The court affirmed that the plain language of the Foreign Trade Policy dictates the applicability of exemptions without imposing additional, unjustified restrictions on duty-free imports under the DFIA scheme.

JUDGMENT

Indrajit Mahanty; CJ. - The PIL petitioner is seeking issuance of the following directions by claiming public interest-

'(a) This Hon'ble Court be pleased to issue in public interest such appropriate orders or direction as may deem just and expedient, directing the Respondents 1 and 3 to initiate appropriate action against their erring Officers who have failed to deny exemption from Basic Customs Duty to goods imported by the Transferees under Transferrable Duty Free Import Authorisation (DFIA) despite non-fulfilment of condition contained in first proviso to condition (iii) of the Custom Notification No.19 of 2015 and/or issued Transferrable DFIAs contrary to the provisions and spirit of Foreign Trade Policy;

(b) This Hon'ble Court be pleased to issue in public interest such appropriate orders or direction as may deem just and expedient, directing the officers of the Respondent nos.1 and 3 to forthwith take steps-

(i) To deny exemption from payment of Basic Customs Duty under Custom Notification No.19 of 2015 in respect of the goods imported by a Transferee under a Transferrable Duty Free Import Authorisation (DFIA), for non-fulfilment of condition contained in first proviso to condition (iii) of the said Notification read with Paragraphs 4.12 (i), 4.12 (ii), 4.29 (iv) and 4.29 (v) of Foreign Trade Policy, if the imported goods are not of same quality, technical characteristics and specifications as the materials used in the shipping bills;

(ii) To issue any Transferrable DFIA or to strictly restrict duty free import entitlement under any Transferrable DFIA already issued as per any specific material actually used with quality, technical characteristics and specifications declared by the exporter/original license holder under Appendix 4H notwithstanding Paragraph 4.27(i) of FTP and the Standard Input Output Norms;'

2. The petitioner seeks directions to initiate appropriate action against their erring Officers who have failed to deny exemption from Basic Customs Duty to goods imported by the Transferees under Transferrable Duty Free Import Authorisation (DFIA) despite non-fulfilment of condition contained in first proviso to condition (iii) of the Custom Notification No.19 of 2015 and/or issued Transferrable DFIAs contrary to the provisions and spirit of Foreign Trade Policy. He contends that the officers of the respondent-Union of India have failed in their constitutional and statutory obligation to confer exemption from duty under Custom Notification No.19 of 2015 to only those Transferees of DFIAs, who fully satisfy all the provisions of Foreign Trade Policy in its true spirit and also satisfy the conditions particularly condition (iii) of the said Notification. The petitioner contends that first proviso to condition (iii) is erroneously being construed to only require establishing broad nexus of the material to be imported and the material actually used in the export product, only for their specific name, description or quantity. He contends that in the first proviso to condition (iii) close nexus ought to be established even for the quality, technical characteristics and specifications of the material to be imported and the material actually used in the export product. He contends that the officers of the respondent-Union of India have failed to apply these provisions and conditions with such restrictive meaning in the actual spirit of the Foreign Trade Policy, and that such failure is resulting in huge revenue leakage. The inp