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TMI Blog2013 (10) TMI 903X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of the respondent's communication dated 23rd October, 2001 requiring the appellant /petitioner to re-submit the statement of exports expressing the fulfilment of their export obligation apropos the said license and also to quash the public notice No.153-ITC (PN) 90-93, dated 16th May, 1991. 3. The facts of the case are that under para 197 of the EXIM policy 1990-93 (which was given force through guidelines of 26th December, 1990 issued under REP Circular No.38/90), a license could be sought for by importers of certain capital goods for importing such goods under concessional rate of duty, subject to certain terms and conditions. One of these conditions was that the importer would comply with the requirement to export goods for a value equivalent to thrice that of the value of the capital goods imported. 4. Under the above policy, the appellant sought for and was granted permission to import certain machinery at a concessional rate of duty of 25 per cent of the CIF value of the license, which was INR 7,58,94,400/- (DM 63,92,202/-). The license, issued under EPCG Scheme, cast upon the licensee an export obligation equivalent to three times the CIF value of the license. The time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... truder of Barmag type of other items as per detailed list attached or under the provisions of the import and export (Control) Act, 1947, or rules framed thereunder, as also including the conditions specified above or if the above named importer is not able to furnish any information required by the Chief Controller of Imports and Exports under the aforesaid notification, the Import Policy and Hand book of procedures issued by the Chief Controller of Imports and Exports or if there is any other failure of any kind whatsoever for which the decision of the Government shall be final, in such events an amount equal to Rs.28,07,83,760/- (Rupees Twenty eight crores seven lakh eighty three thousand seven hundred and sixty only) (this includes the amount equal to three times the CIF value of imported capital goods plus the difference between the normal rate of customs duty and the concessional rate of customs duty as specified in the Ministry of Finance, Department of Revenue Notification No.169/90-Customs dated 3.5.1990) be demanded by the Government in whole or in part and on written demand of the Government, the Importer shall without demur pay to the Government or to any officer so auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - Rs.100 = 3.835 Total Export Obligation comes to - USD 8730180.00 8. Counsel for the appellant submitted that because of the fluctuation in foreign exchange rates, the burden of increase or decrease in the rupee value of a fully convertible currency has to be borne by the exporter. Insofar as the licensee/importer has brought into the country foreign exchange by exporting goods equivalent to three times the prevailing value of the foreign currency indicated in the import licence, he would have duly complied with the said obligation. It would therefore be unfair and unreasonably onerous upon the exporter to further suffer the consequences of a depreciating foreign currency to his detriment. Counsel further contended that the exchange rate prevalent at the issuance of licences would necessarily have to be taken as fixed since otherwise it would be impossible for the exporter to know the extent of their obligations in view of the fluctuations in foreign currency markets. He further contended that the Government's stand to benefit twice over i.e. in terms of the rupee obligation as specifically mentioned in the license and also the amount of foreign exchange which has been earned b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etitioner is concerned, export obligation was to be discharged in US $ by specifically omitting the rupee equivalent thereof. Moreover, in the counter affidavit filed on behalf of the respondents, it is clarified that prior to 16th May, 1991 (to which period two licences at pages 135 and 137 belong) the value of export obligation under EPCG Scheme used to be mentioned in Indian rupees even though export obligation was to be completed in freely convertible foreign exchange currencies. However, consequent upon issuance of public notice No.153-ITC (PN) 90-93; dated 16th May 1991 clarifying that EO under BPCG Scheme henceforth would be indicated in US $, the practice was discontinued and the licences issued/endorsed under BPCG Scheme were being issued imposing Export Obligation in US $ alone. Since this licence was endorsed under BPCG Scheme on 3rd February, 1992 value of export obligation was indicated in US $. Further the stand of the respondents appears to be correct, namely, that as per the policy amendment, the licence was converted into BPCG licence which entitled the petitioner to import the machinery at concessional rate of custom duty. It was for this reason that export obliga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... where export obligation is imposed, the value of the export obligation shall be indicated both in freely convertible currency and Indian Rupees equivalent thereof at the exchange rate prevailing on the date of issue of the licence, which exchange rate shall also be indicated on the licence. The value in Indian Rupees shall be indicated within brackets in the licence. The remittance of foreign exchange against the licence shall, however, be regulated in freely convertible currency, and no enhancement of Rupee value shall be necessary if the remittance of foreign exchange is covered by the value of licence shown in foreign currency. The export obligation shall also be discharged in freely convertible currency. (Emphasis supplied) 12. In its counter affidavit the government has argued that by application of the current exchange rate, the appellant had sought to take undue benefit of the depreciating valuation of the Indian rupee. This was not permissible under the Scheme, which has specifically noted the value of the export obligation in US $ i.e. US $11,600,459/- (i.e. three times of the CIF value). The Government had specifically mentioned the export obligation in the foreign curr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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