The DGFT's circular improperly restricted FPS benefits contrary to the Foreign Trade Policy, reaffirming that products described under ITC HS code 5407 are entitled to benefits without retroactive limitations.

JUDGMENT

(ORAL) % 13.01.2026 C. HARI SHANKAR, J.

1. By judgment dated 8 December 2014 in WP (C) 6387/2012, a learned Single Judge of this Court has upheld a challenge, by the petitioner in the said writ petition Malik Tanning Industries, to Circular No. 42 (RE-2010)/2009-14 dated 21 October 2011 issued by the Directorate General of Foreign Trade, “DGFT”, hereinafter. That judgment forms subject matter of challenge, at the instance of the DGFT, before us, in LPA 335/2015.

2. By a subsequent judgment dated 9 January 2018, the learned Single Judge sustained the challenge against the aforesaid DGFT Circular dated 21 October 2011, instituted by five other writ petitioners in WP (C) 222/2017², WP (C) 250/2017, BRD International v. Directorate General of Foreign Trade, WP (C) 257/2017⁴, WP (C) 251/2017⁵ and WP (C) 259/2017⁶, following his earlier judgment dated 8 December 2014. This subsequent judgment dated 9 January 2018 forms subject of challenge, at the instance of the DGFT, in LPA 652/2018, LPA 657/2018, LPA 659/2018, LPA

2 Good One Traders Pvt. Ltd. v. Directorate General of Foreign Trade

4 High Value Exim Pvt. Ltd. v. Directorate General of Foreign Trade 5 Attire Designers Pvt. Ltd. v. Directorate General of Foreign Trade 6 Welldone Exim Pvt. Ltd. v. Directorate General of Foreign Trade

660/2018 and LPA 661/2018.

3. As such, all these LPAs involved the same issue, which is the legality of DGFT Circular dated 21 October 2011, and as to whether the learned Single Judge was correct in striking down the said circular.

4. We have heard Mr. Piyush Beriwal, learned Counsel for the DGFT in these appeals, Mr. Naveen Malhotra, learned Counsel for the respondent in LPA 335/2015 and Dr. G.K. Sarkar, learned Counsel for the respondents in the remaining LPAs.

Facts

5. The Foreign Trade Policy, “FTP”, hereinafter is issued on a five yearly basis under Section 5⁸ of the Foreign Trade (Development and Regulation) Act, 1992 , “FTDR Act”, hereinafter. We are concerned, in these cases, with the FTP 2009-2014, notified vide Notification 1(RE-2012)/2009-2014 dated 5 June 2012 issued by the Department of Commerce, Government of India.

6. Paras 2.3 and 2.4 of the FTP provided thus:

“2.3 Interpretation of Policy (a) The decision of DGFT shall be final and binding on all matters relating to interpretation of Policy, or provision 8 5. Foreign Trade Policy. – The Central Government may, from time to time, formulate and announce, by notification in the Official Gazette, the foreign trade policy and may also, in like manner, amend that policy: Provided that the Central Government may direct that, in respect of the Special Economic Zones, the foreign trade policy shall apply to the goods, services and technology with such exceptions, modifications and adaptations, as may be specified by it by notification in the Official Gazette. in HBP v1, Handbook of Procedures Volume 1, HBP v2, Handbook of Procedures Volume 2 or classification of any item for import/export policy in the ITC (HS). (b) A Policy Interpretation Committee (PIC) may be constituted to aid and advice DGFT.”

“2.4 Procedure DGFT may, specify procedure to be followed by an exporter or importer or by any licensing/regional authority or by any other authority for purposes of