1985 (5) TMI 188 - HC - Customs

Issues Involved:
1. Non-granting and/or non-disposing of applications for permission to import carbon steel re-rollable scrap.
2. Compliance with Import Export Policy AM-1984 and Hand Book of Import Export Procedure AM-1984.
3. Obligations of MSTC and SAIL in supplying re-rollable scrap.
4. Petitioners' entitlement to direct import licenses.
5. Assessment and reassessment of petitioners' consumption capacity.

Detailed Analysis:

1. Non-granting and/or non-disposing of applications for permission to import carbon steel re-rollable scrap:
The petitioners challenged the non-granting and/or non-disposing of their applications for permission to import carbon steel re-rollable scrap. The applications were made in accordance with the Import Export Policy of AM-1984, specifically under para 73(2) and para 155(1) of the Hand Book of Import Export Procedure AM-1984. The petitioners had registered their requirements with MSTC but faced delays and lack of clarity in the supply process.

2. Compliance with Import Export Policy AM-1984 and Hand Book of Import Export Procedure AM-1984:
The judgment emphasizes the provisions of para 155(1) of the Hand Book of Import Export Procedure AM-1984, which mandates that the canalising agency must indicate within 90 days the arrangements for supply. If the agency fails to do so, the actual user may approach the CCI&E (Monitoring Committee) for direct imports. The judgment found that MSTC failed to comply with these provisions, leading to the petitioners' inability to procure the required raw material.

3. Obligations of MSTC and SAIL in supplying re-rollable scrap:
MSTC directed the petitioners to approach SAIL for their requirements. However, SAIL redirected them to AISRA, which expressed its inability to recommend any material allotment. Despite the petitioners completing all formalities, including opening a confirmed revolving L/C, no substantial supply was made. The judgment criticized MSTC and SAIL for not fulfilling their obligations and misleading the Monitoring Committee about their ability to supply the material.

4. Petitioners' entitlement to direct import licenses:
The judgment highlighted that the petitioners were entitled to direct import licenses due to the failure of MSTC and SAIL to supply the required material. The Monitoring Committee initially rejected the petitioners' request based on misleading information from SAIL. However, the judgment ordered that if the respondents cannot supply the material from indigenous sources, they must issue direct import licenses within two months after 90 days.

5. Assessment and reassessment of petitioners' consumption capacity:
The petitioners' consumption capacities were assessed by a Technical Committee appointed by the Central Government. The judgment noted that the respondents did not provide any evidence to contradict the petitioners' claimed capacities. The court allowed for the possibility of reassessment by a duly appointed Technical Committee, provided the petitioners are given an opportunity to be heard.

Conclusion:
The writ petitions were allowed, with the court directing the respondents to reassess the petitioners' consumption capacities if necessary and to make arrangements for supply within 90 days. If the supplies cannot be made from indigenous sources, direct import licenses must be issued. The court emphasized the importance of adhering to the provisions of the Import Export Policy and the Hand Book of Import Export Procedure to ensure the actual users are not deprived of necessary raw materials.

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