2016 (2) TMI 1350 - HC - Customs

Notification dated 13th May, 2013 - power to fix a rate without any power to revise - prohibited goods - whether the revision effected by the impugned notification dated 13th May, 2013 from ₹ 75/- to ₹ 110/- was valid in law? - HELD THAT - If the Central Government was authorised to fix the value at ₹ 75/- then they were also authorised to revise it. Power to fix a rate without any power to revise the same does not amount to any power, to fix the rates, any more than there can be a power to appoint without a corresponding power to dismiss. The learned Trial Court has held the DGFT functions as a limb of the Central Government and not as a delegatee and mere non-mentioning of the specific source of power does not invalidate the entire executive action. Having done so it could not have been held that the impugned notification was not an act of the Central Government under section 5 of the Foreign Trade (Development and Regulation) Act, 1992. Reliance placed by the learned Trial Court upon paragraph 2.6 of the Foreign Trade Policy, quoted above, is altogether misplaced for the simple reason that the impugned policy, at page 104 of the Paper Book, is deemed to have been issued by the Central Government which is the policy making body whereas DGFT, in para 2.6 of the Foreign Trade Policy, is a mere implementing authority. Any restrain on the power of implementing authority cannot be treated also as a restrain or limitation on the power of Central Government. Therefore, both the grounds assigned by the learned Trial Court are without any merit and therefore cannot be sustained. The proper order shall be to set aside the order as regards the legality of the aforesaid notification dated 13th May, 2013 and to remand the matter for re-hearing on all the points pertaining thereto agitated by the writ petitioners - the writ petition is remanded for re-hearing except as regards the validity of the Customs notification which has attained finality. Petition allowed by way of remand.

Summary

Issues Involved:
Challenge to a notification under the Foreign Trade (Development and Regulation) Act, 1992 regarding the revision of import rates from Rs. 75/- to Rs. 110/- per kg.

Analysis:
1. Grounds of the Writ Petition:
The writ petition challenged a notification dated 13th May, 2013, issued by the Central Government under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992. The trial court allowed the petition on the grounds that the notification could have been published as an Order in the Official Gazette and that the Directorate General of Foreign Trade (DGFT) did not have the authority to revise rates as a condition for import.

2. Validity of the Notification:
The High Court disagreed with the trial court's reasoning. It emphasized that the Act is for both development and regulation of foreign trade, and regulations are essential for planned development. The power to revise rates was considered valid as the Central Government, being the policy-making body, had the authority to fix and revise rates. The court noted that the DGFT acts as a limb of the Central Government and not merely as a delegatee, and thus, the notification was within the purview of the Central Government's powers under the Act.

3. Remand for Re-Hearing:
The court acknowledged additional grounds raised in the writ petition regarding the irrationality of the policy and its impact on the country's interests. It was observed that these points were not adequately considered by the trial court. Therefore, the High Court set aside the previous order and remanded the matter for re-hearing on all relevant points raised by the petitioners.

4. Applications for Leave to Appeal and Addition as a Party:
Two separate applications were addressed by the court. The application for leave to appeal by a party not involved in the writ petition was dismissed, as the applicant was not a party to the original case. Similarly, the application for addition as a party respondent to the appeal was also dismissed, as no sufficient reason was found to allow the addition.

In conclusion, the High Court's judgment overturned the trial court's decision regarding the validity of the notification under the Foreign Trade (Development and Regulation) Act, 1992. The matter was remanded for re-hearing on all pertinent points raised in the writ petition, emphasizing the Central Government's authority to fix and revise import rates.