9911796707
TMI Blog2015 (10) TMI 2331X X X X Extracts X X X X X X X X Extracts X X X X ..... Senior Counsel a/w Mr. Pradeep S. Jetly, Mr H. V. Mehta JUDGMENT [ Per B P Colabawalla, J ] 1. Rule. Respondents waive service. By consent of parties, Rule is made returnable forthwith and heard finally. 2. By this Petition under Article 226 of the Constitution of India, the Petitioner, being a Private Limited Company, seeks to challenge the Demand-cum-Show Cause Notice dated 29th October, 2014 (for short, the 'impugned SCN') issued by Respondent No.4 (Zonal Asst. Director General of Foreign Trade). This impugned SCN was issued to the Petitioner for recovery of duty credit entitlement granted under the 'Served From India Scheme' (hereinafter referred to as 'SFIS') as prescribed in paragraphs 3.12.1 and 3.12.2 of the Foreign Trade Policy 2009-14 (for short, 'FTP 2009-14') in respect of foreign exchange earnings in the Financial Year 2011-12. In addition thereto, the Petitioner has also challenged the minutes of the meeting dated 27th December, 2011 of the Policy Interpretation Committee (for short, 'PIC') chaired by Respondent No.2 (DGFT). 3. It is the case of the Petitioner that the Respondents, by issuing the impugned SCN, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sis that the brand under which the Petitioner operates its hospitality business ('Four Seasons'), is not an Indian brand. According to the Petitioner, this is done despite there being no stipulation whatsoever in the FTP 2009-14 in this regard. This arbitrary qualification criteria sought to be applied by Respondent No.4 tantamount to an amendment in the FTP 2009-14 which is impermissible as per the provisions of the Act, is the submission. The power to amend the FTP 2009-14 lies only with the Central Government, and therefore, the said SFIS and PIC minutes are contrary to the FTP 2009-14 and apply new and arbitrary conditions in respect of the eligibility criteria under the SFIS. According to the Petitioner, therefore, the said SCN and the PIC minutes dated 27th December, 2011 cannot be sustained and ought to be set aside by us, in our extraordinary, equitable and discretionary jurisdiction under Article 226 of the Constitution of India. 8. With the help of the learned counsel, we have gone through the papers and proceedings including the impugned SCN as well as the PIC minutes dated 27th December, 2011. Firstly, it is undisputed that the brand 'Four Seasons' is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ria has been framed and evolved for the purpose of Indian Service Providers and who provide services listed in Appendix 41 of HBP Volume 1, who have free foreign exchange earning of at least ₹ 10 lakhs in current financial year. They will be eligible for Duty Credit Scrip. For individual Indian Service Providers, the minimum criteria is free foreign exchange earning of ₹ 5 (five) lakhs. Such service Providers and who are Indian service providers are therefore mentioned in 3.12.2 and they will be eligible for duty credit scrip. That gives them credit from payment of duty and that is why in paragraph 3.12.3 services which are ineligible and providers of such ineligible services are listed. They will not be entitled for benefits under FSIS scheme. 'Served from India' brand is thus granting a incentive to those eligible service providers who fulfill the eligibility criteria. The Petitioner cannot claim a vested right in matters of duty credit or exemption from payment of a duty or tax. None can say that the mandate of Article 19 (1) (g) of the Constitution of India is violated merely because at certain time and on certain occasions, the concessions and benefits were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ia exclusively. That does not get instantly recognized and respected world over as Indian brand. If Indian Service Provider is the one who is to be encouraged through home exports and the growth of the same is to be achieved then, it is not possible to agree with Mr.Dada that FSIS scheme or benefits thereunder can be availed of by parties like the petitioner. We do not see how paragraph 3.12.7 or objectives in relation to other scheme particularly 'foreign market scheme' would be of any assistance. We are not considering that scheme, reward or incentives thereunder nor we are considering its basic features. We are concerned with 'Served from India scheme'. While it is true that the definition of the term 'person' includes an individual, firm society, company, corporation or any other legal person including the DGFT officials, we are not here concerned with the interpretation of this definition at all. We proceed on the assumption that individuals and Corporate entities (international and national) fell within such a definition and are entitled to the benefits. We are also not as much concerned with the nature of services, paragraph 9.52 which defines the ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jurisdictional RA. The last date for filing application shall be 12 months from the end of relevant month/quarter/half--] year/year. (c) service providers shall submit a statement of imports made made under the Duty Credit Scrip to jurisdictional RA with a copy to jurisdictional Excise authorities (service tax cell) within one month of completion of imports of expiry of validity of Duty Credit Scrip, whichever is earlier. 3.6.1.: Ineligible Remittances and Services for SFIS Scheme. Foreign exchange remittances other than those earned for rendering of services would not be counted for entitlement. Thus other sources of foreign exchange earnings such as equity or debt participation, donations, receipt of repayment of loans etc and any other inflow of foreign exchange, unrelated to rendering of service would be ineligible. Following shall not be taken into account for calculation of entitlement: (a) Foreign Exchange remittances: 1. related to Financial Services Sector 1. Raising of all types of foreign currency loans; 2. Export proceeds realization of clients; 3. Issuance of Foreign Equity through ADRs/GDRs or other similar instruments; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Petition are squarely covered by the judgment of this Court in Naman Hotels Private Ltd.1 Not only is the said judgment binding on us but we are in full agreement with the reasoning contained therein. In our view, therefore, the challenge to the impugned SCN as well as the PIC minutes dated 27th December, 2011, would have to fail. 10. Having said this, the Petitioner apprehends that recoveries would be effected by the Respondents even for the past years by forfeiting prior incentives. We are clearly of the view that if anything is recoverable in relation to prior policies and earlier to FTP 2009-14, that is surely something which cannot be taken away by making an adjudication order in 2015. We would, therefore, hold that it will not be permissible for the authorities adjudicating claims or issues arising therefrom to recover from the Petitioner the SFIS benefits granted till 2007-08. They are clearly falling within earlier policy framework and to that extent the Petition succeeds. 11. Rule is, therefore, made absolute in the above terms. It is needless to clarify that any recoveries that are proposed for the period after 2007-2008 under FTP 2009-14, will have to be made in ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
