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TMI Blog2024 (1) TMI 647X X X X Extracts X X X X X X X X Extracts X X X X ..... marily in view of the rising price of the same in the market as huge quantity of rice was being exported from the country which had led to scarcity of non-basmati rice in the country and a consequent increase in prices for the same. A perusal of the facts of the present case does not indicate that the consignment of Non-basmati rice for remaining 11,000 MT rice was handed over to the customs before 21:57:01 hours on 20.07.2023 and was registered in Customs system or the Non-basmati rice consignment had entered the Customs Station for exportation before the appointed time and has been registered in the electronic systems of the concerned Custodian of the Customs Station with verifiable evidence of date and time stamping of these commodities having entered the Customs Station prior to 21:57:01 hours on 20.07.2023. Admittedly out of 28,000 MT of rice only about 11,000 MT of rice could be stored in the warehouse of the port due to space crunch. Paragraph (iii)(i) of the amended notification dated 29.08.2023 was not fulfilled. The Apex Court in State of West Bengal vs. Subhas Kumar Chatterjee, [ 2010 (8) TMI 1177 - SUPREME COURT] has categorically held that no mandamus lies for issuing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce and transportation to Kandla. It is stated that the Petitioner, thereafter, requested the Port Authority at Kandla to grant permission to the Petitioner to store the 28,000 MT of rice. However, due to space constraints at the port, the port authorities gave permission to store only 11,000 MT of rice. It is stated that the Petitioner stored about 11,000 MT of rice inside the port and the balance quantity of rice was stored at various private warehouses in Kandla. It is stated that the Petitioner duly filed 28 Shipping Bills for export of 28,000 MT of rice at the customs portal between 10.07.2023 and 12.07.2023. It is stated that out of 28 shipping bills, export duty for 17 shipping bills was paid by the Petitioner. It is stated that in the interregnum, a Notification bearing No. 20/2023 dated 20.07.2023 was issued by the Department of Commerce, Government of India prohibiting the export of Non-basmati white rice (semi-milled or wholly milled rice, whether or not polished or glazed: other) . Since the effect of the said notification would be on all pending exports, certain exemptions were granted to the consignments of Non-basmati rice in the Notification bearing No. 20/2023 dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vember, 2022. 4. Effect of this Notification: Export Policy of Non-basmati white rice (Semi-milled or wholly milled rice, whether or not polished or glazed: Other) under HS code 1006 30 90 is amended from 'Free to Prohibited . 3. Para (iii) of the aforesaid Notification was further amended vide Notification No. 29/2023 dated 29.08.2023. Notification dated 29.08.2023 reads as under: Subject: - Amendment in Export Policy of Non-basmati rice under HS Code 1006 30.90. S.O. (E) The Central Government, in exercise of powers conferred by Section 3 read with section 5 of the Foreign Trade (Development Regulation) Act, 1992 (No. 22 of 1992), as amended, read with Para 1.02 and 2.01 of the Foreign Trade Policy, 2023, hereby in relaxation of Notification No. 20/2023 dated 20 July, 2023 allows export of non-basmati white rice under any of the following conditions: i. The Notification No. 20/2023 [S.O. 3249(E)] dated 20th July, 2023, was published in the Gazette of India at 21:57:01 hours on 20.07.2023. Therefore, Para 2 (iii) of Notification No. 20/2023 (S.0. 3249(E)] dated 20th July, 2023 is amended as under: where Non-basmati rice consignment has been handed over to the Customs before 21 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Respondent to permit the Petitioner to export 11,000 MT of Non-basmati rice for which shipping bills had been filed by the Petitioner and the rotation number had also been generated. 8. Notice was issued in the writ petition 04.09.2023. Pleadings are complete. 9. Learned Senior Counsel appearing for the Petitioner contends that the purpose of issuing the Notification dated 20.07.2023 was to ensure that no unplanned exports which were not contemplated prior to the issuance of Notification should be permitted. He states that the genuine exporters cannot be penalised. He states that the exporters were not warned about the Notification which came suddenly on 20.07.2023. He states that before the Notification was issued, there was a valid purchase order dated 03.07.2023 with the Petitioner from its overseas buyer. The advance for the said export had been received by the Petitioner much before the notification. He states that the Petitioner had also procured the rice much prior to the notification and started the process of packaging of rice and transportation to Kandla Port. It is contended by the learned Senior Counsel for the Petitioner that the Petitioner applied before the Port Aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o export his goods from Kandla but the vessel instead of reaching Kandla had reached Bhavnagar. Learned Senior Counsel for the Petitioner, therefore, contends that even though all the conditions had not been satisfied, yet the High Court of Gujarat had permitted the clearance and unloading of the goods by directing the clearance of the loading of the goods covered under various shipping bills. He contends that even in the present case, the vessel had arrived within the territorial waters of India prior to the date on which notification bearing No. 20/2023 came into force but could not be anchored because of lack of permission from the port authorities. 12. Learned Senior Counsel for the Petitioner also contends that purposeful interpretation of conditions Para (ii), (iii) and (iv) of the notification dated 20.07.2023 and the amendment dated 29.09.2023 would show that the Petitioner took all possible steps and could not do any further. He states that the Petitioner filed all the shipping bills prior to the issuance of the Notification. He also states that the rotation number has been issued. He further states that the Petitioner applied for storage of the entire quantity of 28,000 M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erence. 15. Heard learned Counsel appearing for the Parties and perused the material on record. 16. A perusal of the Notification bearing No. 20/2023 dated 20.07.2023 and the subsequent amendment to the said Notification vide Notification No. 29/2023 dated 29.08.2023 indicates that there are five conditions which are to be fulfilled to get exemption for exporting Non-basmati white rice (semi-milled or wholly milled rice, whether or not polished or glazed: other) which has been prohibited by the Government by the issuing the said Notifications. The Government by the said Notifications decided to prohibit completely the export of Non-basmati rice primarily in view of the rising price of the same in the market as huge quantity of rice was being exported from the country which had led to scarcity of non-basmati rice in the country and a consequent increase in prices for the same. 17. Notification No. 20/2023 dated 20.07.2023 states that the decision of ban on export of Non-basmati rice will come into immediate effect. However, the said Notification has allowed the export of consignments of Non-basmati rice subject to the conditions as mentioned in the Notification. The first paragraph ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore 21:57:01 hours on 20.07.2023, then the exporter could export the non-basmati rice. The last paragraph is not applicable in the present case because no permission has been granted by the Government of India for export to the country to which rice was to be exported to meet its food security needs. 18. A perusal of the third paragraph after amendment indicates that either the consignment of non-basmati rice should have been handed over to the Customs before 21:57:01 hours on 20.07.2023 and the consignment of Non-basmati rice handed over to the customs has been registered in Customs system OR the non-basmati rice consignment has been entered the Customs Station for exportation before 21:57:01 hours on 20.07.2023 and is registered in the electronic systems of the concerned Custodian of the Customs Station with verifiable evidence of date and time stamping of these commodities having entered the Customs Station prior to 21:57:01 hours on 20.07.2023. A perusal of the facts of the present case does not indicate that the consignment of Non-basmati rice for remaining 11,000 MT rice was handed over to the customs before 21:57:01 hours on 20.07.2023 and was registered in Customs system ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd such directions may result in destruction of rule of law. 23. It is also well settled that exemptions in Notifications have to be construed strictly. [ Refer: Commr. of Customs (Imports) v. Tullow India Operations Ltd., (2005) 13 SCC 789, A.P. Steel Re-Rolling Mill Ltd. v. State of Kerala, (2007) 2 SCC 725, Collector of Customs (Preventive) v. Malwa Industries Ltd., (2009) 12 SCC 735 and CCE v. Parle Exports (P) Ltd., (1989) 1 SCC 345)] 24. The Apex Court in CCE v. Hari Chand Shri Gopal, (2011) 1 SCC 236 has held as under: Exemption clause Strict construction 29. The law is well settled that a person who claims exemption or concession has to establish that he is entitled to that exemption or concession. A provision providing for an exemption, concession or exception, as the case may be, has to be construed strictly with certain exceptions depending upon the settings on which the provision has been placed in the statute and the object and purpose to be achieved. If exemption is available on complying with certain conditions, the conditions have to be complied with. The mandatory requirements of those conditions must be obeyed or fulfilled exactly, though at times, some latitude c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed as the essence or the substance of the requirements. Like the concept of reasonableness , the acceptance or otherwise of a plea of substantial compliance depends upon the facts and circumstances of each case and the purpose and object to be achieved and the context of the prerequisites which are essential to achieve the object and purpose of the rule or the regulation. Such a defence cannot be pleaded if a clear statutory prerequisite which effectuates the object and the purpose of the statute has not been met. Certainly, it means that the Court should determine whether the statute has been followed sufficiently so as to carry out the intent for which the statute was enacted and not a mirror image type of strict compliance. Substantial compliance means actual compliance in respect to the substance essential to every reasonable objective of the statute and the Court should determine whether the statute has been followed sufficiently so as to carry out the intent of the statute and accomplish the reasonable objectives for which it was passed. 33. A fiscal statute generally seeks to preserve the need to comply strictly with regulatory requirements that are important, especially whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emaining of 11,000 MT of rice and that this circumstance cannot be taken against Petitioner because the Petitioner has already paid the export duty for 17,000 MT of rice and therefore, nothing prevented the Petitioner to pay the balance of export duty for 11,000 MT of rice as well, before the said notification No. 20/2023 came into force, and this argument cannot be accepted because directing the Respondent to relax the condition in this case would amount to forcing the Government to breach its own Notification which this Court cannot to do so by way of the present writ petition. 26. The doctrine of substantial compliance and intended use would not come in aid of the Petitioner because the purport of the Notification is to immediately put a ban on the export of Non-basmati rice, and therefore, the argument raised by the Petitioner that the Petitioner has substantially complied with the Notification and it has shipping bills, vessel call number (VCN) and the customs rotation number which shows the intention of the Petitioner to export rice would not come to its aid. The purpose of the Notification was to immediately put ban on the export of Non-basmati rice in order to meet the inte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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