Delhi High Court
Bahubali Exports (India) And Anr. vs Joint Director General Foreign ... on 4 December, 2001
Equivalent citations: 2002 IIIAD Delhi 970, 2002 (143) ELT 54 Del
Author: M Mudgal
Bench: M Mudgal
JUDGMENT
Mukul Mudgal, J.
1. Rule.
2. With the consent of the parties, the matter is taken up
today for final hearing.
3. This writ petition challenges the denial of the benefit
to the petitioner of Clause 66 of the Export-Import Policy
1992-97 which reads as follows:
"Exports/supplies made from the
date of receipt of an application under
this scheme by the licensing authority
may be accepted towards discharge of
export obligation. If the application
is approved, the license shall be
issued based on the input/output and
value addition norms in force on the
date of receipt of the application by
the licensing authority in proportion
to the provisional exports already made
till any amendment in the norms is
notified. For the remainder of the
exports, the Policy/Procedure in force
on the date of the issue of the license
shall be applicable. The conversion of
duty free shipping bills to drawback
shipping bills may also be permitted by
the Customs authorities in case the
application is rejected or modified by
the licensing authority. The exports/
supplies made in anticipation of the
grant of a duty free license shall be
entirely on the risk and responsibility
of the exporter."
2. The case set out in the writ petition is:
That the petitioner made an application for the grant
of Advance license under the Value Based Advance license
Scheme (hereinafter) referred to as the 'VABAL') on 18th of
March, 1997. On 21st of March, 1997, the application was
approved and sent for processing and on 22nd of March,
1997, the electronic goods were exported by the petitioner
entitling it to Value Based Free license in the sum of US $
28,545. The customs clearance was obtained on 28th of
March, 1997 and the goods were dispatched on 29th of March,
1997.
3. One of the significant pleas in the writ petition is at
Para 11 of the petition which reads as under:
"That it is submitted that the said
application of the petitioner was
approved by the respondent No. 1 on 21st
March, 1997 and the directions were
issued for proceeding the grant of
value based license to the petitioner.'
4. The said averment was rebutted by the respondents in
their counter affidavit in the following terms:
"The contents of Para 11 of the
Petition are wrong and denied as the
same are incorrect information."
Thus it is clear that there is no categorical denial
of the petitioner's plea that the application of the
petitioner was approved by the respondent No. 1 on 21st of
March, 1997. However, without going into the veracity of
the above, the petitioner's case purely turns on the
interpretation of Clause 66 of the Policy.
4. Mr. Malhotra, the learned counsel for the petitioner
has submitted that the phrase "If the application is
approved, the license shall be issued based on the
input/output and value addition norms in force on the date
of receipt of the application" entitled it to avail of the
value addition norms in force on the date of the receipt of
the application irrespective of the date of the approval
and it is indeed a vested right in the export license
granted by the said policy. He submits that since there is
no rejection of the petitioner's application whatever be
the date of the approval, the petitioner is entitled to
invoke the input/output and value addition norms in force
on 18th of March, 1997. It appears that there was a change
of policy on 1st of April, 1997 and the changed policy did
not grant the Value Based Advance license and only approved
the Quantity Based Advance license or duty drawback.
5. Ms. Pratibha M. Singh, the learned counsel, appearing
for the respondents, however, has submitted that the
petitioner had two option as per the Policy Circular dated
1st of April, 1997, the Para 3 of which reads as under:
"However, in respect of pending
applications filed before 1.4.97 for
issuance of Value Based Advance license
where such licenses have not been
issued before 1.4.97, the applicant
shall have the option to convert their
application into Advance license in
accordance with the Exim Policy
1997-2002 and the Handbook of
Procedures (Vol. 1) and (Vol. 2)
1997-2002. Such application shall be
considered by the licensing authority
without calling for the application
afresh in terms of Handbook of
Procedures (Vol. 1) 1997-2002.
Alternatively, the applicant in such
pending cases, shall also have the
option to claim drawback in lieu of
issuance of advance license under Exim
Policy 1997-2002."
Thus according to the learned counsel for the
respondents, the petitioner was entitled to have option
of either claiming drawback in lieu of issue of Value Based
Advance license under the Exim Policy 1997-2002 or convert
its application into Quantity Based Advance license.
6. She further submitted that the petitioner was entitled
to avail of any of these options which it is not seeking in
the present writ petition and only seeks a mandamus for
issuance of Value Based Advance license in terms of its
application dated 18th March, 1997. She has also relied
upon Para 66 of the Exim Policy of the year 1992-97 to
submit that if there is no approval, there cannot be any
grant of license and the Policy clearly implies that
exports undertaken in such a situation are at the risk of
exporter in the event of the approval not forthcoming. She
further relies upon Clause 7.14 of the Exim Policy of the
year 1997-2002 to contend that export obligation has to be
fulfilled within a period of 18 months which Clause clearly
shows that approval means that it is only from the date of
the grant of license.
7. The primary issue which arises in the writ petition is
the interpretation of Clause 66 of the Policy by the
respondents. The respondents' case seems to be that with
effect from 1st of April, 1997, the petitioner was not
entitled to invoke the earlier norms and was governed by
the norms applicable from 1st of April, 1997. In my view,
considering the Clause 66 and in particular the saving of
the applicable norms with reference to the date of the
application, the said interpretation does not represent the
correct position of law. The petitioner is entitled to
invoke the input/output and value addition norms in force
on the date of the receipt of the application, subject to
the approval of the application whatever the date of the
approval and in fact that is the precise purpose of Clause
66. Furthermore considering the averments in paragraph 3
of the writ petition and its reply in the counter
affidavit, the petitioner has demonstrated that its
application under Clause 66 was approved.
8. In this view of the matter, the stand taken by the
respondents, in so far as it rejects the petitioner's
application for issuance of Value Based Advance license on
the basis of the norms which came into force on 1st of
April, 1997 cannot be countenanced by the provisions of
Clause 66. Accordingly, the writ petition is entitled to
succeed and is thus allowed, directing the respondents to
process the application of the petitioner for approval in
accordance with law and Clause 66 which states that in case
the petitioner's application is approved, it shall be
entitled to invoke the provisions of Clause 66 for issuance
of a Value Based Advance license on the input/output and
value addition norms in force on the date of receipt of the
application, i.e., 18th of March, 1997. The petitioner's
application be processed within a period of eight week's
from the date of receipt of this judgment.
9. In view of the above, the writ petition stands allowed
as indicated above with no orders as to costs.
