2010 (3) TMI 504 - HC - Customs

TV Broadcast and studio equipment EXIM Policy Import during new policy while licence issued under old policy. Now question arise provisions of which policy applicable. Replenishment licence issued under policy AM 1988-91 but imports made in June 1992 after expiry of AM 1988-91. Held that- in the light of the decision of Jain Exports (P) Ltd. v. Union of India 2008 -TMI - 43311 - SUPREME COURT OF INDIA imports effected in pursuance of REP licence dated 13.12.1990 would be governed by Import Export Policy AM 1988-91.

Summary

Issues:
1. Interpretation of Import and Export Policy for the relevant period.
2. Applicability of the REP Licence under the specific policy.
3. Classification of goods as capital goods for import under the REP Licence.
4. Customs Authorities' refusal to allow the import under the REP Licence.

Issue 1: Interpretation of Import and Export Policy for the relevant period

The judgment discusses the power of the Central Government under the Imports and Exports (Control) Act, 1947, and the issuance of the Imports (Control) Order, 1955. It explains that the Government of India issues import and export policies valid for a specific period, like the one for April 1988 to March 1991 (AM 88-91). The judgment emphasizes the importance of the policy in regulating imports and exports during the stipulated period.

Issue 2: Applicability of the REP Licence under the specific policy

The judgment delves into a debate regarding whether the import should be governed by the policy in force when the REP Licence was issued or when the actual import took place. It references a Supreme Court decision to support the argument that the import should be governed by the policy of the period when the REP Licence was issued, not when the import occurred. This interpretation leads to the conclusion that the import in question falls under the AM 88-91 policy.

Issue 3: Classification of goods as capital goods for import under the REP Licence

The judgment scrutinizes the definition of capital goods under the AM 88-91 policy, highlighting that capital goods include machinery and equipment necessary for production. It further explains the provisions related to the REP Licence, emphasizing the flexibility it provides for importing capital goods without certain restrictions. The judgment concludes that the TV broadcast and studio equipment in question qualify as capital goods under the policy, making them eligible for import under the REP Licence.

Issue 4: Customs Authorities' refusal to allow the import under the REP Licence

The judgment addresses the Customs Authorities' refusal to clear the goods for import under the REP Licence, despite the equipment falling within the permissible categories. It highlights the error in the authorities' decision and rules in favor of the petitioner, directing the return of the executed ITC bonds and allowing the import under the REP Licence as per the policy provisions.

By thoroughly analyzing the interpretation of the relevant import and export policy, the applicability of the REP Licence, the classification of goods as capital goods, and the Customs Authorities' refusal, the judgment provides a comprehensive legal perspective on the case, ultimately ruling in favor of the petitioner.