The petitioners shall file
their reply to the said show cause notice dated 1st January, 2021 within a
period of three weeks from date, failing which the matter will be
adjudciated without the petitioners' reply. The entire exercise of
adjudication shall be completed by the concerned officer within a period of
five weeks from date.
Since no adjudication has been made by the respondents as yet and
that there has been no coercive steps taken since August 2019, it is
expected that there shall be no coercive action from the respondents as
against the petitioners till one week after the communication of the
adjudication order in terms of the show cause notice dated 1st January,
2021. Nothing further remains to be adjudicated in this writ petition and
the same is, accordingly, disposed of without any order as to costs.
Since I have not called for affidavits, the allegations contained in the
petition are deemed to have not been admitted by the respondents.
(ARINDAM MUKHERJEE, J.)
sp3/S.Chandra
