2023 (2) TMI 680 - HC - Customs

Non-issuance of Advance Authorization - import of Gold bars and export of manufactured Gold Jewellery and Gold Medallions by the Petitioner - party to the writ petition or not - rejection to issue Advance Authorization License on the ground that Advance Authorization would not be issued where the items for export were Gold Medallions and Coins or Any other jewellery/articles manufactured by a fully mechanized process. Rejection on the ground that the Petitioner was not a party to the writ petition which led to the decision of the Ld. Division Bench in M.D. OVERSEAS LIMITED VERSUS UNION OF INDIA AND ORS. 2020 (6) TMI 140 - DELHI HIGH COURT - HELD THAT - This ground would be completely untenable inasmuch as the public notice which was under challenge was the identical public notice which was the basis of the Petitioner s rejection. The said public notice upon being quashed, any action taken consequential to the said public notice, would also not stand in the eyes of law. The ld. Division Bench s judgment would squarely apply to the facts of the Petitioner s case as well. A quashed public notice cannot be relied upon by the department to refuse the Advance Authorization. Retrospective application of the notification dated 10th August, 2020 - HELD THAT - The Advance Authorization of the Petitioner was applied for on 26th June, 2019 and the same would have to therefore, be considered in terms of the legal position prevalent on the said date. The subsequent notification cannot be applied retrospectively to reject the said Advance Authorisation. The rejection of the Advance Authorization accordingly stands quashed and set aside - petition allowed.

Summary

Issues:
Challenge to non-issuance of Advance Authorization for import and export of gold items based on public notice. Review of rejection based on subsequent notification. Applicability of public notice and subsequent notification to the petitioner. Retrospective effect of subsequent notification on Advance Authorization.

Analysis:
The petitioner, a recognized export house, challenged the Directorate General of Foreign Trade's refusal to issue Advance Authorization for importing gold bars and exporting gold items based on a public notice. The rejection was premised on Public Notice No.35/(2015-2020), which was also challenged in a previous case where the court quashed the notice. The rejection letter cited the public notice as the reason for denial. The rejection was reviewed but rejected on the grounds of the petitioner not being a party to the previous case.

The subsequent notification reiterated the same restrictions on Advance Authorization for gold items. The petitioner argued that the subsequent notification could not have a retrospective effect and should not apply to their case. The court referred to the legal position that a later notification cannot be applied retrospectively, citing the case law of Director General of Foreign Trade v. Kanak Exports, 2015. The court held that the rejection based on the subsequent notification was untenable.

The court emphasized that the quashed public notice could not be relied upon to refuse the Advance Authorization. The rejection was quashed and set aside based on the legal position that a subsequent notification cannot have retrospective effect. The court directed the Directorate General of Foreign Trade to process the petitioner's case in accordance with the law within six weeks. The writ petition and pending applications were disposed of accordingly.