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Issues Involved:
1. Whether the time granted to accomplish the export obligation is deemed to have been extended by virtue of the public notification issued by the Government of India on April 6, 1999. 2. Whether the invocation and enforcement of bank guarantees consequent to non-fulfilment of export obligation under EPCG licence is barred or suspended by virtue of the pending proceedings under the SICA. Detailed Analysis: Issue 1: Extension of Time to Accomplish Export Obligation The petitioner-company sought to avail the benefits of the EPCG Scheme, which required fulfilling export obligations within a stipulated period. Due to financial difficulties, the petitioner moved the BIFR under the Sick Industrial Companies (Special Provisions) Act, 1985. The petitioner argued that the public notification issued on April 6, 1999, by the Government of India extended the period to fulfill the export obligation until March 31, 2002. However, the court found that the petitioner had not complied with the conditions stipulated in the public notice, which required the submission of a bank guarantee covering customs duty and interest. The petitioner failed to meet these requirements, and thus, no extension was granted. The court concluded that there could be no automatic extension of the period to discharge the export obligation, and the first point was decided against the petitioner. Issue 2: Invocation of Bank Guarantees and SICA The petitioner contended that the invocation of bank guarantees during the pendency of proceedings under the SICA was impermissible without the leave of the BIFR. The court examined whether the guarantees could be invoked under section 22 of the SICA, which suspends certain legal proceedings against a sick industrial company. The court noted that the bank guarantees were not related to a loan or advance but were furnished to comply with the conditions of the EPCG Scheme, allowing duty-free import of capital goods. The failure to fulfill the export obligation led to the invocation of the guarantees. The court held that the invocation of bank guarantees did not fall under the ambit of section 22 of the SICA, as it was not a loan transaction or an advance. The enforcement of bank guarantees was a distinct obligation arising from the import-export policy and did not constitute a liability that could be suspended under section 22. The court emphasized that the language of the statute must be read as it is, without addition or subtraction of words. The court concluded that the petitioner's liability to honor the bank guarantees was not suspended by the SICA, and the petitioner was not entitled to any relief. Conclusion: The writ petition was dismissed, and the court held that the petitioner was not entitled to the relief of mandamus. The invocation of bank guarantees was justified, and the petitioner had failed to comply with the conditions for an extension of the export obligation period. The enforcement of bank guarantees did not fall under the suspension provisions of the SICA.
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