2019 (5) TMI 831 - HC - Customs

Defaulter Order - Rule 7 of Foreign Trade (Development Regulations) Act, 1992 - HELD THAT - The Additional Director General of Foreign Trade, Ministry of Commerce and Industry, being the respondent no.2 in the instant application, to consider the application made by the petitioners on 2nd January, 2019 and pass necessary orders within a period of two weeks from the date of communication of this order by the petitioners to the respondent no.2. The respondent no.2 will give an opportunity of hearing to the petitioners, consider the submissions made by the petitioner and pass a reasoned order in the light of the submission made by the learned Advocate appearing for the respondent no.2 that there is no order of stay in respect of the order dated 14th March, 2012 and that the petitioners are suffering a deterrent action under the Foreign Trade (Development Regulation) Act, 1992 for last six years without any reason whatsoever. Petition disposed off.

Summary

Issues:
Challenge to order dated 29th May, 2012; Non-consideration of representations by respondent authority; Pending appeal before CESTAT against order dated 14th March, 2012; Lack of stay against the order dated 14th March, 2012; Relief sought by petitioners.

Analysis:
The petitioners challenged the order dated 29th May, 2012, issued by the Deputy Director General of Foreign Trade, declaring the petitioner firm a defaulter under Rule 7 of the Foreign Trade (Development & Regulations) Act, 1992. This challenge stemmed from the fact that all proceedings initiated by the Directorate of Revenue Intelligence had been dropped by an adjudication order dated 14th March, 2012, by the Commissioner of Customs. The petitioners sought the quashing of the order dated 29th May, 2012, due to this discrepancy.

The petitioners contended that despite making several representations before the Additional Director General of Foreign Trade, the respondent authority, none of their representations were considered. The last representation was made on 2nd January, 2019, which further fueled the challenge against the order dated 29th May, 2012. The failure to address these representations added to the basis for seeking relief through the legal process.

The respondent authority highlighted that an appeal had been filed by the Directorate of Revenue Intelligence, Kolkata, against the order dated 14th March, 2012, which was pending before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). Additionally, it was clarified that no stay had been granted by the CESTAT against the order dated 14th March, 2012, up to the date of the court proceedings. This information was crucial in understanding the legal landscape surrounding the case.

In light of the above arguments and clarifications, the High Court directed the Additional Director General of Foreign Trade to consider the application made by the petitioners on 2nd January, 2019, within a period of two weeks from the communication of the court's order. The respondent authority was instructed to provide the petitioners with an opportunity for a hearing, consider their submissions, and issue a reasoned order. The court emphasized the need for a fair review, especially given the absence of a stay against the order dated 14th March, 2012, and the prolonged adverse impact on the petitioners under the Foreign Trade (Development & Regulation) Act, 1992.

The writ petition (W.P. No.56 of 2019) was disposed of by the High Court, with no order as to costs. The parties were advised to apply for an urgent xerox certified copy of the order if required, upon complying with the usual undertakings.