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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
UJJAL BHUYAN, MILIND N. JADHAV, JJ.
Shah Nanji Nagsi Exports Pvt. Ltd. – Petitioner
Versus
Joint Directorate General of Foreign Trade and Others – Respondents
Writ Petition No. 4838 of 2016
Decided On : 21-05-2021
Foreign Trade (Regulation) Rules, 1993 - Rule 7 - Foreign Trade (Development and Regulation) Act, 1992 - Section 11 - Constitution of India, 1950 - Article 226 - Condition of ‘actual user’ - Tariff rate - By filing this petition under Article 226 of Constitution of India, petitioner seeks quashing of orders, Order-in-original passed by Joint Director General of Foreign Trade, New Delhi - Order-in-appeal passed by Additional Director General of Foreign Trade, New Delhi and Order in review passed by Director General of Foreign Trade i.e. respondent No. 3 and further seeks a direction to respondent No. 3 to delete condition of ‘actual user’ in two licenses issued by respondent No. 3 to respondent No. 4 for importing maize (corn) for and on behalf of the petitioner - An alternative prayer has been made by petitioner to remand matter back to respondent No. 1 to adjudicate matter afresh after quashing above orders.
Finding of the Court:
Court find that this Court had directed respondent No. 1 to adjudicate show-cause notices on all issues after giving petitioner an opportunity of personal hearing - All issues would include validity of ‘actual user’ condition in licences or whether such a condition was mandatory or non-mandatory - This is because this Court had noted that show cause notices had emanated from ‘actual user’ condition which was impugned in said writ petition - Validity of ‘actual user’ condition or whether it was mandatory or not is central issue - Refusal of respondent No. 1 to adjudicate on this issue is not only violative of directions of this Court as contained in order but also amounts to non-exercise of jurisdiction vested in him - As rightly pointed out by this Court in the order core issue is insertion of actual user condition in two licences - whether such insertion is legally permissible or without entering into this aspect, whether such condition is directory or mandatory are issues which are required to be gone into by respondent No. 1 - Failure to do so has occasioned non-exercise of jurisdiction - Court is of view that impugned order passed by respondent No. 1 cannot be sustained in law and is required to be set aside and quashed - Court is further of view that matter requires to be heard afresh on all issues as directed by this Court earlier and as indicated above - Impugned orders are hereby set aside and quashed.
Result: Writ Petition Allowed.
JUDGMENT :
UJJAL BHUYAN, J.
1. Heard Mr. Vikram Nankani, learned senior counsel for the petitioner and Mr. Rajshekhar Govilkar, learned counsel for the respondents.
2. By filing this petition under Article 226 of the Constitution of India, petitioner seeks quashing of the following orders:-
(ii) Order-in-appeal dated 24.07.2015 passed by the Additional Director General of Foreign Trade, New Delhi.
(iii) Order in review dated 04.11.2015 passed by the Director General of Foreign Trade i.e. respondent No. 3.
Further seeks a direction to respondent No. 3 to delete the condition of actual user in the two licenses bearing Nos. 0550001698 dated 31.12.2009 and 0550001804 dated 09.04.2010 issued by respondent No. 3 to respondent No. 4 for importing maize (corn) for and on behalf of the petitioner. An alternative prayer has been made by the petitioner to remand the matter back to respondent No. 1 to adjudicate the matter afresh after quashing the above orders dated 14.02.2014, 24.07.2015 and 04.11.2015.
3. Relevant facts as has been pleaded and which can be culled out from the documents on record may be briefly encapsulated as under.
4. Petitioner as a trading house was incorporated in the year 1919. In the year 1997, it was incorporated into a private limited company. It is basically engaged in the business of export of rice, oil seed, food grains and pulses. In this connection, petitioner has been granted trading house certificate by the appropriate authority. Petitioner is also engaged in the import of green peas, yellow peas and corn directly as well as canalized through public sector undertakings. Petitioner is having its registered office at Nagpur in the State of Maharashtra.
5. Respondent No. 4 is a public sector undertaking and is a recognized state trading enterprise for import of maize (corn). Maize (corn) is an item the import of which was allowed under the tariff rate quota scheme.
6. On 20.11.2009, petitioner approached respondent No. 4 for import of maize (corn) under tariff rate quota as per public notice issued by the Directorate General of Foreign Trade i.e. respondent No. 3. On that basis, respondent No. 4 submitted application dated 25.11.2009 in the office of Joint Directorate General of Foreign Trade, New Delhi i.e. respondent No. 1 for an import licence for import of 7000MT of maize (corn) under tariff rate quota scheme on behalf of the petitioner. Respondent No. 1 issued import licence No. 0550001698 dated 31.12.2009 to respondent No. 4 for import of 7000 MT of maize (corn) at concessional rate of customs duty as per Ministry of Finance, Department of Revenue Notification No. 21/2002-Customs dated 01.03.2003 for the year 2009-2010 subject to actual user condition and other usual conditions.
7. On behalf of the petitioner, respondent No. 4 submitted another application dated 22.02.2010 to respondent No. 1 for obtaining an import licence for import of 6000 MT of maize (corn) under tariff rate quota. On the basis of the said application, import licence bearing No. 0550001804 dated 09.04.2010 was issued to respondent No. 4 for import of 6000 MT of maize (corn) at concessional rate as per Ministry of Finance, Department of Revenue Notification No. 33/2010-Customs dated 12.03.2010 for the year 2010-11 subject to actual user condition besides other usual conditions.
8. Petitioner has stated that on the strength of the above two licenses, respondent No. 4 imported maize (corn) and got it cleared from the customs authorities and stored in its warehouses. Thereafter it issued invoices in favour of the petitioner after adding its profit to the value of the goods imported.
9. Directorate of Revenue Intelligence initiated investigation against the petitioner on the allegation that the actual user condition in the two license was violated. Petitioner has alleged that under coercion it was compelled to pay huge amount of customs duty i.e.
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