2022 (8) TMI 338 - HC - Customs

Duty Free Entitlement Scheme - re-validation of the licence as well as bond waiver - duty free import of the goods as per the given norms applicable on the date of issue of licence - Application was rejected - Validity of Single Judge order of HC allowed the appeal of respondent - HELD THAT - This court is of the opinion that when there is specific instruction by way of executive order, to satisfy the requirement pertaining to reduction of quantity of vitamin mixes, the same cannot be slightly brushed by the learned Judge by observing that there is no requirement to furnish individual consumption details of vitamin mixes, as per the import export policy for 1992-97. The appellant authorities have been all along instructing the first respondent to furnish the consumption details relating to reduction of quantity of vitamin mixes, on the basis of the circular dated 21.01.1999. Since the first respondent failed to comply with the said requirement, their request for revalidation was rejected by the appellant authorities - in view of the settled law that when the authorities are having sufficient reasons to have such a policy decision to impose certain conditions in the circular, power of judicial review would not extend to determine the correctness of such a decision. It has been repeatedly held that courts will not ordinarily interfere with such decisions, when the same are taken in the public interest. Thus, in the absence of consumption details relating to vitamin mixes, as required in the circular issued by the appellant authorities, the request of the first respondent seeking revalidation could not be acceded to; and that, there is no provision in the current foreign trade policy to allow a revalidation of licence pertaining to the period of 1996 and 1997, this court cannot compel the appellant authorities to revalidate the licences of the first respondent - appeal allowed.

Issues Involved:
1. Revalidation of Advance Licences beyond 30 months.
2. Requirement of consumption details of vitamin mixes.
3. Compliance with the circular dated 21.01.1999.
4. Judicial review of policy decisions.

Issue-wise Detailed Analysis:

1. Revalidation of Advance Licences beyond 30 months:
The first respondent sought revalidation of their advance licences beyond the period of 30 months. The appellants argued that there is no provision for revalidation beyond 30 months from the date of issue of licences. The learned Judge initially allowed the writ petitions and directed the appellants to revalidate the licences. However, the appellants contended that the revalidation was not permissible as per the current Foreign Trade Policy and was not a matter of right. The Policy Relaxation Committee also rejected the request for revalidation, noting that the authorizations pertained to the period of 1996 and 1997 and there was no merit to revalidate them at this distance of time.

2. Requirement of consumption details of vitamin mixes:
The appellants rejected the revalidation requests due to the first respondent's failure to furnish consumption details of vitamin mixes as required by the circular dated 21.01.1999. The first respondent argued that they had fulfilled all export obligations and there was no need to provide such details. The learned Judge initially found that the demand for consumption particulars was without jurisdiction. However, the appellants maintained that the details were necessary for compliance with the policy guidelines.

3. Compliance with the circular dated 21.01.1999:
The circular issued by the Ministry of Commerce required the reduction of the quantity of vitamin mixes from 227 kg to 27 kg for revalidation of licences. The first respondent did not comply with this requirement, leading to the rejection of their revalidation requests. The appellants argued that the circular was binding and necessary for the revalidation process. The learned Judge initially disregarded the circular, but the appellate court emphasized its importance and the need for compliance.

4. Judicial review of policy decisions:
The appellants argued that the decisions of the Advance Licensing Committee and the Policy Relaxation Committee, based on the circular and policy guidelines, should not be interfered with by the court. The appellate court agreed, stating that judicial review should not extend to determining the correctness of policy decisions taken in public interest, provided they are not arbitrary or irrational. The court referred to several Supreme Court judgments to support this view, emphasizing that courts should respect executive decisions within the bounds of Article 14 of the Constitution.

Conclusion:
The appellate court set aside the learned Judge's order allowing the writ petitions and directed the appellants to revalidate the licences. The court upheld the appellants' arguments regarding the lack of provision for revalidation beyond 30 months, the necessity of consumption details of vitamin mixes, compliance with the circular dated 21.01.1999, and the limited scope of judicial review in policy matters. The appeals were allowed, and the rejection orders passed by the appellant authorities were reinstated.

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