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2002 (5) TMI 388 - HC - FEMA

Issues Involved:
1. Validity and renewal of permits under the Maritime Zones of India (Regulation of Fishing by Foreign Vessels) Act, 1981 and Rules, 1982.
2. Distinction between chartered and leased vehicles.
3. Alleged policy decision and its adherence to the statutory provisions.
4. Application of principles of natural justice in the renewal of permits.
5. Legitimate expectation and promissory estoppel in the context of permit renewal.
6. Binding precedent and applicability of previous judgments.

Issue-wise Detailed Analysis:

1. Validity and Renewal of Permits:
The appellants, companies incorporated under the Companies Act, applied for and were granted permits under the Maritime Zones of India (Regulation of Fishing by Foreign Vessels) Act, 1981 and the corresponding Rules of 1982. The permits, initially granted for five years, were alleged to be valid for a total period of 15 years as per the guidelines and policy issued by the Government of India. The appellants contended that the five-year permits were meant to assess the efficacy of the grant and were to be extended automatically unless conditions were breached. The respondents, however, did not renew the permits, which led to the legal dispute.

2. Distinction Between Chartered and Leased Vehicles:
The appellants argued that there is a clear distinction between chartered and leased vehicles. While chartered vehicles have a fixed permit period of five years, leased vehicles can have permits extended up to 15 years. This distinction was supported by the amendment to Rule 7 of the said Rules, which specifies different validity periods for chartered and leased vehicles.

3. Alleged Policy Decision and its Adherence to Statutory Provisions:
The respondents claimed that the non-renewal of permits was due to a change in government policy, citing a previous Division Bench judgment in M/s. Golden Ahar Ltd. v. Union of India. The appellants countered that the policy decision was contrary to the provisions of the Act and the Rules. The court noted that policy decisions must align with statutory provisions and cannot override them. The respondents' contention of a bona fide mistake in filling up the permit form was also rejected, as any such mistake should have been rectified following the principles of natural justice.

4. Application of Principles of Natural Justice:
The court emphasized that the principles of natural justice must be more rigorously applied in the renewal of permits than in their initial grant. Renewal of a permit is a valuable right and can only be refused on cogent and valid grounds. The competent authority must act fairly, reasonably, and equitably, providing an opportunity for the appellants to be heard. The court cited several precedents to underline the importance of adhering to natural justice principles in administrative decisions affecting rights and interests.

5. Legitimate Expectation and Promissory Estoppel:
The appellants had a legitimate expectation that their permits would be renewed based on the initial indication that the vessels could operate for 15 years. The court held that a policy decision contrary to the statute cannot be upheld and that public interest must be demonstrated to override legitimate expectations. The appellants argued that similar permits had been renewed for others, indicating potential discrimination.

6. Binding Precedent and Applicability of Previous Judgments:
The court distinguished the present case from the M/s. Golden Ahar Ltd. judgment, noting that the previous decision did not consider the amendment to Rule 7, which differentiates between chartered and leased vehicles. The court reiterated that decisions must be read in context and that precedents are binding only on the issues directly addressed and decided.

Conclusion:
The court directed the respondents to consider the appellants' applications for renewal of permits expeditiously and in accordance with the law, emphasizing the need for fair and reasoned decisions. The appeals were allowed in part, with no order as to costs.

 

 

 

 

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