Navin Fluorine International ... vs Union Of India (Uoi) And Anr.
2007 Latest Caselaw 2026 Del

JUDGMENT

S. Ravindra Bhat, J.

1. Issue notice. Mr. Rajeeve Mehra, learned Counsel accepts notice. With consent of counsel for the parties the petition was heard finally.

2. The petitioner claims directions for quashing of the decision dated 29.8.2007 and the order dated 14.6.2007 along with minutes of meeting dated 31.5.2007 issued by the first and second respondents. The petitioner is a manufacturer inter alia of BF3 gas which is apparently used for manufacture of life saving products. The raw material is Boric Acid.

3. According to provisions of the Insecticides Act Chemicals which are potentially used for manufacture of insecticides have to receive clearance for the purpose of import by a Board set up under the Act. In the case of such material which are used for non-insecticide purpose although there is no statutory requirement, the Government of India has evolved a mechanism by which a committee examines requests in deserving cases for import of such materials. This was set up pursuant to the circular/instructions issued in this regard by the Department of Agriculture, Ministry of Agriculture, on 1.8.2005. The said notification also has set up what is known as "Registration Committee" and "Central Insecticides Board". The petitioner claims that it was permitted to import Boric Acid on 26.9.2005 by the respondent of a quantity of 1100 MT. Similarly in 2006 it was permitted to import 300 MT. This was on the basis of recommendations of the Nodal Ministry i.e. Ministry of Agriculture. It is alleged that subsequently the Nodal Ministry was changed; it now is the Ministry of Chemicals and Pharmaceuticals. On 19.2.2007 the said Nodel Ministry permitted the petitioner to import 900 MT of Boric Acid.

4. The complaint in these proceedings is that sometime in February, 2007 the Directorate General of Central Excise Intelligence (DGCEI) visited the petitioner's premises; this led to issuance of a show cause notice. The DGCEI's position was that permission to import given to the petitioner had been withdrawn and therefore it was illegally importing Boric Acid and manufacturing the product in question i.e. BF3 gas. In view of this, the impugned orders were made, rejecting the petitioner's request for further import. The petitioner therefore preferred an appeal to the Appellate Authority i.e. the Joint Secretary, Government of India, Department of Agriculture. By its order dated 29.8.2007 the said Appellate Authority rejected the appeal. The operative part of the order reads as follows:

The arguments and written statements submitted by both the parties were examined and conclude that the Registration Committee has not denied the import permit to the appellant. The Registration Committee has sought for a 'No Objection Certificate' from the DG. CEI for a variety of reasons, as brought out by the Secretary, CIBRC. Therefore, the contention of the appellant that the Registration Committee has no jurisdiction to seek such 'No Objection Certificate' is not valid as the appellant himself has not denied the import of Boric Acid without valid import permit nor provided information contrary to the above argument. Under the above circumstance, the appellant has no case and is advised to produce the 'No Objection 'Certificate' from the DG, CEI for a final decision by the Registration Committee. Therefore, the appeal is rejected and order accordingly.

5. It is contended by Mr. S. Ganesh, learned senior Counsel that the impugned orders cannot be sustained because the entire premise of the authorities is that the permission initially granted in 2005 was withdrawn. He submitted that till date no order has been served on the petitioners in that regard nor the reasons for such orders, indicated. Learned Counsel also contended that a decision was taken behind the petitioner's back without issuing a show cause notice or granting any much less reasonable opportunity of being heard. Counsel contended that having regard to the previous history i.e. the petitioner being permitted to import the subject goods all this while, and even the subsequent clearances in 2006 as well as in 2007 the authorities could not unilaterally taken the view that the pendency of proceedings pursuant to show cause notice DGCEI was an impediment for importing the material.

6. Learned Counsel submitted that the mechanism evolved by the respondents i.e. the Registration Committee is itself without statutory cover and the further requirement of having to obtain no objection certificate from an authority which has no control i.e. DGCEI is affecting its rights to carry on business and illegal and without authority of law.

7. Learned Counsel for the respondent Mr. Mehra urged that the petitioner acted upon the order of the Appellate Authority and approached the DGCEI on 9.10.2007 seeking a no objection from its office. In view of this it was not open to the petitioner to find fault with the order of the Appellate Authority and the order dated 31.5.2007 by the Registration Committee declining the permit. Learned Counsel contended that the matter is still under investigation and all that can be done is to direct the DGCEI to expedite the process and indicate its response vis-a-vis no objection sought.

8. It is evident from the above discussion that the petitioner has been regularly importing the product i.e. Boric Acid. It is claimed that the said product is used to manufacture BF3 gas, which is in turn used in the pharmaceuticals industry. Apart from the fact that the letter dated 28.9.2005 expressly permitted import of 1011 MT of Boric Acid, the subsequent order dated 25.5.2006 by the Central Insecticides Board shows that further permission was granted for importing 300 MT of Boric Acid. Yet again, on 19.2.2007 the Department of Chemicals and Petro-Chemicals after considering all the materials again permitted importation of 952 MT of Boric Acid for non-insecticidal use for the manufacture of Boron Trifluoride (BF3) for the year 2007. In other words the concerned authorities i.e. the Ministry of Agriculture for the year 2005-06 and the Ministry of Chemicals and Fertilizers for the year 2007 were satisfied that the claims of the petitioner and permitted importation. In these circumstances the petitioner's claim that the authorities overlooked material facts and blindly went by the show cause notice issued by the DGCEI, appears to be well founded. In any case consideration of the Appellate order would show that the Appellate Authority did not apply its mind to the facts of the case.

9. The petitioner had relied upon another order passed by the same Appellate Authority i.e. Joint Secretary, Government of India on 15.12.2006 in Appeal No. 3/2006 of M/s Futura Ceramics Pvt. Ltd. There too, like in the case of petitioner the Registration Committee had turned down the request for a permit. The Appellate Authority agreed with the contention that once the Nodal or Administrative Ministry had granted permission, there was no question of declining the request for permit. The relevant part of that order, a copy of which has been produced along with the writ petition, reads as follows:

I, however, agree with the view of the Appellant that the RC should not re-examine the recommendation of the nodal/administrative Ministry/Department, either in regard to its rationale & justification or in regard to the quantification of import requirement. The whole purpose of obtaining the views/advice of the nodal/administrative Ministry/Department is to bring on board the opinion of the experts, which should not be challenged or questioned in the RC, especially when the RC does not possess the technical competence & expertise in these fields. Neither should the RC arbitrarily issue import permits in installments thereby causing undue inconvenience, additional work & delays, not only to the appellants but also to their own Secretariat who would be better utilized to improve the efficiency of disposal of pesticide registrations.

I, therefore admit the appeal and direct the RC to issue import permit in favor of the appellant allowing him to import the balance quantity of 600 MT boric acid for the remaining part of the financial year.

The Registration Committee is also directed to accept, in toto, the advice of the nodal/administrative Ministries/Departments in respect of the rationale, jurisdiction & quantity of insecticides to be imported for non-insecticidal use of issue import permit for the entire recommended quantity at one go instead of breaking it up into installments.

10. In the light of the above I am of the opinion that the Appellate authority should reconsider the petitioner's appeal i.e. Appeal No. 9/2007, having regard to the contentions noticed above, particularly directing its mind to the fact that clearance had been granted for 2006 as well as in 2007, and also in the light of its previous order in Futura Ceramics Pvt. Ltd. A speaking order dealing with all contentions including the above aspects shall be passed within two weeks of receipt of this order after considering views of all the concerned parties. All rights and contentions of the parties are hereby kept reserved.

Order dusty.