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Issues: Interpretation of Para 127 of the Handbook of Procedures regarding transferability of duty free licenses and the validity period calculation.
In this case, the petitioner sought a stay on the operation of sub-para (iii) of Para 2 of Circular No. 7/94 issued by the Deputy Director General of Foreign Trade concerning the transferable facility in terms of Para 127 of the Handbook of Procedures. The petitioner had obtained a duty-free license, which became transferable and was subsequently transferred to them. The issue at hand was the interpretation of Para 127(v) of the Handbook, which stated that licenses upon transfer shall be valid for the balance period of their validity or six months, whichever is more. The impugned circular dated 19-4-1994 seemed to substitute the date of transfer with the date of transferability for calculating the validity period, which would result in a shorter validity period for the license. The court noted that the term "date of transfer" in Para 127(v) could not be substituted by any other mode without proper amendment, especially if it affected the validity period of licenses. Consequently, the court stayed the operation of sub-clause (iii) of Para 2 of the circular, allowing the application in favor of the petitioner. The court clarified that its view was prima facie for the purpose of disposing of the stay application, indicating that further detailed consideration might be required in the future.
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