IN THE HIGH COURT OF DELHI AT NEW DELHI
JUSTICE S. MURALIDHAR
VACMET PACKAGINGS (INDIA) PVT LTD - Petitioner
versus
UNION OF INDIA & ANR - Respondents
W.P.(C) 9376/2009
Decided on : 15.12.2010
1. The short question in this petition is whether the Petitioner company Vacmet Packagings (India) Pvt. Ltd. („VPIPL?) is entitled to avail of the „Target Plus Scheme? announced as part of the Foreign Trade Policy 2004-09 („FTP 2004-09?) announced by the Ministry of Commerce and Industry, Government of India. Para 3.7.2 of the FTP 2004-09 spells out the eligibility criteria as under:“3.7.2 All Star Export Houses (including Status Holders as defined in para 3.7.1 of Exim Policy 2002-07) which have achieved a minimum export turnover in free foreign exchange of Rs. 10 crores in the previous licencing year are eligible for consideration under the Target Plus Scheme.”
2. It is not in dispute that VPIPL is a Star Export House. Para 3.7.4 indicates who can apply under the Target Plus Scheme. It reads as under:“3.7.4 Companies which are Star Export Houses as well as part of a Group company shall have an option to either apply as an individual company or as a Group based on the growth in the Group?s turnover as a whole. (For the purpose of this scheme the definition of Group Company? as given in Chapter 9 will be applicable. Furthermore only such companies of the Group as are Star Export Houses will be considered).If a Group company chooses to apply based on the export of one or more of its individual Star Export House companies, the entitlement would be calculated considering the export performance of the applicant company during the previous licencing year and current licencing year. It shall be necessary that the adjusted export performance of all the Star Export House companies of the Group during the current licencing year does not fall below the combined performance of all Star Export House companies of the Group in the previous licencing year. In case the Group chooses to apply based on the overall growth in Group?s turnover (i.e. the turnover of all the Star Export House companies), any one of the Star Export House companies of the Group may file an application on behalf of all the Star Export House companies of the Group.”
3. The case of the Petitioner is that it has another „enterprise? which is in fact a partnership firm in the name of M/s Polypacks Industries having three partners Mr. Dinesh Chand Aggarwal, Mr. Suresh Chand Aggarwal and Mr. Raj Narain Aggarwal. It is stated that the said firm is also a recognised Star Export House.The contention of the Petitioner is that M/s Polypacks Industries is a „group company? of VPIPL for the purposes of Clause 3.7.4 of theFTP 2004-09 .
4. The above clause incorporates by reference the definition of a „group company? as contained in Clause 9.28 of the FTP 2004-09 which reads as under: “9.28“Group Company” means two or more enterprises which directly or indirectly, are in a position to- (i) exercise twenty-six per cent or more of the voting rights in the other enterprise; or (ii) appoint more than fifty percent, of the members of the board of directors in the other enterprise; orFor the group companies to claim benefits or have their exports counted for benefits to be claimed by another member of the group, the group company should have been in existence at least 2 years prior to the date of application under any of the export promotion schemes notified in the Policy.”
5. The Petitioner is aggrieved by the rejection on 23rd June 2008 of Ministry of Law and Justice to the Petitioner?s contention that firm M/s. Polypacks Industries is a group company of VPIPL. Resultantly the Petitioner?s claim under the Target Plus Scheme was rejected by an order dated 4th May 2008 which was communicated to the Petitioner on 3rd December 2008. These orders have been challenged in the present petition.
6. Mr. Gera, learned counsel appearing for the Petitioner submits that the definition of „group company? in para 9.28 of FTP 2004-09 only refers to “two or more enterprises” and does not require both those enterprises to be the companies. According to him one of the enterprises could be a company and the
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