Bombay High Court
Shoaib Alias Richie Sequeira vs Union Of India And Ors. on 9 July, 2025
2025:BHC-OS:10389-DB
Neeta Sawant 205-wp-1942-2005.docx
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO. 1942 OF 2005
Shoaib alias Richie Sequeira ....Petitioner
: Versus :
Union of India & Ors. ....Respondents
None for the parties.
_______________________________________________________________
CORAM : ALOK ARADHE, CJ. &
SANDEEP V. MARNE, J.
DATED : 9 JULY 2025.
P.C. :
1) The present petition is filed in public interest seeking
following reliefs :
(a) for a writ or an order in the nature of a writ directing the Respondents to individually and separately file affidavits before this Hon'ble Court stating the factual aspect about the loss of revenue caused to the Government in exports and imports in relation to Exhibits "B", "D", "F" and "M" and also point out the steps undertaking by them to recover a loss of revenue to the Government till date AND Further move the Hon'ble Court should also direct the Respondents to point out the steps taken by the Respondents to plug the loopholes in import and export policies to stop further scams;
(b)for a writ or an order in nature of writ appointing an independent committee chaired by retired judge of this Hon'ble Court or the Hon'ble Supreme Court to investigate the factual aspects of the scams pointed out in the present petition The Committee may also be directed to suggest safeguards to plug ______________________________________________________________________________ Page No.1 of 5 Wednesday, 9 July 2025 ::: Uploaded on - 10/07/2025 ::: Downloaded on - 02/08/2025 00:28:35 ::: Neeta Sawant 205-wp-1942-2005.docx the loopholes in the import and export policies to stop future scams within a limited time frame;
(c) for a writ or an order in nature of writ directing the Government to formulate a policy about receiving information for informants, protecting the interest of the informants and their families and rewards to be given to the informants, and after formulating the same placed before this Hon'ble Court for its approval;
(d) For ad-interim and interim reliefs in terms of prayer clauses
(a), (b) & (c) above;
(e) For costs of this Petition;
(f) for such other and further reliefs as this Hon'ble Court may deem fit and proper;
2) None appears for the parties when the petition is called out for final hearing. We have perused the pleadings, as well as the documents filed by the parties.
3) The Petitioner seeks to highlight the alleged loopholes in implementation of duty drawback scheme/DEEC/EPCG. The Petitioner has apparently highlighted the case of one M/s. Quality Exports and M/s. Quality Apparels Pvt. Ltd. in the petition alleging large scale fraud in the implementation of Duty Drawback Scheme, DEEC (Advance License,) EPCG. The Petitioner has sought a direction for taking effective steps for plugging the loopholes in the import and export policy.
4) Perusal of the Affidavit in reply filed by the Under Secretary (Drawback), Ministry of Revenue would indicate that Petitioner's status as informer in the case of M/s. Quality Export and M/s. Quality Apparel Pvt. Ltd. has been denied and it is pleaded that the information in the case was given by Consul (Economic), Consulate General of India, Dubai in respect of the alleged fraud committed by the ______________________________________________________________________________ Page No.2 of 5 Wednesday, 9 July 2025 ::: Uploaded on - 10/07/2025 ::: Downloaded on - 02/08/2025 00:28:35 ::: Neeta Sawant 205-wp-1942-2005.docx respective firms. The Affidavit in reply sets out detailed action taken against the concerned firms in respect of the alleged Drawback fraud. Additionally, the Affidavit-in-reply sets out detailed steps take by the Customs Department for preventing such frauds in future. In our view, the purpose behind filing the present petition is served on account of various safeguards implemented by the Government of India during implementation of the DEEC Scheme, as well as EPCG Scheme. In this regard, we reproduce the steps taken by the Government of India for plugging the loopholes in the system as pleaded in para-4(g) of the Affidavit-in-reply :-
(g) The Government has taken various safeguarding measures to prevent misuse of various export promotion schemes, the details of which are given below:-
a) Safeguards under duty drawback scheme: All Industry Rates of Duty Drawback for most of the products have been expressed as advalorem rates and drawback caps have been imposed to check frauds through overinvoicing of exports.
b) Safeguards under advance licence scheme: All Advance licences and / or materials imported there under are not transferable/saleable and are subject to actual user condition.
Advance Licence is issued with a positive value addition stipulation. In order to ensure fulfillment of export obligation, the Advance Licence holder gives Bond with or without Bank Guarantees (B.G.) to Customs undertaking to fulfill the specified export obligation, failing which the licence holder becomes liable to pay differential customs duty with interest @ 15% per annum on such duty.
In terms of Para 4.30 of Handbook of Procedure every licence holder is required to maintain a true and proper account of licence-wise consumption and utilization of imported goods. Such records are required to be preserved for a period of at least three years from the date of redemption.
In cases involving default in export obligation, the DGFT authorities also initiate proceedings under the Foreign Trade (Development & Regulations) Act, 1992 and penalize the licence holder. As per the provisions of the Policy, redemption of bank ______________________________________________________________________________ Page No.3 of 5 Wednesday, 9 July 2025 ::: Uploaded on - 10/07/2025 ::: Downloaded on - 02/08/2025 00:28:35 ::: Neeta Sawant 205-wp-1942-2005.docx guarantee/LUT shall not preclude the licensing authorities/customs authorities from taking action against the licence holder for any misrepresentation, misdeclaration and default detected subsequently.
c) Safeguards under DEPB scheme: Value caps have been imposed on certain sensitive export products to curb the tendency of unscrupulous exporters to avail of unintended benefits by over-invoicing of exports. In respect of products where the credit entitlement is 10% or more, the amount of credit is restricted to 50% of the Present Market Value (PMV) of the export product. Verification of DEPB scrips is done to thwart any attempts of forgery. Efforts are in progress to establish an on-line verification of licences by linking Customs and DGFT servers.
d) Safeguards under Export Promotion Capital goods Scheme (EPCG): In order to ensure fulfillment of specified export obligation as also to secure interest of revenue, the licence holder is required to file bond with or without bank guarantee with the Customs Authorities prior to commencement of import of capital goods. Capital goods imported under EPCG Scheme are subject to actual user condition and the same cannot be transferred/sold till the export obligation is completed. In order to ensure that the capital goods imported under EPCG Scheme are not diverted, after importation/clearance of capital goods from Customs, the licence holder is required to produce a certificate from the jurisdictional Central Excise Authorities confirming installation of such capital goods in the declared premises.
After fulfillment of EO, the licence holder obtains EO discharge certificate from DGFT authorities & on the basis of the said EO discharge certificate he obtains redemption of bond/Bank Guarantee filed with Customs.
e) Safeguards under Export Oriented Units (EOUs) Electronics Hardware Technology Parks (EHTPs) and Software Technology Parks (STPs): EOU/EHTP/STP units are required to execute a legal undertaking with the Development Commissioner to fulfill the export obligation, so that they are positive net foreign exchange earner, failing which they are liable to penalty in terms of the legal undertaking.
The details of Duty Foregone under various export promotion scheme during last three years is annexed hereto at Annexure to this Affidavit-in-Reply.
As regards Exhibit F to the petition it is submitted that it is the list of defaulters against whom the recovery action in terms of section 142 of the Customs Act, 1962 has been initiated. ______________________________________________________________________________ Page No.4 of 5 Wednesday, 9 July 2025 ::: Uploaded on - 10/07/2025 ::: Downloaded on - 02/08/2025 00:28:35 ::: Neeta Sawant 205-wp-1942-2005.docx
5) In our view, the purpose behind filing the petition is served. No further orders need to be passed. Needless to observe that if any enquiry concerning subject matter of the petition is pending against any entity, the same shall be taken to its logical end in an expeditious manner. The petition is accordingly disposed of.
[SANDEEP V. MARNE, J.] [CHIEF JUSTICE]
Digitally
signed by
NEETA
NEETA SHAILESH
SHAILESH SAWANT
SAWANT Date:
2025.07.10
11:06:24
+0530
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