2024 (3) TMI 196 - HC - Customs

Validity of the Notification Prohibiting Export of Non-Basmati White Rice - Seeking directions to permit the export of non-basmati white rice for which shipping bills had been filed by the Petitioner and the rotation number had also been generated - Notification No. 20/2023 - purchase contracts executed by the petitioner prior to the Notification - HELD THAT - Admittedly, the case of the petitioner does not fall in any of the above sub-paragraphs (i) to (iv) of para 2 of the said Notification, meaning thereby, neither the loading of Non-Basmati White Rice on the ships commenced before the said Notification nor the ships already berthed or arrived at for the shipping bills filed by the petitioner nor the petitioner had handed over the consignments to the Customs before the said Notification nor any permission was granted by the Government of India to the other countries to meet their food security needs in the facts of the case. The aforesaid Notification No. 20/2023 was further explained by the Trade Notice No. 23/2023, whereby the DGFT, on receipt of the representations made from the Stakeholders including Customs Authorities clarified with regard to conditions (i), (ii), and (iii) of para 2 of the said Notification as to whether all the three conditions are independent of each other or exporter has to fulfill all the conditions together and for that, the clarification was issued that all the three conditions are independent of each other and export is allowed in case of completion of any one of the conditions of para 2 of the said Notification by the exporter. However, in the facts of the case, none of the conditions is fulfilled by the petitioner, and therefore, even the Notification No. 23/2023 would not be applicable to the facts of the case. The Hon ble Delhi High Court, in the case of VI Exports India Private Limited 2024 (1) TMI 647 - DELHI HIGH COURT , dealt with the similar issue as to the issuance of writ of mandamus to the respondent for permitting the petitioner to export the Non-Basmati White Rice under the said Notification No. 20/2023, dismissed the writ petition. We are in complete agreement with the reasons assigned by the Hon ble Delhi High Court, and therefore, in order to avoid duplication, the same are not reiterated., Thus, this petition petition is not entertained and is accordingly dismissed. Notice is discharged.

Issues Involved:
1. Whether the petitioner should be permitted to export Non-Basmati White Rice despite the Notification dated 20.07.2023 prohibiting such export.
2. Whether the petitioner's case falls under any exceptions provided in the Notification.
3. The applicability of the doctrine of legitimate expectation and substantial compliance.

Summary:

1. Permitting Export of Non-Basmati White Rice:
The petitioner sought relief to export 4232 MT of Non-Basmati White Rice, which was procured before the Notification dated 20.07.2023 by the Directorate General of Foreign Trade (DGFT) that prohibited such exports. The petitioner argued that the rice was already under purchase contracts and that the Notification retroactively impeded their ability to fulfill these contracts.

2. Exceptions in the Notification:
The Notification No. 20/2023 amended the Export Policy of Non-Basmati White Rice from "free" to "prohibited." It provided exceptions for exports if certain conditions were met, such as loading on the ship before the Notification, ships already berthed, or consignments handed over to Customs before the Notification. The petitioner did not meet any of these exceptions, as the rice was not loaded, the ships were not berthed, and the consignments were not handed over to Customs before the Notification.

3. Doctrine of Legitimate Expectation and Substantial Compliance:
The petitioner relied on previous court decisions to argue for the application of the doctrine of legitimate expectation, suggesting that the Notification should not retroactively affect their contracts. The petitioner also invoked the doctrine of substantial compliance, arguing that their efforts to export should be considered sufficient.

Respondent's Argument:
The respondent argued that the Notification was a policy decision aimed at controlling rising domestic prices and that the petitioner did not qualify for any exceptions. The respondent relied on the Delhi High Court's decision in VI Exports India Private Limited vs. Union of India, which upheld the Notification's prohibitions and emphasized strict compliance with its terms.

Court's Analysis and Conclusion:
The court referred to the Notification and its exceptions, confirming that the petitioner did not meet any of the conditions for exemption. The court also cited the Delhi High Court's decision, which dismissed a similar petition, emphasizing that policy decisions by the government should not be interfered with by the courts unless they violate constitutional principles. The court concluded that the petitioner's request for mandamus to compel the government to breach its own Notification could not be granted.

Final Judgment:
The petition was dismissed, and the court agreed with the reasoning of the Delhi High Court that no mandamus lies to compel the government to act contrary to its own Notification. The court emphasized the importance of strict compliance with the Notification and upheld the prohibition on the export of Non-Basmati White Rice.

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