S. RAJENDRA BABU, J.

( 1 ) THE petitioners in these cases, who are manufacturers and exporters of goods, are entitled to Import Replenishment Licence (hereinafter referred to as 'rep Licence') under the Import-Export Regulations framed under the Imports and Exports Control Act, 1947, which facilitates import of goods that are necessary for and go into the manufacture of items which are exported.

( 2 ) APPLICATIONS for issue of REP licence are made by manufacturers/exportersunder certain schemes pursuant to procedures laid down thereunder and issued by the Controller of Imports and Exports, depending on the export performance of the manufacturer/importer. The REP licence so issued can be used by the manufacturers or importers to import goods to replenish materials used in production of goods which were exported or for further production of goods which are to be exported, or that such licences can be freely transferred or disposed off to any person and permission or licence of the licensing authority is not required. The conditions subject to which the REP licences were issued are binding on the purchasers of such licences from the manufacturers or importers and he will be entitled to import and clearance of the goods covered by such licences under the policy in question on production by the transferee of only the document of transfer of licence concerned in his name. Whenever a REP licence is transferred, the transferor is required to give a formal letter to the transferee. The relevant allegations in this regard are as set out in paras 1, 4 and 5 and for purposes of convenience are reproduced hereunder:"1. The petitioners are dealers registered under the provisions of the karnataka Sales Tax Act, 1957. The first petitioner is a manufacturer of ready-made textile garments and the said petitioner exports the ready-made textile garments to various countries. The second petitioner is a manufacturer of ready-made leather garments and the said petitioner exports the ready-made leather garments also to various countries. The petitioners earn substantial foreign exchange to the country and being exporters, the petitioners are entitled to Import Replenishment licences under the Import-Export Regulations of the government of India to facilitate import of goods which are necessary for and go into the manufacture of items which are exported. 4. REP licences issued in terms of the scheme envisaged under Chapter XV of the Import-Export Regulations/policy administered by the Chief Controller of Imports and Exports. The object of the scheme is to provide Registered exporters by way of Import Replenishment, essential inputs required in the manufacture of the products exported and to allow certain flexibility to enable diversification of the export products. 5. Applications for issue of REP licences are made by manufacturers/exporters under the scheme as per the procedures laid down thereunder and are issued by the Controller of Imports and Exports based on the export performance of the manufacturer/importer. The REP licences so issued can be used by the manufacturer/importer to import goods to replenish materials used in production of goods which were exported or for further production of goods which are to be exported or such licences can be freely transferred/disposed off to any person, and permission or endorsement of the licensing authority is not required. The licence issued to the manufacturer/importer are subject to certain terms and conditions, which are also binding on the purchaser of the REP licence from the manufacturer/importer and the purchaser of the REP licence can import any of the items mentioned in the annexure to the REP licence which the manufacturer/importer is entitled to import and clearance of the goods covered by a REP licence under this policy will be allowed by the Customs Authorities on production by the transferee of only the document of transfer of licence concerned in his name. Whenever a REP licence is transferr

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