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TMI Blog2009 (9) TMI 133X X X X Extracts X X X X X X X X Extracts X X X X ..... n these circumstances it will be open to the petitioners within sixty days from today to apply to the respondents to exercise their powers under Rule 15 of the Rules. It is for the respondents to consider the same and act according to law at any rate not later than six months from the petitioners so applying. – petitioner is at liberty to apply for relaxation of rules and respondent to consider the same - 871 of 1994, - - - Dated:- 18-9-2009 - <?xml:namespace prefix = st2 /> Ferdino I. Rebello and D.G. Karnik, JJ. S/Shri Pankaj A. Sawant with Ms. Trupti M. Kapadia and V.C. Murlidharan i/b. Joy Legal Consultants, for the Petitioner. Ms. S.V. Bharucha and S/Shri R.G. Bhat with J.B. Mishra, for the Respondent. [Judgment per: Ferdino I. Rebello, J. (Oral)]. - The petitioners are exporters of Castor Oil. The Government of India framed several schemes. Under the Scheme, goods which were described in Schedule II to the Customs and Central Excise Duty Drawback Rules, 1971 (hereinafter referred to as the Drawback Rules) were entitled to a drawback on the export of such goods. The Drawback Rules have been made in exercise of the powers conferred by Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O.B. Value. 6. Based on the test to be conducted in terms of the Circular dated 3rd October, 1964 the Castor Oil exported by the petitioners was shown under Entry 'Castor Oil Medicinal' and was accordingly exported. The petitioners based on this policy continued exporting Castor Oil (Medicinal). 7. Respondents issued another Circular dated 22/23-6-1989 by which the Thin-layer Chromatographic Test was prescribed for identification of Cold drawn Castor Oil of medicinal grade under Agmark by substituting the earlier test. 8. On 6th December, 1989 by communication addressed by Under Secretary (Drawback) Government of India, to M/s. Jayant Oil Mills it was set out that on the basis of data provided and as verified by the Customs/Central Excise Department it had been decided to allow drawback at the rate as set out in the said Circular. The description of the goods were given as Castor Oil Medicinal and/or Castor Oil First Special. By that communication the petitioners were also informed of the rate fixed. 9. By communication of 3rd September, 1990 the petitioners applied for fixation of the Drawback rate against the export of Castor Oil First Special Grade in the requisite prof ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could be treated as Castor Oil (Medicinal). In other words if the Oil was extracted by the Cold Drawn method and satisfied the Thin Layer Chromatographic Test would it be treated as Castor Oil (Medicinal) and be allotted Agmark Certificate as Medicinal Grade. In respect of Castor Oil which did not pass the Thin Layer Chromatographic test it would be issued Agmark as Castor Oil First Grade. It is also pointed out that Castor Oil does not conform to BP certifications, is not of pharmaceutical grade and as such would not fall under Serial No. 12 of the Schedule Appended to Drawback Rules, 1971. The petitioners, therefore, it is submitted were rightly denied the Drawback facility. 15. At the hearing of this petition on behalf of the petitioner it is submitted that once the petitioners were allowed to export Castor Oil as Medicinal by following the test in terms of Notification of 3rd October, 1964 merely because another test was introduced by Circular of 22/23-6-1989, would not result in the Castor Oil which otherwise fell under Serial No. 12 to the Schedule to the Rules to cease to be Castor Oil medicinal. Further, merely because the petitioners were marketing their product as Cast ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion dated 21st December, 1990 Castor Oil was also included under Entry 15. Thus from 21st December, 1990 the petitioners and other exporters like the petitioners were entitled to drawback considering Serial No. 15 of Schedule II. 18. The question that we are called upon to answer is whether the petitioners are entitled to duty drawback assuming that they did not meet the prescribed test for the exports of Castor Oil between the period 22/23-6-1989 to 20-12-1990. 19. We may consider the above argument for distinct periods, the first being 22/23-6-1989 to 31-5-1990 and second period being 1-6-1989 to 6-12-1989 and third being from 7-12-1989 to 21-12-1989. 20. As noted earlier by virtue of Rule 3 of the Drawback Rules, it is open to the Government to fix the rates of drawback duty. In so far as the petitioners are concerned the Government by their communication dated 6th December, 1989 in respect of Castor Oil medicinal and/or Castor Oil First Grade had fixed rate for the period 1-6-1989 to 31-5-1990. By a further communication of 6-11-1990 the communication of 6-12-1989 was amended by substituting the description by "Castor Oil medicinal". Thus Castor Oil First Special Grade ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in respect of the goods described in the communication it could not have been open to the respondents to retrospectively amend the benefit given. Even otherwise from the reply filed on behalf of the respondents it would be clear that this was done as Castor Oil First Grade would not fall under Entry 12 namely Drugs and Pharmaceutical products. This was only because the change and nature of the test. Upto 22/23-6-1989 under the test in force the same Castor Oil could have been exported and was being exported as Castor Oil medicinal. Letter of 6th December, 1989 is recognition of this and apart from that it can also be traced to the Governmental powers under Rule 15 of the Rules to avoid hardship. Under these circumstances, in our opinion, the subsequent communication for all these reasons would be without authority of law and consequently no reliance can be placed on the letter of 6th November, 1990 amending the letter by letter dated 6-12-1989 with retrospective effect. 22. The next question is what happens in so far as subsequent period between 1-6-1989 and 6-11-1990 and/or for that matter 7-11-1990 to 20-12-1990. On behalf of the petitioners learned Counsel sought to place r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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