The central legal point established in the judgment is that a notification giving retrospective effect to an amendment in the Target Plus Scheme under the Foreign Trade (Development and Regulation) Act, 1992 was ultra vires the Act and violated the principle of promissory estoppel.

Augustine George Masih, J.

1. In the present writ petition, the challenge is to the notification dated 12.06.2006 issued by the Directorate General of Foreign Trade and Ex-Officio Additional Secretary to the Government of India, New Delhi (Annexure P-6) on the ground that the said notification has been issued without authority of law in so far as retrospective effect hasbeen given to the amendment made in the Target Plus Scheme (Annexure P-2) notified under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 (hereinafter referred to as -the Act, 1992-). A prayer has been made for issuance of a writ in the nature of mandamus declaring the notification dated 12.06.2006 (Annexure P-6) ultra vires the Act, 1992 and the Constitution of India as the same is unreasonable and arbitrary being violative of Articles Hand 19 (l)(g) of the Constitution of India in so far as the benefit has been withdrawn with retrospective effect.

2. The petitioner is engaged in the business of manufacturing and sale of various items including agricultural machinery (Tractors) etc. It is engaged in the sale of these goods on export basis to places outside the country. In view of the exports made by the petitioner Company and in recognition thereof, Certificate of Recognition as Trading House by the office of Joint Director General, Foreign Trade, has been granted. To accelerate the growth in export, various schemes are notified by the Ministry of Commerce and Industry, Government of lndia with an intention to earn foreign exchange in the country and also to globalized the Indian manufactured products. Keeping this principle in mind, the scheme was launched by the Ministry of Commerce in the year 2004 under the Foreign Trade Policy for the year 2004-2009, which included the Target Plus Scheme, copy whereof has been appended as Annexure P-2 to the writ petition. The scheme was floated with the intention to accelerate the growth in export by rewarding Star Export Houses, who have achieved a quantum growth in exports in the current licensing year in comparison to the previous licensing year. The entitlement for a duty credit of a performing Star Export House was to be based on incremental export. Under the Scheme, if a Star Export House achieved a certain percentage of incremental growth in its export in comparison to the previous licensing year, duty credit entitlement was to be granted as given in clause 3.7.3 notified under the Scheme. Clause 3.7.3 reads as under --

"3.7.3. The entitlement under this scheme would be contingent on the percentage incremental growth in FOD value of exports in the current licensing year over the previous licensing year, as under --

Percentage Incremental

Duty

Credit

Entitlement

Growth

(as a % of the incremental growth)

20% and above but below 25%

5%

25% or above but below 100%

10%

100% and above

15% (of 100%)"

3. The Ministry of Commerce and Industry, Government of India, vide its notification dated 31.03.2006 (Annexure P-5) in exercise of its powers conferred under Section 5 of the Act, 1992 read with paragraph 1.3 of the Foreign Trade Policy, 2004-2009, as amended, abolished the Target Plus Scheme for exports from 1.4.2006 onwards. Vide this notification, sub-paras 3.7.1 to 3.7.8 in para 3.7 were also deleted w.e.f. 1.4.2006. The effect of the said notification was that Target Plus Scheme stood abolished with prospective effect i.e. from 1.4.2006 onwards.

4. The petitioner has submitted that it does not have any grouse with regard to the said notification dated 31.03.2006 as it is conceded that the Government is empowered to notify any Scheme or to withdraw the same at any stage unless the same is governed by principle of promissory estoppel and it is within the power of the Government to do so. The petitioner had accepted the said decision of the Government with regard to the withdrawal of the Target Plus Scheme and had accordingly, made arrangement to manage its affairs according to