2022 (12) TMI 101 - HC - Customs

Rejection of application for grant of transferability in respect of Duty Free Import Authorisations (DFIA) - only pesticides that are physically incorporated in the export product can be imported - non-mentioning of supporting manufacturer - not providing technical characteristics, quality and specification of pesticides/insecticides in the shipping bills - HELD THAT - Taking into consideration the contents of the impugned orders in all these writ petitions rejecting the petitioners applications for grant of transferability in respect of Duty Free Import Authorisation (DFIA) in question which according to me are lacking sufficient reason and not dealt with and discussed the relevant legal contentions raised by the petitioners in these writ petitions and accordingly the impugned orders of rejection of the petitioners aforesaid applications for grant of DFIA in question are set aside. The matters are remanded back to the respondents/authority concerned to reconsider the aforesaid applications and pass reasoned and speaking orders in all the aforesaid applications after giving opportunity of hearing to the petitioners or their authorised representatives and petitioners will be entitled to urge before the respondents/authority concerned all the points raised in these writ petitions, within eight weeks from the date of communication of this order without granting any unnecessary adjournment to the parties. Petition allowed by way of remand.

Issues Involved:
1. Rejection of applications for transferability of Duty Free Import Authorisations (DFIA).
2. Alleged misdeclaration in applications.
3. Non-compliance with technical and procedural requirements.
4. Delay in decision-making by the authorities.
5. Validity of previous authorizations granted by mistake.

Issue-Wise Detailed Analysis:

1. Rejection of Applications for Transferability of DFIA:
The primary issue in the writ petition is the challenge against the rejection of applications for transferability of five Duty Free Import Authorisations (DFIA) by the Additional DGFT on March 28, 2013. The petitioner had applied for the transferability of these DFIAs between January 6, 2012, and August 16, 2012, under the provisions of the Foreign Trade Policy (FTP) 2009-2014 and the Handbook of Procedures (HBP) Volume I.

2. Alleged Misdeclaration in Applications:
The rejection was based on three main grounds. First, there was an alleged misdeclaration in the application form ANF4H, where the petitioner declared the CIF value of pesticides/insecticides to be 82.14% of the FOB value, which was considered a violation of the policy. The policy allowed the import of 0.01116 Kgs of pesticides per 1 Kg of raw cotton exported, and the petitioner's declaration was deemed excessive and misleading.

3. Non-compliance with Technical and Procedural Requirements:
The second ground for rejection was the failure to mention the details of the supporting manufacturer in the application, as required by paragraphs 4.1.3.4(a) and 4.2.2 of the FTP 2009-2014. The third ground was the non-mentioning of technical characteristics, quality, and specifications of the pesticides/insecticides in the shipping bills, as mandated by paragraph 4.32.2 of HBP Vol-I.

4. Delay in Decision-Making by the Authorities:
The petitioner argued that the applications for amendment and transferability were made between January 2012 and August 2012, but the authorities took an unduly long time to reject them in March 2013. The petitioner contended that once export obligations were fulfilled, the authorities were obligated to grant the request for transferability, and the delay was unjustified and whimsical.

5. Validity of Previous Authorizations Granted by Mistake:
The respondents justified the rejection by stating that similar rejections were made for other DFIAs and that the petitioner's claims were inconsistent with the policy. They also argued that the previous authorizations granted on October 19, 2011, and December 26, 2011, were mistakes and could not be used to claim estoppel or legitimate expectation for the current applications.

Court's Decision:
The court found that the impugned orders rejecting the applications lacked sufficient reasoning and did not adequately address the legal contentions raised by the petitioners. Consequently, the court set aside the rejection orders and remanded the matters back to the authorities for reconsideration. The authorities were directed to pass reasoned and speaking orders after giving the petitioners an opportunity for a hearing. The court emphasized that the reconsideration should be completed within eight weeks from the date of the order.

Conclusion:
The writ petitions were disposed of with the direction that the authorities reconsider the applications for transferability of the DFIAs, addressing all points raised by the petitioners and providing a reasoned decision. Urgent certified copies of the judgment were to be supplied to the parties upon compliance with requisite formalities.

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