2018 (3) TMI 287 - HC - Customs

Benefit under Advance Authorisation Scheme - advance authorisation contained a condition, by which the petitioner was obligated to export finished products within a specified time. The admitted fact is that the petitioner did not comply with the said condition within the time stipulated - Held that - the impugned orders in W.P.Nos.2304 and 2305 of 2018 though appear to grant relief to the petitioner have in fact denied the relief. While passing the impugned order, the second respondent has exercised his power and granted extension of time and further made a direction unworkable by stating that the direction will operate from 22.02.2014. Thus, the benefit granted in favour of the petitioner has ended in futility and the impugned order is a paper order, probably with a view to comply with the direction issued by this Court. The second respondent cannot be given an opportunity to revise his own order and he having not been vested with any such power to revise his own order under the relevant regulations, the question of remanding the matter does not arise. With regard to the period for which the extension has to be granted, the respondent should have taken a realistic approach, because, admittedly, the petitioner is yet to fulfil the export obligation. Therefore, to grant extension up to August 2014 is an unworkable order and probably would serve statistical purposes only. Therefore to that extent the impugned orders in W.P.Nos.2304 and 2305 of 2018 call for interference. Petition allowed in part.

Summary

Issues involved:
- Granting of extension for fulfilling export obligation under advance authorisation.
- Compliance with court directions regarding removal from denied entity list.

Analysis:

1. Extension for Export Obligation:
The petitioner, a Textile mill, was granted an advance authorisation to import raw materials with the obligation to re-export finished goods within a specified time. However, the petitioner failed to comply with the export condition within the stipulated time, leading to the withdrawal of benefits under the advance licence by respondents 1 to 3. The petitioner sought extension multiple times, citing reasons like locating a buyer and filed writ petitions challenging the denial of extension. The High Court directed the second respondent to consider the representations and grant an extension of time. However, the subsequent order granting extension from a past date was deemed unworkable and futile by the Court, leading to the petitioner filing further writ petitions.

2. Compliance with Court Directions:
The Court found that the second respondent's orders granting extension were ineffective as they operated from a date in the past, rendering the relief meaningless. The Senior Standing Counsel argued for a prospective extension and remand to reconsider eligibility, but the Court disagreed, stating that the second respondent had already decided on the extension period and had no power to revise the order. The Court emphasized the need for a realistic approach in granting extensions, especially considering the petitioner's pending export obligation. Additionally, the Court noted non-compliance with its earlier direction to refrain from coercive actions against the petitioner, leading to the petitioner's business activities being hampered. Consequently, the Court set aside the impugned orders and directed the removal of the petitioner's company from the denied entity list within a specified timeframe.

In conclusion, the High Court partially allowed the writ petitions related to the extension of time for fulfilling the export obligation and compliance with court directions regarding the denied entity list. The Court set aside the previous orders and directed the second respondent to grant a prospective extension from the date of the new order. The respondents were instructed to remove the petitioner's company from the denied entity list within three weeks from the date of the Court's order.