2015 (1) TMI 165 - HC - Customs

Extension of period for fulfilling its export obligation - inclusion of an alternate export product - Held that - Additional DGFT granted extension in export obligation period for 18 months from the date of endorsement of the Licensing Authority, without composition fee and also permitted the appellant to fulfil the said export obligation by exporting goods other than Video Software . In accordance with the said order, an endorsement dated 13th September, 2007 was made to the licence, extending the period for fulfilling the export obligation for 18 months therefrom. - Though the order dated 8th June, 2006 (supra) permitted the appellant to fulfil the export obligation by exporting alternate product manufactured by the appellant or its group companies in terms of the provisions contained in para 5.4(i) of the Foreign Trade Policy but while making endorsement on the licence in terms of the said order, endorsement to the said effect was not made and which resulted in the appellant being not able to fulfil the export obligation by exporting alternate product. Challenge in the writ petition from which this appeal arises being to the refusal of extension but even otherwise is fallacious. In fact, we have enquired from the counsel for the appellant that even if that be so, what prejudice thereby has been caused to the appellant; what else could the appellant have said even if had been served with a fresh notice. The counsel for the appellant has fairly agreed that neither any prejudice has been caused to the appellant nor did the appellant make any attempt to export any alternate product - Decided against assesse.

Summary

Issues:
Challenge to rejection of extension of export obligation period and inclusion of alternate export product.

Analysis:
The case involved an intra-court appeal against the dismissal of a writ petition challenging the rejection of the appellant's request for an extension of the export obligation period and inclusion of an alternate export product. The appellant had been issued an Export Promotion Capital Goods Licence with a condition to export 'Video Software' within five years. Despite previous extensions granted, the appellant failed to fulfill the export obligation, leading to penalties. The Additional DGFT had allowed an appeal, granting an 18-month extension for fulfilling the obligation with an option to export goods other than 'Video Software.' The appellant still failed to meet the obligation, resulting in the rejection of further extension.

The learned Single Judge dismissed the writ petition, emphasizing the significant delay in fulfilling the export obligation and the lack of error in the rejection by the DGFT. The appellant's counsel raised two arguments in the appeal. Firstly, it was contended that the endorsement on the licence did not allow for the export of alternate products despite the order permitting it. However, the court found this argument misconceived as the endorsement clearly extended the export obligation period as per the order. Secondly, the appellant argued that the Adjudicating Authority did not provide a fresh notice for reconsideration. Although this issue was deemed irrelevant, the court found no prejudice caused to the appellant. The appellant had not attempted to export any alternate product nor faced any refusal in this regard.

Ultimately, the court found no merit in the appeal and dismissed it without imposing any costs. The judgment highlighted the appellant's failure to fulfill the export obligation over an extended period, leading to the rejection of further extensions. The court's decision was based on a thorough analysis of the arguments presented by the appellant's counsel and the lack of substantive grounds for challenging the rejection of extension and inclusion of alternate export products.