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TMI Blog2018 (1) TMI 777X X X X Extracts X X X X X X X X Extracts X X X X ..... od. It is clarified that industrial valves falls squarely within the goods covered under serial no. 269 of Appendix 37D - The impugned notice cannot be sustained - petition allowed. - W.P.(C) 1180/2016 and CM No. 5175/2016 - - - Dated:- 3-1-2018 - MR. VIBHU BAKHRU J. O R D E R Petitioners Through: Mr. Devan Parikh, Senior Advocate with Mr Alok Yadav, Advocate. Respondents Through: Mr Amit Mahajan, CGSC with Ms Aastha Jain, Advocate for UOI. VIBHU BAKHRU, J 1. The petitioners have filed the present petition impugning a trade notice Trade Notice no. 11/2015 dated 14.12.2015 - issued by respondent no.3. The petitioners claim that the said notice (hereafter referred to as the impugned notice ) is contrary to the provisions of the Foreign Trade Policy (FTP) 2009-2014. 2. Petitioner no.1 is engaged in the business of manufacturing industrial valves, bulk of which are exported to other countries. According to the petitioners, petitioner no.1 is entitled to the benefits of the Focus Product Scheme (FPS) against its exports of industrial valves. The petitioners claim that in terms of the FPS, petitioner no.1 is entitled to licences equivalent to 4% of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ording to the petitioners, they are entitled to licences for a total value of ₹3,68,47,195 against the pending applications. 6. The petitioners received a deficiency letter dated 01.06.2015 in respect of one of their applications, which stated that their applications were rejected since the bills did not mention that the valves exported are of bicycles. 7. Thereafter, petitioners made a representation to DGFT seeking a clarification whether industrial valves falling under ITC (HS) Chapter 8481 were eligible for incentives under the FPS . The petitioners pointed out that ITC (HS) Code mentioned against serial no. 269 of Table 1 of Appendix 37D clearly indicated the ITC (HS) Code of the eligible products as 8481. The petitioners also pointed out that wherever the products falling under a broad classification were sought to be limited for the purposes of granting the incentive, the specific eight digit ITC (HS) Code of the eligible product(s) was mentioned instead of the four digit broad classification. However, since the ITC (HS) Code mentioned against serial no. 269 was of four digits, it must be assumed that the intention is that exports of all goods covered under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scrips against the export of parts other than those used in bicycle under ITCHS 8481 mentioned at Sl No. 269 of Appendix 37-D, Table-1 of Foreign Trade Policy 2009-14 notified vide public notice no. 52 dated 25.02.2014 or under any other Sl. No. in the earlier public notices having same description, are liable to be reviewed and corrective measures be taken to recover such claims granted by over sight. (J.M. Gupta) JOINT DIRECTOR GENERAL OF FOREIGN TRADE e-mail: [email protected] 10. This Court is unable to accept that the relevant entry at serial no. 269 ought to be read in the manner as stated in the impugned notice for the reasons as stated hereafter. 11. First of all, the product code noted against serial no. 269 is specified as 8481. Concededly, the said products are not restricted to items used in bicycles alone. The Indian Trade Classification based on Harmonised System was adopted in India for import export operations (these codes are commonly referred to as ITC (HS) Codes). The Harmonised Commodity Description and Coding System (commonly referred to as the Harmonised System or HS ) is an international nomenclature for clasification of products. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... S, specific eight digit product code of those products were mentioned in Appendix 37D to restrict the eligible products to those of the specified description; however, in case of entry at serial no. 269, a broad classification of four digit product code is stated. This clearly indicates the intention to provide benefits to exporter exporting all products falling under the said broad classification. 12. Secondly, the plain reading of the description of the product against serial no. 269 of Appendix 37D indicates that products such as valves for pipes, boiler shells, tanks, vats or the like including pressure reducing valves cannot possibly be considered as items used in bicycles. Thus, the only manner in which the said description of the goods can be read is to ignore the punctuation mark of colon after the word bicycle or read the same as a coma. It would plainly not be open for the description to be read in a manner so as to retain the meaning of the punctuation mark of colon after the word bycycle and ignore the text (which includes goods that cannot be possibly used in a bycycle) that follows. 13. Lastly and more importantly, the FPS was discontinued with effect from 31.03 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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