2023 (12) TMI 1081 - HC - Customs

Seeking permission to complete the obligation of manufacturing and exporting copper wire by purchasing additional copper of the same grade from the open market and also seeking advance authorization license - HELD THAT - The request of the Petitioner is to fill up the shortage of raw material by purchasing the same from the domestic market, the same has been rejected by the Department placing reliance on Para 4.03 of the Foreign Trade Policy 2015-20. Since the Foreign Trade Policy specifically insists that in case advance authorization is issued to allow duty free import which is physically incorporated in the export product, the request to allow the Petitioner to purchase the raw material from open market for these exports could not be permitted. The Court while adjudicating administrative orders exercising its jurisdiction under Article 226 of the Constitution of India only looks into the decision making process and also the fact that whether the order is violative of any law. The reasons given in the order passed by the Respondent does not require any interference under Article 226 of the Constitution of India. A perusal of the Order challenged in the present Writ Petition indicates that the DGFT has given a proper opportunity of hearing to the other sides and, therefore, this Court is of the opinion that the decision-making process is fair. Further, even on merits, the learned Counsel for the Petitioner has not been able to establish as to why the Order is contrary to the law or that any provisions of the Foreign Trade Policy or the handbook of procedures has been violated. Resultantly, this Court finds no reason to interfere with the present Writ Petition. The writ petition is rejected.

Summary

Issues involved:
The judgment addresses the petitioners' request to extend the Export Obligation Period due to challenges faced during the COVID-19 pandemic, seeking relief from coercive customs duty recovery, permission to purchase raw materials from the market, and consideration of relaxations granted by the Government of India.

Extension of Export Obligation Period:
The petitioners sought an extension of the Export Obligation Period (EOP) citing difficulties caused by the pandemic. The court noted that the Handbook of Procedures (HBP) provides for EOP extension as per Para 4.42, indicating that sufficient time for exports against the Advance Authorizations (AAs) was available. The court highlighted the provisions for two extensions of six months each, subject to certain conditions, under the Foreign Trade Policy (FTP).

Purchase of Raw Material from Market:
The petitioners' request to fill up raw material shortage by purchasing from the market was rejected based on Para 4.03 of the FTP 2015-20. The court emphasized that Advance Authorizations are meant for duty-free imports physically incorporated in export products, and material imported under such authorizations cannot be transferred even after fulfilling the export obligation.

Judicial Review and Decision-Making Process:
The court clarified its role in adjudicating administrative orders under Article 226, focusing on the decision-making process and legality of the order. Citing B.C. Chaturvedi v Union of India, the court highlighted that judicial review ensures fair treatment, not correctness of the decision. It emphasized that interference is warranted only if the decision-making process violates natural justice or statutory rules.

Conclusion:
The court found that the decision-making process by the Directorate General of Foreign Trade (DGFT) was fair and that the order did not contravene any laws or policies. Consequently, the writ petition was rejected, and the petitioners were advised to take further legal steps if aggrieved by regional authority orders.