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TMI Blog2024 (5) TMI 684X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned Single Judge was dismissed. 2. The appellant was formerly known as Emmellen Biotech Pharmaceuticals Limited, which amalgamated with Karnataka Malladi Biotics Limited based on an order of the Bombay High Court dated 24th March 2009. FACTUAL ASPECT 3. A few factual aspects will have to be set out. Karnataka Malladi Biotics Limited (for short, 'Karnataka Biotics') obtained an Export Promotion Capital Goods Licence (for short, 'the licence'), which enabled it to import certain capital equipment at a concessional rate of customs duty. Under the licence, Karnataka Biotics was permitted to import capital goods worth Rs. 23,38,882/- equivalent to US$ 64,987 CIF value, subject to the condition of the appellant exporting the finished g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the High Court of Karnataka to challenge the demand for penalty. On 24th March 2009, Karnataka Biotics amalgamated with Emmellen Biotech Pharmaceuticals Limited under the orders of the High Court. Accordingly, a certificate of incorporation for the change of the name of Emmellen Biotech Pharmaceuticals Limited to M/s Embio Limited (appellant herein) was issued. The Writ Petition filed by Karnataka Biotics was allowed by a learned Single Judge of the Karnataka High Court. The respondents challenged the same by filing a Writ Appeal. A Division Bench of the High Court disposed of the appeal by granting permission to withdraw the Writ Petition with the liberty to file a fresh Writ Petition, presumably in view of the amalgamation. 6. The presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e learned senior counsel would submit that non-fulfilment of export obligation under the licence is not a ground under Section 11 (2) of the FT Act to impose a penalty. He submitted that the order imposing penalty under Section 11 (2) of the FT Act was completely illegal. 8. The learned counsel appearing for the respondents submitted that under the scheme of rehabilitation of Karnataka Biotics, there was no clause granting a waiver of penalty which could be imposed on the ground of non-fulfilment of export obligation under the license. Learned counsel submitted that there was a contravention of the terms of the licence, and therefore, the respondents were well within their powers to impose the penalty. Learned senior counsel appearing for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld not have been dismissed on the ground that while withdrawing the earlier Writ Petition, liberty to file a fresh petition was not granted. Perhaps both the learned Single Judge and Division Bench have ignored clause 4 of the order of the Division Bench dated 13th December 2013. 10. The predecessor of the appellant was granted the licence for the import of capital goods under the concessional custom duty subject to the condition that they would export the final product and earn foreign exchange equivalent as mentioned in the licence within five years from the date of the licence. In view of the grant of the licence, Karnataka Biotics was allowed to clear the imported capital goods at a concessional rate of 15 per cent. For non-payment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y person makes or abets or attempts to make any export or import in contravention of any provision of this Act or any rules or orders made thereunder or the foreign trade policy, he shall be liable to a penalty of not less than ten thousand rupees and not more than five times the value of the goods or services or technology in respect of which any contravention is made or attempted to be made, whichever is more. ............................................................... ............................................................" ( emphasis added ) Sub-Section (2) applies when any import or export is made in contravention of any provision of the FT Act, Rules, and orders made thereunder or the foreign trade policy. 13. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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