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TMI Blog2022 (10) TMI 892X X X X Extracts X X X X X X X X Extracts X X X X ..... rights cannot be claimed except in accordance with the provisions of the Foreign Trade Policy and the relevant Handbook of Procedure. Revalidation of import/export license/certificate/authorization/permission - HELD THAT:- As per the provisions for the Handbook of Procedures of Foreign Trade Policy 1992-97, the application for revalidation was required to be made within a month of the expiry of the license (for initial period) or before the expiry of license (later period). Subsequently, these time limits prescribed for filing application for Enhancement/Reduction in the value of Advance Authorization as well as for Revalidation of Advance Authorizations have been removed under Paras 4.21 and 4.23 respectively under the Handbook of Procedures issued under the respective respondent of Foreign Trade Policy. Enhancement/reduction in the value of authorization - HELD THAT:- As per para 4.21 of Handbook of Procedure, the concerned Regional Authority could consider the request for enhancement or reduction in the value of the authorization. As per para 4.21.1 of the Handbook of Procedure to Foreign Trade Policy 2004-09, request for pro rata enhancement in the value and quantity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osed of with the following directions:- (i) Fourth respondent Adjudicating Authority is directed to dispose the Show Cause Notice issued on 10.05.2013 within a period of twelve months from the date of receipt of a copy of this order. (ii) To the extent, the petitioner has utilized the Advance Authorisations, it shall file necessary documents for discharging its Export Obligation undertaken. iii) To the extent, the petitioner has not utilized the Advance Authorisations it shall file necessary application for duty draw back in terms of 4.28 (iv) of Para Handbook of Procedures to 2004-09. - W.P.(MD)No.15613 of 2016 And WMP(MD)Nos.11479 & 14324 of 2016 - - - Dated:- 19-9-2022 - Honourable Mr.Justice C.Saravanan For the Petitioner : Mr.T.Mohan for M/s.D.Geetha For the Respondents : M/s.L.Victoria Gowri Asst.Solicitor General of India. ORDER This Writ Petition has been filed for issuance of a Writ of Certiorarified Mandamus, to call for the records relating to the impugned order passed by the second respondent in Case No.1 in F.No. 01/94/180/1081/AM 10/PC 4 /PRC as contained in the Minutes of the Meeting held on 05.04.2016 and 11.04.2016 and qua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t its plea has not been considered by the authority, namely DGFT, in the light of what has been explained in the letter dated 16.02.2011 and the other one, dated 28.12.2011, which calls for consideration in terms of paragraph 2.5 of the policy. Accordingly, the order of the learned Single Judge is set aside, the writ petition is allowed, by way of remand. We remand the matter to the DGFT for fresh consideration, after affording an opportunity for personal hearing to the appellant, at the earliest. 8. The Petitioner is engaged in the manufacture of yarns and sewing threads of cotton and synthetics in its factories in Madurai, Tuticorin, and Ambasamudram in Tamil Nadu, Panoli in Gujarat, and Serampore in West Bengal and markets both in the Domestic Tariff Area and in Foreign Market. 9. It is submitted that the petitioner is a major exporter of yarns and sewing threads of cotton and synthetics with an export turnover of Rs.300 Crores per annum and that the petitioner is also accorded with the status of a Star Export House and is recognized as a leading Exporter of sewing threads and yarns by the Synthetic and Rayon Textile Export Promotion Council of India. 10. These pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f, as he may deem fit and proper, on grounds of genuine hardship and adverse impact on trade to any person or class or category of persons from any provision of FTP or any Procedures. While granting such exemption, DGFT may impose such conditions as he may deem fit after consulting the Committees as under: S.No. Description Committee (a) Fixation / modification of product norms Norms Committees (b) Nexus with Capital Goods (CG) and benefits under EPCG Schemes EPCG Committee (c) All other issues Policy Relaxation Committee (PRC) C. Bare reading of the provisions of the above para, it is crystal clear that DGFT may in public interest grant exemption, relaxation or relief, as he may deem fit, after consulting PRC, on ground of genuine hardship and adverse impact on trade. Thus the policy relaxation is not a matter of right. For seeking relaxation, the applicant has to establish genuine hardship or prove beyond reasonable doubt ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 09, RA was empowered to allow one revalidation for six months on merit of the case, which the applicant has availed. So effectively, Authorisation holder was having 30 clear months to import duty free goods against the said Advance Authorisations. C. Enhancement in value and quantity of Authorisation is allowed only in situation where an exporter received export order for higher quantity than stipulated in the Advance Authorisation during its validity. Exporter for some reason, may not have time to obtain a new Authorisation. In that case, he can approach RA to allow enhancement in quantity and value of the valid Authorisation. Second situation could be that while making shipments, if a buyer suddenly enhanced the requirement and placed additional order. In that case, exporter may make excess shipment of required quantity without approaching RA for enhancement. To deal such situations, Para 4.21 of HBP provides enhancement in quantity and value of the Authorisation. However, the Authorisation holder must apply to RA concerned within the validity of such Authorisation. Enhancement in quantity and value of Authorisation will not serve any purpose, if it is not obtained within th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of equal treatment. The applicant has been given 30 month time for making import as was available to other exporters and that was more than sufficient. There is no merit in the case. The committee, therefore, did not accede to the request. 14. This is the third round of litigation before this Court. The impugned rejects the request of the petitioner for an extension of the period of validity under Paragraph 2.5 of the Foreign Trade Policy 2004-09[Later under Para 2.58 of Foreign Trade Policy 2009-2014 and Foreign Trade Policy 2013-2024] as it stood during the period when the advance authorization was procured by the petitioner from the Regional authority under the Foreign Trade Development Act, 1992 and the relevant Foreign Trade Policy (FTP) and Hand Book of Procedure (HBP). 15. The subject Advance Authorisation was issued with a validity period of 24 months from the date of their issue as per the policy in force between 2004-2009 The period of validity of the subject Advance Authorization expired during the currency of Foreign Trade Policy 2005-09 read with the relevant Handbook of Procedure (HBP) as in force till 31.03.2009 and partly during the currency of Foreign T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equently, the Applicant could not import the raw materials in proportion to the excess exports which were made during duty paid raw materials so as to meet export customer s requirement. iii.Entire export obligation under all the above said five authorizations was met in full, both terms of quantity and value, well within validity of license and also achieved value addition in excess of 15% besides excess exports. iv.Since duty paid raw materials were used in the excess exports made under the above said authorizations, the same need to be replenished for neutralization of actual incidence of duties suffered by the Applicant. v.The above stated reasons contained in the representations dated 16.02.2022 and 28.12.2011 made by the applicant make it evident that genuine hardship will be caused to the applicant unless the applicant s request for relaxation is granted under the corresponding provisions of the FTP/Procedures. vi.Applicant have not only fulfilled export obligation against the five advance authorizations well within the EO period both in terms of value and quantity but have also made additional exports within the original EO period besides having achieved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... P) respectively, particularly when the petitioner had made ZERO imports as against the quantity of 200 Tons allowed in the Authorization No. 3510020837 dated 24.04.2007 although made therein exports in excess of EO specified therein. 26. It is submitted that the petitioner obtained authorization in March 2007 on the strength of orders then present or in the pipeline. Exports made against the authorizations were made rapidly using duty paid out of raw materials which were then lying in stock. 27. It is further submitted that the customers fortuitously did not cancel the existing orders and therefore the export orders were met on time. However, there was hardly any new business or new orders for a while coupled with foreign suppliers of inputs in making supplies to the petitioner. Therefore, the petitioner could not import inputs due to dwindling exports. 28. It is further submitted that by the time the global economy recovered and orders started to trickle, respective Advance Authorisation expired and therefore the writ petitioner sought revalidation and enhancement of input entitlement in line with actual exports done (in three of the authorization) and to enable it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icy. 34. It is submitted that the petitioner, during the pendency of their representations before the second respondent, was issued with Show Cause Notices by the third respondent in respect of each of the 5 Advance Authorizations demanding submission of original authorizations together with proof of import and export documents for the redemption of all such Authorization. 35. The petitioner referred to a specific case of M/s.Claris Lifesciences Ltd, Ahmadabad wherein 2nd respondent PRC has granted revalidation of licenses in respect of applications which were filed within 2 years from the date of expiry of license taking into account that the exporter has fulfilled the EO within valid EOP vide PRC Meeting No.03/AM 09 dated 31.07.2008 Case No.32 File No.01/94/180/190/AM09/PC-4. It has been specifically stated in this case that The Committee observed that revalidation application is to be made within 2 years from the date of expiry of License . 36. The petitioner further referred to the following cases wherein the second respondent PRC has granted validation of licenses in respect of applications filed within a reasonable period after expiry of total validity per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al hearing held on 08.10.2013 in the adjudication of remand proceedings were rejected by them vide order dated 29.10.2013. 41. It is also submitted that the petitioner challenged the above rejection order of the first respondent before this Court in W.P.(MD) No. 18266 of 2013, but, the same was dismissed on 28.02.2014 and in W.A. (MD) No.575 of 2014, this Court remanded the case back to the first respondent for fresh consideration in terms of Para 2.5 of the Foreign Trade Policy vide its order dated 28.10.2015. However, the petitioner was directed to appear before the second respondent to make their representations. 42. During the personal hearing held on 05.04.2016 respondent (PRC) under the Chairmanship of the first respondent, the representation of the petitioner was rejected by the second respondent vide its impugned order dated 05.04.2016/11.04.2016 in the form of Minutes of Meeting in the Case No.1 in F.No.01/94/180/1081/AM 10 / PC 4 /PRC. Aggrieved by the same, this Writ Petition has been filed challenging the impugned order. 43. The learned counsel for the petitioner submits that the impugned order of the second respondent is unsustainable and untenable in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioner for raw materials from foreign suppliers who held back their operations partially to withstand in the global market. 47. The learned counsel for the petitioner submits that there is no dispute that the entire Export Obligation under all the four Advance Authorizations was met in full both in terms of quantity and value well within the validity period of Authorizations and in fact, the petitioner achieved value addition as fixed therein besides having made excess exports which too were made within the original Export Obligation period together with value addition. 48. The learned counsel for the petitioner submits that when the Government realized foreign exchange for the entire exports including excess exports made against the impugned 4 authorizations and the petitioner had faced genuine hardship as detailed in the above paras, any denial of the petitioner s request for Policy Relaxation to grant Revalidation and Enhancement of input quantity and value on technical grounds would cause heavy loss to the Petitioner, but revenue loss to the Government, grant of the relaxation could not cause any revenue loss to the government as the exchequer had enjoyed the ben ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ai Case No.10 Meeting No. 11/AM07 Date: 15.02.2007 July 2003 2 2 Claris Lifesciences Ltd Ahmedabad Case No.10 Meeting No. 11/AM07 Date: 15.02.2007 July 2003 3 Masturlal Pvt Ltd Bangalore Case No.1 Meeting No.09/AM07 Date: 22.11.2006 Nov 2002 Feb 2008 4 Zeal Exports West Bengal Case No.3 Meeting No.09/AM07 Date: 22.11.2006 January 2004 5 Exempler Nihon Spindle Mfg Co Pvt Ltd, Mumbai Case No.2 Meeting No. 01/08 Date: 24.05.2007 December 2003 6 Exempler Nihon Spindle Mfg Co Pvt Ltd Mumbai Case No.3 Meeting No. 01/08 Date: 24.05.2007 December 2003 53. The learned counsel for the petitioner submits that the second respondent denied the applicability of the above case references merely endorsing the views of the then Directorate General of Forei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 575 of 2014 and that the reasoning of the second respondent of restricting the applicability late cut provided under Para 9.3 of Handbook of Procedure (HBP) only to post shipment scheme / export incentives scheme / drawback scheme under Foreign Trade Policy (FTP) which has no basis in as much as the Para 9.3 specifically states any application as well as the said Para 9.3 has been provided under Chapter 9 which deals with Miscellaneous Matters covering all the situations and therefore there is no bar in applying the late cut provided under Para 9.3 of Handbook of Procedure (HBP) to the petitioner s case while granting benefit under Para 4.21 of Handbook of Procedure (HBP). 58. It is also submitted that when the second respondent himself stated in Para D(c) that the petitioner should have applied for Enhancement under Para 4.21 of Handbook of Procedure (HBP) within the validity of the Advance Authorization and in Para D(d) that the petitioner should have applied for Revalidation under Para 4.23 of Handbook of Procedure (HBP) within extendable validity of six months and that in the counter affidavit filed on behalf of the first to third respondents, it has been admitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of expiry of 24 months enabling the petitioner to import and export under the said authorization during such extended period. 63. It is further submitted that while the petitioner had obtained several Advance Authorizations from time to time from the third respondent based on their export orders and re-deemed the said Authorizations after fulfillment of the conditions specified therein including the Export Obligation regularly, the petitioner is concerned with the 5 Advance Authorizations obtained from the third respondent for the import of Polyester Filament and Polyester Staple fibre without payment of duties of customs duty for the manufacture of Polyester Polyester Corespun Yarn and sewing threads meant for export subject to fulfillment of conditions specified in the said Authorization within its validity period. 64. It is also submitted that while the petitioner had not only fulfilled the Export Obligation specified in all the 5 Advance Authorizations both in terms of quantity and value but also made excess Exports within the validity period of the said Authorizations besides achieving the value addition as fixed by the Directorate General of Foreign Trade (DG ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jection by the Policy Relaxation Committee (PRC) would result in a conscientious exporter being deprived of the import incentives on venial ground. 70. It is also submitted that when the petitioner was willing to have the benefits reduced by imposition of late cut in terms of Para 9.3 of the Handbook of Procedure (HBP) of Foreign Trade Policy (FTP) within the time stipulated therein, it was not fair to deprive the petitioner of the benefits therein merely because of the passage of time. 71. It is submitted that the absence of why the petitioner was denied the benefits of relaxation without any acceptable explanation as to why in similar cases cited by the Petitioner, extension of validity to enable for imports was extended by PRC even without late cut and in some cases after imposing a composition fee of 2% [as against the 10% late cut specified in Para 9.3 of Handbook of Procedure (HBP) of Foreign Trade Policy (FTP)] which none can claim exemption/policy relaxation as a matter of right, it cannot be whimsically and arbitrarily denied. 72. It is finally submitted that the respondents, in spite of the two orders of remand of this Court, are only interested in reiterat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... obligation based on the earlier export orders booked, the petitioner was not able to utilise the Advance Authorisations as demand for the export products reduced drastically from 2009-2012 by which time these Advance Authorisations had expired. 80. It was submitted that these Advance Authorisations are valid for a period of 24 months from the date of issue and with a grace period of another six months in terms of Public Notice No.2/(PN) 1997-2002, dated 31.03.2001. 81. It is further submitted that under similar circumstances in the case of the following exporters, similar benefit has been granted to the following persons:- 11.1.M/s.Masturlal Private Limited, Bangalore in Case No.1 PRC Meeting No.09/AM07 dated 22.11.2006 Licence No.0710022414 dated 12.07.2003. 11.2.M/s.Zeal Exports, West Bengal in Case No. 3 PRC Meeting No.09/AMo7 dated 22.11.2006 Licence No.0210059954 dated 16.01.2004. 11.3.M/smpler Nihon Spindle MfgCo.Private Limited, Madurai in Case No.2 PRC Meeting No.1/08 dated 24.05.2007 Licence No.031024332 dated 22.12.2003. 11.4.M/smpler Nihon Spindle MfgCo.Private Limited, Madurai in Case No.3 PRC Meeting No.1/08 dated 24.05.2007 Licenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses. These exports could not be considered for no fault of the petitioner, but only because of the software. Mr. Ganesh strenuously argued that the petitioner is entitled to have these exports taken into consideration, as a matter of legal right even without exercise of discretionary indulgence by PRC in favour of the petitioner. 13.Mr. Ganesh argued that a large number of other exporters, including in particular, those who have made their exports on free shipping bills had applied to PRC for relaxation in the form of directions that the export made on such shipping bills should be considered towards discharge of the export obligations even though the shipping bills were free shipping bills and though the Advance License numbers could not be uploaded because of defect in the software. This specific prayer has been granted by the PRC in a large number of cases particulars whereof have been given in the writ petition. 83. He further submitted that the impugned order has to go in the light of the law laid down by the Division Bench of Delhi High Court in IFB Industries Limited 's case referred to supra . The Division Bench of Delhi High Court in IFB Industries Lim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nths and the last shipment was within 48 months of the date of the first Licenses/Authorization is neither to be found in paragraph 4.20 of the Handbook. Rather paragraph 4.20.5 of the Handbook provides: 4.20.5. Notwithstanding the provisions of para 4.20.3 and 4.20.4 above, Clubbing of all expired licences may also be permitted provided all the expired licenses have been issued during the Exim Policy period of 1992-1997 1997-2002 i.e, 1st April, 1992 to 31st March, 2002. 53.As argued by Mr. Ganesh, even though the respondent had filed lengthy and prolix affidavit, they had not attempted to counter the correctness of the specific pleadings in paragraph 13 of the writ petition. 54.From the impugned order of the PRC, it appears that the PRC has rejected the prayer of the petitioner for procedural relaxation and concession without proper application of mind to the contentions of the petitioner. 55.In a large number of cases, specific examples of which have been given in the writ petition and/or annexures thereto, PRC has considered exports under free shipping bills. Further the contention of the petitioner that exports were made under free shipping bill ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... economy of the Country and that the Directorate General of Foreign Trade (DGFT) Organization attached to the said Ministry headed by the Director General of Foreign Trade is involved in regulating and promoting the Foreign Trade through regulations as a facilitator besides notifying Foreign Trade Policy (FTP) and the Handbook of Procedures (HBP) for implementing the said Policies. 88. It is submitted that Foreign Trade Policy (FTP) provides various schemes for the promotion of Exports which includes Duty Exemption Remission Schemes specified under Chapter 4 of Foreign Trade Policy (FTP). Duty Exemption scheme comprises Advance Authorization and Duty- Free Import Authorization which enable duty free import of inputs required for export production. 89. The learned counsel for respondents submits that the Regional Authority, with whom the undertakings were executed by the petitioner as Advance Authorization holder was required to maintain a proper record in a master register indicating the starting and closing dates of obligation period and other particulars to monitor export obligation. 90. However, in respect of shipments where six months period (one year in case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eign Trade Policy make it clear that in public interest relief can be granted by the Director General of Foreign Trade by way of exemption, relaxation or relief after consulting PRC, on ground of genuine hardship and adverse impact on trade. 99. It is therefore submitted that the relaxation/ exemption form the Policy or the procedure is not a matter of right. For seeking relaxation, the petitioner was required to establish genuine hardship and/or prove beyond reasonable doubt adverse impact on trade. In this case, the petitioner has failed to establish with concrete ground of genuine hardship or adverse impact on the trade. 100. It is submitted that the argument of the learned counsel for the petitioner that the petitioner faced genuine hardship due to introduction of SAP software in all their units across India during the year 2007-09 and that the imports/exports were made from the units against the above said authorizations were incorrectly accounted resulting in loss of control over accounting of goods under the said authorizations and ultimately excess exports and corresponding shortfall in imports occurred came to the notice of petitioner much later cannot countenanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e overall balance of payment position of the Country. 101. It is further submitted that although no time limit has been prescribed for filing the request of revalidation, it can reasonably be understood that for a relief of six months validity, a request has to be filed within the validity of the Authorisation. Or, at least the Petitioner could have come within the same licensing period. 102. In this case , all their Authorisations had been issued during the licensing period of April-March 2007.They could have filed the request during this period. This was not done. Where as , they had submitted the request belatedly after expiry of three licensing periods i.e AM-2008,AM-2009,AM-2010. 103. Therefore , the policy parameters made applicable during AM-2007 cannot be applicable and extended to for the licensing period AM-2011.Hence , the request for revalidation could not be granted due to eclipse of time and as per the mandate of para 208 of FTP quoted above. 104. As far as applicability of para 4.26 of the Handbook of Procedure 2004-2009 is concerned, it is submitted that once the export obligation is completed by fulfilling the condition of the Authorisation, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion .Second situation could be that while making shipments, if a buyer suddenly enhanced the requirement and placed additional order. In that case , exporter may make excess shipment of required quantity without approaching the Regional Authority for enhancement. To deal such situations, para 4.21 of HBP provides enhancement in quantity and value of the Authorisation. However, the Authorisation Holder must apply to the Regional Authority concerned within the validity of such Authorisation. Enhancement in quantity and value of Authorisation will not serve any purpose, if it is not obtained within the validity of the Authorisation. In this case, the applicant did not approach the Regional Authority concerned for doing so. There fore he has no merit for seeking enhancement after expiry of the said 5 Authorisations. iii. The submission of the petitioner in it s notes of submission B (ii) (iii) in page 9 is incorrect and contrary to paras 4.21 4.23 of the HBP which specifies that the Regional Authority may consider a request of Authorisation Holder and grant one revalidation for 6 months from expiry date. iv. More over the provisions of late cut provided in para 9.3 of HBP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... low enhancement in quantity and value of the valid Authorisation. 110. Second situation could be where while making shipments, the buyer enhances the requirement and places additional orders. In that case, exporters may make excess shipments of required quantity without approaching the Regional Authority for enhancement. To deal with such situations, para 4.21 of HBP provides enhancement in quantity and value of the Authorisation However , the Authorisation Holder must apply to the Regional Authority concerned within the validity of such Authorisation. Enhancement in quantity and value of Authorisation will not serve any purpose, if it is not obtained within the validity of the Authorisation. In this case, the applicant did not approach the Regional Authority concerned for doing so. It is therefore submitted that there is no merit for seeking enhancement after expiry of the Authorisations. 111. The submission of the petitioner in their notes of submission B(ii) (iii) in page 9 is incorrect and contrary to paras 4.21 4.23 of the HBP which specifies that the Regional Authority may consider a request of Authorisation Holder and grant one revalidation for 6 months from expi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is a admixture of all which is impermissible. 120. As per paragraph 2.3 of the Foreign Trade Policy, the decision of the first respondent DGFTis final. It reads as under:- 2.3:Interpretation of Policy:- If any question or doubt arises in respect of interpretation of any provision contained in FTP, or classification of any item in ITC (HS) or HBP- v1 or HBP-v2, or Schedule of DEPB Rates (including content, scope or issue of an authorization there under) said question or doubt shall be referred to DGFT whose decision thereon shall be final and binding. 121. Thus, the issue ought to have attained finality long back but for previous writ petitioner that came to be filed by the petitioner. VALIDITY PERIOD OF AN ADVANCE AUTHORISATION . 122. As per Paragraph 4.1.7 of the Foreign Trade Policy, the validity of Advance Authorisation for import shall be as prescribed in Handbook of Procedure. 123 . Paragraph 2.12 of the Handbook of Procedure to Foreign Trade Policy 2004-09 prescribes the validity period of Advance Authorisation. It was 24 months . In the succeeding Foreign Trade Policy 2009-14 and the relevant Handbook of Procedure, the period of validity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... grant one revalidation for a period of 6 months from the date of expiry of the original authorization. The request(s) for revalidation of authorization shall be made in the form given in Aayaat Niryaat Form Revalidation of Authorisation (a)RA may consider a request of original Authorisation holder and grant one revalidation for 6 months from expiry date. Request(s) for revalidation of Authorisation shall be made in ANF 4E . (b) In case of revalidation of advance authorization issued prior to 27.08.2009, it should be ensured that VA is maintained at 15% (and as per details mentioned in Paragraph 4.16 of FTP) mentioned in Paragraph 4.16 of FTP or as stipulated in the Advance Authorization, whichever is higher. However, for Advance Authorizations for products with VA as per Appendix 11B, the VA shall be as per the VA stated in Appendix 11B or as stated in Advance Authorisation, whichever is higher. 130. Request for an revalidation of an Advance Authorisation can be made once for 6 months from the expiry of date of its validity in terms of Paragraph 4.23 of the Handbook of Procedure and/or for enhancement/reduction in the ent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctively under the Handbook of Procedures issued under the respective respondent of Foreign Trade Policy. 138. Therefore, it is not permissible. Thus, the application filed on 16.02.2011 was hopelessly time barred.Public Notice No.2/(PN) 1997-2002, dated 31.03.2001 referred to by the petitioner is also not relevant. It was issued in the context of Advance licence issued under EXPORT IMPORT POLICY 1997-2002. It has no relevance to the facts of the case. It reads as under: In exercise of powers conferred under Paragraph 4.11 of the Export and Import Policy, 1997-2002 as notified in the Gazette of India extraordinary, Part-II Section-3-Sub Section (ii) vide S.O.No.283 (E) dated 31.03.1997, the Director General of Foreign Trade hereby notify the following dispensation:- 2. Advance Licenses issued during 1992-97 Policy, shall be entitled for revalidation for a further period of 6 months, even if a time period of 30 months has already expired, subject to the following conditions: i. This facility will be available where exports have already been completed but the licenses could not be utilized on account of expiry of these licenses. ii.Application f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Form of the Handbook of Procedure (Vol 1). The application for the enhancement / reduction in the value of authorization shall be made in ANF 4E. 141. Though Paragraph 4.21 of the relevant Handbook of Procedure issued under the respective Foreign Trade Policy does not provide for any time limit for filing such application, it has to be construed that such application can be entertained only if the advance authorisation was alive. Further, under paragraph 4.23 RA may consider a request of original Authorization holder and grant one revalidation for 6 months from expiry date. 142. As per para 4.21 of Handbook of Procedure, the concerned Regional Authority could consider the request for enhancement or reduction in the value of the a 3. As per para 4.21.1 of the Handbook of Procedure to Foreign Trade Policy 2004-09, request for pro rata enhancement in the value and quantity may be made either before or after exports. It further stipulates that in such cases where there is a change in standard input output norm SION prior to export of the product, pro rata enhancement shall be given after calculating entitlement on revised SI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on his own or otherwise, call for records of any case pending with or decided by an officer subordinate to him or an officer of any EPC/FIEO including a Group/ Committee of officers nominated, appointed or authorised by him and pass such orders as he may deem fit is also not relevant. Claim for Exemption from the Policy / Procedure under 2.5 of 2009-14 Policy and later 2.58 of 2015-2020 is without merits. 146. The application was filed on 16.02.2011 for the first time after the extension of two years. Thus, the application was beyond the limitation. Paragraph 9.3 of the Foreign Trade Policy therefore cannot come to the rescue of the petitioner. PERIOD FOR DISCHARGING THE EXPORT OBLIGATION : 147. Period of export obligation (EO) under an Advance Authorisation commences from the date of issue of Authorisation, unless otherwise specified. Export obligation issued under FTP 2004-09, 2009-14 and 2015-20 were to be fulfilled within 18, 24 and 36 months respectively. 148. As per Paragraph 4.22 of the Handbook of Procedure with effect from 27.8.2009 the normal period of discharge of export obligation to 18 months. 149. Paragraph 4.22 Handbook of Procedure as it st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sition of fee of 5% of the duty saved on the unutilized imported items as per the authorisation. 152. In the case of the first three Advance Authorisation, the normal period of 24 months for discharging the export obligation expired on 27.3.2009 during the currency of the Foreign Trade Policy 2004-2009. In the case of the last Advance Authorisation, the normal period of 24 months for discharging the export obligation expired 23.4.2009 during the currency of the Foreign Trade Policy 2009-2014. 153. The 1st grace period of 6 month extension for discharging the export obligation expired on 27.09.2009 for the first three advance authorisation. The 1st grace period of 6 month extension for discharging the export obligation expired on 23.10.2009 for the last advance authorisation. As per sub paragraph -2 to paragraph 4.22.1 a further grace period of 6 months is prescribed. It reads as under:- Request for a further extension of six months may be considered by the Regional Authorities subject to payment of composition fee of 5% of the duty saved on all the unutilized imported items as per authorization. Similar provision does not exist in the Handbook of Procedu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the rate of 15% p.a. thereon; and b) an amount equivalent to 3% of the CIF Value of unutilized imported material through a TR in the authorised Branch of Central Bank of India indicating the Head Account ; 1453, Foreign Trade and Export Promotion and minor Head 102 . However, the provisions of this sub paragraph shall not be applicable if the unutilized imported material was freely importable on the date of import. (ii) If the export obligation is fulfilled in terms of quantity but Cases of bonafide default in fulfillment of EO may be regularized by RA as under:- i)If EO is fulfilled in terms of value, but there is a shortfall in terms of quantity, the Authorisation holder shall, for regularization, pay:- a) To customs authorities, customs duty on unutilized value of imported/indigenously procured material along with interest as notified; however, for the customs duty component, the authorization holder has the option to furnish valid duty credit scrips issued Chapter 3 of FTP and DEPB ; and b) an amount equivalent to 3% of the CIF value of unutilized imported material through a TR in authorized branch of Central B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n or class or category of persons from any provision of this Policy or any procedure and may, while granting such exemption, impose such conditions as he may deem fit. Such request may be considered only after consulting Norms Committee (NC) if the DGFT may pass such orders or grant such relaxation or relief, as he may deem fit and proper, on grounds of genuine hardship and adverse impact on trade. DGFT may, in public interest, exempt any person or class or category of persons from any provision of FTP or any procedure and may, while granting such exemption, impose such conditions as he may deem fit. Such request may be considered only after consulting committees as under: Exemption from Policy/ Procedures DGFT may in public interest pass such orders or grant such exemption, relaxation or relief, as he may deem fit and proper, on grounds of genuine hardship and adverse impact on trade to any person or class or category of persons from any provision of FTP or any procedure. While granting such exemption, DGFT may impose such conditions as he may deem fit after consulting the Committees as under: 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that it had 23 Advance Authorisation in operation but could not import goods only under 5 Licence. This show that SAP was not the reason for the alleged failure in systematic and timely monitoring of Advance Authorisation by the management of the petitioner. There are also no records to substantiate that the petitioner SAP was introduced during the period of validity of these Authorisations caused any inconvenience in implementing of SAP software in the concerned unit, they had escalated the issue with software company which had implemented SAP for the petitioner. Therefore, these submissions have been rightly rejected by the committee. 164. Under Paragraph 2.58 and 2.5 of the Foreign Trade Policy, the DGFT may pass such orders or grant such relaxation or relief, as he may deem fit and proper, on grounds of genuine hardship and adverse impact on trade. 165. The facts on record indicate that the petitioner did not have any difficulty in importing the goods under the respective Advance Authorisations during the period when there was economic recession. 166. On the other hand, it is the case of the petitioner that it has surpassed the export obligation under taken d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l action as per law, where an Authorisation Holder fails to complete export obligation or fails to submit relevant information/documents. 172. The failure of the petitioner warrants action under Paragraph 4.24.1 of the Handbook of Procedure to Foreign Trade Policy 2004-09. 173. As mentioned above, the application filed were long after the respective Advance Authorisations expired. If the petitioner had filed application for revalidation of the Authorisation within 6 months in terms of Para 4.23 of Handbook of Procedure, the petitioner could have not only asked for extension of time for discharging the Export Obligation by one year extra i.e. 6 months + 6 months in terms of para 4.22 of the Handbook of Procedure but also for enhanced value of Authorisation as per Para 4.21 of Handbook of Procedure. 174. Even if there was a bonafide default, it could have been regularized only in terms of Para 4.28 of Handbook of Procedure. Questions of pressing 9.3 of Handbook of Procedure in favour of the petitioner would not arise if the petitioner did filed application within the period stipulated therein. The expressed prescribed date would be two months from the date of expiry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e bonafide default in the discharge of export obligation. It reads as under:- 4.28 (iv). In case an exporter is unable to complete the export obligation undertaken in full and he has not made any import under the License holder will also have an option to get the License canceled and apply for drawback after obtaining permission from the Customs Authorities for conversion of shipping bills to Drawback Shipping Bills. 182. In view of the above discussion, this writ petition is disposed of with the following directions:- (i) Fourth respondent Adjudicating Authority is directed to dispose the Show Cause Notice issued on 10.05.2013 within a period of twelve months from the date of receipt of a copy of this order. (ii) To the extent, the petitioner has utilized the Advance Authorisations, it shall file necessary documents for discharging its Export Obligation undertaken. iii) To the extent, the petitioner has not utilized the Advance Authorisations it shall file necessary application for duty draw back in terms of 4.28 (iv) of Para Handbook of Procedures to 2004-09. iv) No costs. Consequently, connected miscellaneous petitions are closed. - - TaxTMI ..... X X X X Extracts X X X X X X X X Extracts X X X X
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