2006 (9) TMI 399 - HC - Indian Laws

Summary

Issues Involved:
The issues involved in the judgment are the entitlement to Cash Compensatory Support (CCS) benefits by a 100% Export Oriented Unit (EOU) and the subsequent demand for refund of excess amount paid u/s CCS scheme.

Entitlement to CCS Benefits:
The petitioner, a 100% Export Oriented Unit (EOU) manufacturing integrated circuits, claimed CCS benefits based on the notional FOB value of exports, including the cost of raw materials not paid for by the petitioner. The Ministry of Commerce extended the practice of notional FOB value to EPZ exports from 3-12-1990, but denied retrospective benefits. The petitioner filed a writ petition seeking retrospective payment of cash incentives from 14-4-1988. The Court directed the Ministry to reconsider the matter and pass a reasoned order.

Demand for Refund of Excess Amount:
The Development Commissioner, SEEPZ, Mumbai, directed the petitioner to refund an excess amount of Rs. 39,64,044 received against CCS claims for the period 1-4-1988 to 3-7-1991. The petitioner challenged this demand through a writ petition. Subsequently, a new order dated 28-10-2005 directed recovery of Rs. 23,65,251 towards excess payments made during the same period, replacing the earlier demand. The petitioner sought to amend the writ petition to challenge the new order.

Maintainability and Territorial Jurisdiction:
The respondent argued that the writ petition was not maintainable as the order was made under the Foreign Trade (Development and Regulation) Act, 1992, providing for an appeal process. The Court held that the petitioner had an effective statutory remedy available under Section 15 of the Act and dismissed the writ petition on grounds of maintainability. The Court clarified that the petitioner should exhaust the statutory remedy and, if still aggrieved, approach the High Court of Judicature at Mumbai for further relief due to the cause of action arising in Mumbai.

Conclusion:
The Court dismissed the writ petition on grounds of maintainability, emphasizing the availability of an effective statutory remedy under the Act. The Court declined to express an opinion on the merits of the case and directed the petitioner to exhaust the statutory appeal process before seeking further relief in the High Court of Judicature at Mumbai.