Telangana High Court
M/S. Rain Ch Carbon Vizag Ltd vs Office Of The Additional Director ... on 2 May, 2025
* THE HONOURABLE SRI JUSTICE N.V. SHRAVAN KUMAR
+ WRIT PETITION No.7538 of 2025
% Dated 02-05-2025
Between:
# M/s. Rain CII Carbon (Vizag) Limited and another
... Petitioners
and
$ Office of the Additional Director General of Foreign Trade,
Hyderabad and others.
.... Respondents
! Counsel for the Petitioners : Mr. Sai Sanjay Suraneni
^ Counsel for the respondents : Gadi Praveen Kumar
Deputy Solicitor General of India
< GIST : ---
>HEAD NOTE : ---
? Cases referred: :
1. (1990) 4 Supreme Court Cases 594
2. (2021) 6 Supreme Court Cases 771
3. (2022) 16 Supreme Court Cases 176
NVSK, J
2 W.P. No.7538 of 2025
THE HONOURABLE SRI JUSTICE N.V. SHRAVAN KUMAR
WRIT PETITION No.7538 of 2025
ORDER:
This writ petition is filed with the following prayer:
"(i) Declaring the action of Respondent No.1/Regional Authority, Additional Director General of Foreign Trade, Hyderabad in issuing the Rejection Letter dated 05.02.2025 bearing File No. 09AX04000927AM25 and Deficiency Letter dated 15.01.2025 bearing File No. 09AX04000927AM25 as being arbitrary, illegal besides being violative of the Petitioners' rights under Articles 14, 19 and 300 of the Constitution of India, the Foreign Trade (Development and Regulation Act), 1992, Foreign Trade Policy, 2023, DGFT Notification 68/2023 dated 07.03.2024, CAQM Order dated 15.02.2024 and the Hon'ble Supreme Court's order dated 10.10.2023 in W.P. (C) No.13029/1985, M.C. Mehta v. Union of India, and consequently quash the Rejection Letter dated 05.02.2025 bearing File No.09AX04000927AM25 and Deficiency Letter dated 15.01.2025 bearing File No. 09AX04000927AM25; and
(ii) Declare that raw pet coke (RPC) imports by the Petitioners for supply of calcined pet coke (CPC) to SEZ units in India are entitled to the grant of Advance Authorisation under the Foreign Trade Policy, 2023; and NVSK, J 3 W.P. No.7538 of 2025
(iii) Direct the Respondents to grant Advance Authorisation to the Petitioners against their Application for Grant of Advance Authorisation dated 31.12.2024 bearing File No. 09AX04000927AM25; and
(iv) Direct the Respondents to permit the Petitioners to supply CPC to SEZ units in India in terms of the order dated 15.02.2024 issued by the Commission for Air Quality Management in National Capital Region and Adjoining Areas read with the Hon'ble Supreme Court's order dated 10.10.2023 in W.P. (C) No.13029/1985, M.C. Mehta v. Union of India; and
(v) In the alternative and without prejudice to the above prayers, declare the actions of the Respondents in issuing the DGFT Notification No.68/2023 dated 07.03.2024, if and insofar as it purports to prohibit the supply of CPC by domestic calciners to SEZ units as being illegal arbitrary, illegal besides being violative of the Petitioners' rights under Articles 14 & 19 of the Constitution of India; and consequently quash the DGFT Notification No.68/2023 dated 07.03.2024, if and insofar as it purports to prohibit the supply of CPC by domestic calciners to SEZ units; and
(vi) Pass such other Order or Orders as the Hon'ble Court may deem fit and proper in the facts and circumstances of the case."
2. The Petitioner No.1 is a company incorporated under the provisions of the Companies Act, 1956. On account of its export volumes, the petitioner's company had been granted accreditation as a NVSK, J 4 W.P. No.7538 of 2025 Four-Star Export House. The petitioner Company is engaged in the business of calcined petroleum coke (hereinafter referred to as 'the CPC') manufacturing CPC from Raw Petroleum Coke (hereinafter referred to as "the RPC"). The petitioner Company had applied for issuance of Advance Authorisation for its manufacturing unit located in the domestic tariff area (DTA") in the Visakhapatnam Port, which has been in operations since 1998 with a CPC production capacity of 0.5 million Tonnes Per Annum ("TPA") and a power co-generation facility of 49 MW.
3. The Petitioner No.2 holds 425 shares of Rain Industries Limited.
4. Respondent No.1, Office of the Additional Director General of Foreign Trade, Hyderabad Regional Authority, (Additional DGFT) ("Regional Authority"), is inter alia responsible for administering the Advance Authorisation scheme under the Foreign Trade Policy (hereinafter referred to as "the FTP") for Hyderabad and Vishakhapatnam.
5. The Respondent No.2, Directorate General of Foreign Trade ("DGFT"), is the office through which the Central Government exercises its powers of regulation of foreign trade under the Foreign Trade (Development and Regulation) Act, 1992 ("FTDR Act") and the Foreign Trade Policy, 2023 (FTP").
NVSK, J 5 W.P. No.7538 of 2025
6. Respondent No.3, Union of India, Department of Commerce through the Ministry of Commerce and Industry is responsible for development and implementation of foreign trade policies.
7. The case of the petitioners, in nutshell, as stated in the affidavit, is that they are India's leading manufacturer and exporter of anode- grade CPC and are dependent on imported RPC required for the manufacture of anode-grade CPC. The requisite quantity of RPC is not available in India. The Hon'ble Supreme Court permitted the import of RPC by calciners up to 1.4 MMT per annum vide order dated 09.10.2018. Thereafter, RPC import quota was periodically allocated by the DGFT to calciners including the Petitioners' DTA Unit every financial year. The Hon'ble Supreme Court vide order dated 10.10.2023 in the PIL Proceedings, directed the Commission for Air Quality Management (CAQM) to take a fresh look into all issues pertaining to petroleum coke, after considering the pleas of various persons including the Petitioners. Pursuant to the said directions, the CAQM issued an order inter alia permitting the import of a total of 1.9 MMT RPC by CPC manufacturers for financial year 2024-25 (higher than permitted by the Hon'ble Supreme Court's order dated 09.10.2018). Pertinently, the CAQM Order specifically permitted exports by domestic calcining units to SEZ Units. The relevant paragraph of the CAQM Order is extracted herein below for reference:
NVSK, J 6 W.P. No.7538 of 2025 "I. Import of RPC and CPC by Calciners/Aluminium Industry i. Import of total 1.9 MMT RPC for CPC Manufacturers and 0.5 MMT CPC for Aluminium Industry respectively shall be permitted during 2024-25 and l.9 MMT RPC for Calciners and 0.8 MMT CPC for Alunminium Industry respectively from 2025-26 onwards, strictly subject to the following conditions:
a. ....
b. Import of pet coke (CPC/RPC) shall
be permitted to cater entirely to the domestic needs of aluminium industry and other industries, for the processes as permitted under various regulations / statutes and export of calcined pet coke through such calcining units shall be discouraged. However, "deemed exports" to SEZ units would be permitted;
c. ....
[Emphasis supplied]"
8. In compliance with the CAQM Order, the DGFT amended the Import Policy condition permitting the import of RPC subject to the terms and conditions of the CAQM Order. The relevant clauses of the DGFT Notification are extracted below:
"Revised Policy Condition:
Total import of 1.9 Million MTs of Raw Petroleum Coke (RPC) for manufacturing Calcined Petroleum Coke (CPC) and 0.5 Million MTs of CPC for Aluminium Industry respectively shall be permissible during 2024-25, and 1.9 Million MTs of RPC for manufucturing CPC manufacturing and 0.8 Million MTs of CPC for Aluminium Industry NVSK, J 7 W.P. No.7538 of 2025 respectively shall be permissible from 2025-26 onwards, subject to the following conditions:
i. Import of RPC & CPC shall be permitted only as
feedstock / raw material and under no
circumstances shall be used as fuel.
ii. Import of RPC and CPC shall be permitted to
cater entirely to the domestic needs of aluminium industry, for the processes as permitted under the relevant regulations/statutes.
iii. Import of RPC by Calciners shall be on Actual User basis and shall not be transferred to any other unit(s) including SEZ unit(s). Export of CPC by Calciners shall not be permitted.
iv. All other conditions as mentioned in the Commission for Air Quality Management in NCR & Adjoining Areas Order No.- F. No.160014/16/2021-MERC/Pet Coke-35 dated 15.02.2024 should also be complied with."
9. As per the Notification No.68/2023 dated 07.03.2024 issued by the DGFT, the Petitioners have applied for and received Advance Authorisation (hereinafter referred to as 'the AA') on 14.05.2024, 13.08.2024 and 28.10.2024 against the import of 81,000 MT, 55,500 MT and 35,000 MT of RPC for the manufacture and export of 54,000 MT, 37,000 MT and 23,333 MT of CPC respectively to the Vedanta SEZ. Thereafter, the petitioners made their Fourth application for Advance Authorisation on 31.12.2024 for import of 54,900 MT of RPC for manufacture and export of 36,600 MT of CPC to the Vedanta SEZ NVSK, J 8 W.P. No.7538 of 2025 Unit. However, this time around, the Regional Authority issued a Deficiency Letter on 15.01.2025 stating:
"1. As per DGFT Notification No.68/2023 dt.07.03.02024, the revised policy condition 06 (b)
(iii), import of RPC by calciners shall be on Actual use basis and shall not be transferred to any other unit(s) including SEZ unit(s). Exports of CPC by calciners are not permitted."
10. As aforesaid, the CAQM Order expressly permits exports by domestic calciners to SEZ units. Accordingly, the Petitioners responded to the Deficiency Letter on 20.01.2025. The relevant portion of the Petitioner's response dated 20.01.2025 is extracted herein below:
"...
4.1 At the outset, we would like to inform you that RCCVL DTA Unit ("DTA Unit") received the allocation of Raw Petroleum Coke ("RPC") from the Director General of Foreign Trade (DGFT) as per revised policy condition 6(b)(ii) in Notification No.68/2023 dated 07.03.2024 issued under the guidelines prescribed by Commission for Air Quality Management (CAQM) order dated 15.02.2024 under the aegis of the Hon'ble Supreme Court of India (hereinafter referred as "CAQM Order" (Annexure-1).
4.2 Accordingly, the DTA Unit has been importing/procuring the RPC on 'Actual User Basis' and not transferring any RPC to any other unit(s) including the SEZ Unit(s).
4.3. Furthermore, RCCVL DTA plant is not exporting any Calcined Petroleum Coke ("CPC") NVSK, J 9 W.P. No.7538 of 2025 outside India to comply with revised policy condition No.6 (b) (iii) of aforesaid notification stating that 'Export of CPC by calciners shall not be permitted.
4.4. In this regard, we would like to submit that the DGFT Notification No.68/2023 revised policy condition 06(b)(vi) clearly states that "All other conditions as mentioned in the Commission for Air Quality Management in NCR and Adjoining Areas Order No.F No. 160014/I6/2021 MERD/PetCoke-35 dated 15.02.2024 should also be complied with".
4.5. The Commission for Air Quality Management ("CAQM") in NCR and Adjoining Areas Order on Page 8 clearly states in the policy condition No.10.1.i.b that "... However, "deemed exports" to SEZ Units would be permitted."
As such, it can be kindly noted that the CPC export sales to the SEZ Unit located in India is permitted by both the CAQM and DGFT.
4.6. Accordingly, the aforesaid application for Advance Authorisation is meant for importing RPC, manufacturing CPC and to be supplied to Vedanta SEZ Unit, which is a 'Deemed Export' and categorically permitted by the said CAQM Order.
4.7. Based on above CAQM and DGFT Guidelines, your good office has earlier issued the Advance Authorisation to RCCVL DTA Unit for importing RPC and then for processing and supplying such manufactured CPC to Vedanta SEZ unit vide Authorisation No.0911008243 dated 28.10.2024. (Annexure-11), which is a 'Deemed Export."
NVSK, J 10 W.P. No.7538 of 2025
11. In the light of the above, the petitioners requested the Regional Authority to grant Advance Authorisation against its application dated 31.12.2024. On 05.02.2025, the Regional Authority rejected the Petitioners' Application for Advance Authorisation on the following grounds:
"Your Application has been rejected due to the following reasons.:
1. Exports to SEZ units are covered under physical/direct exports wherein a Bill of Exports is generated, whereas deemed exports are defined in Para 7.02 of FTP 2023, which does not cover exports to SEZ units as deemed exports.
2. As per DGFT Notification No.68/2023 dt.07.03.02024, the revised policy condition 06(b)(iii) import of RPC by calciners shall be on Actual use basis and shall not be transferred to any other unit(s) including SEZ unit(s). Export of CPC by calciners shall not be permitted."
12. Questioning the impugned rejection order dated 05.02.2025, the petitioners filed the present writ petition.
13. The grounds urged in writ affidavit it is submitted that the Regional Authority has erroneously refused to grant Advance Authorisation to the Petitioners vide Rejection Letter dated 05.02.2025 stating that the domestic calciners cannot supply CPC to SEZ units, and wrongly refuses Advance Authorisation to the petitioners' RPC NVSK, J 11 W.P. No.7538 of 2025 import on that basis. Further, the Regional Authority does not have the authority or jurisdiction to take a view of the term "deemed exports" that is contrary to the letter and purpose of the CAQM Order. By virtue of Clause 4.05(c)(i) read with Clause 4.03(a) of the FTP, imports incorporated in goods supplied to SEZ units are entitled to Advance Authorisation. Further, by Clause 7.02(A)(a) of the FTP, goods supplied against Advance Authorisation are "deemed exports." Thus, under the FTP, RPC imported to manufacture CPC to be supplied to an SEZ unit is a "deemed export" even for the purpose of the FTP. It is further urged that the Rejection Letter neither considers nor gives reasons for refusing to give effect to the CAQM Order, which specifically permits the domestic calciners to supply CPC to SEZ units manufactured using imported RPC.
COUNTER OF RESPONDENTS:
14. On behalf of the respondents, the Joint Director General of Foreign Trade, Hyderabad, Telangana, while denying the writ averments, filed counter affidavit, inter alia, stating that a writ petition filed under Article 226 of Constitution of India is not maintainable in view of the availability of alternative remedies by way of revision provided under Section 16 of the FT (D&R) Amendment Act, 1992 read with FT (D&R) Amendment Act, 2010 and by way of filing an application under Para 2.58 of FTP, which is extracted hereunder:
NVSK, J 12 W.P. No.7538 of 2025 "Para 2.58 Interpretation of Policy - (a) The decision of DGFT shall be final and binding on all matters relating to interpretation of Policy, or provision in Handbook of Procedures, Appendices and Aayat Niryat Forms or classification of any item for import/export in the ITC (HS)."
15. In support of this contention, reliance was placed on the following judgments. PHR Invent Educational Society v. UCO Bank and Others, (2024), Arc Private Limited vs. Vishwa Bharati Vidya Mandir & Ors., (2022) 5 SCC 345, Federal Bank Ltd. vs. Sagar Thomas & Ors., (2003) 10 SCC 733, State Bank of India vs. Arvindra Electronics (P) Ltd., 2022 SCC Online SC 1522, United Bank of India vs. Satywati Tondon & Others, (2010) 8 SCC 110, Authorized Officer, State Bank of Travancore & Another vs. Mathew K.C., (2018) 3 SCC 85, Varimadugu OBI Reddy vs. B. Sreenivasulu & Others, (2023) 2 SCC 168.
16. It is further submitted that in similar situations, the companies/firms have availed the remedy of review under Section 16 of FTDR Act, 1992 before the Director General of Foreign Trade, New Delhi and the reviewing authority has de nova considered the review application.
17. It is further submitted that the Hon'ble Supreme Court vide its Order dated 10.10.2023 in WP(C) No.13029 of 1985 titled as M. C. Mehta vs. Union of India & Ors., delegated certain issues related to pet coke, to the CAQM (Commission For Air Quality NVSK, J 13 W.P. No.7538 of 2025 Management), inter alia observing that "a holistic view would have to be taken as to the distribution of the Pet Coke available in the country and the Pet Coke required to be imported and how both of them should be distributed inter se the industries." The Commission vide its Order dated 25.10.2023 accordingly constituted an inter-ministerial Sub-Committee which deliberated the issues in detail relating to the distribution of the Pet Coke available in the country and the Pet Coke required to be imported. With regard to the issue of future import of RPC and CPC in the country for domestic use, availability of RPC in the country and total demand of CPC, the following observations were made:
i. The conversion of RPC to CPC, is associated with substantial air pollution load (S02 emissions) therefore the sulphur content in calcined pet coke is required to be reduced to 3.5% as against 7-8% sulphur content in fuel grade raw pet coke.
ii. Export of domestically manufactured CPC, by processing of imported RPC by such calciners, which substantially enhances harmful emissions and the air pollution load in the country, thus needs to be strongly discouraged; Therefore purpose of import of RPC is restricted primarily to fulfil only the domestic demand of CPC.
18. It is submitted that the Commission, accordingly, in compliance of the directions of the Hon'ble Supreme Court and the observations and recommendations made by the inter-ministerial subcommittee directed as under:
NVSK, J 14 W.P. No.7538 of 2025 "Import of pet coke (CPC/RPC) shall be permitted to cater entirely to the domestic needs off aluminium industry and other industries, for the processes as permitted under various regulations / statutes and export of calcined pet coke through such calcining units shall be discouraged."
19. It is submitted that based on the directions issued by CAQM vide its order dated 14.02.2024 a notification dated 07.03.2024 was issued by DGFT, notifying amendment in import policy condition for raw pet coke and calcined pet coke under Chapter 27 of Schedule-1 (Import Policy) of ITC (HC) 2022 with immediate effect.
20. It is submitted that from a perusal of the DGFT Notification, it permits export by domestic calcining units to SEZ units whereas, Clause 6(b)(i) and (iii) provides as follows:
"i. Import of RPC and CPC shall be permitted to cater entirely to the domestic needs of aluminium industry, for the processes as permitted under the relevant regulations /statutes.
ii. Import of RPC by Calciners shall be on Actual User basis and shall not be transferred to any other unit(s) including SEZ unit(s). Export of CPC by Calciners shall not be permitted."
21. It is further submitted that the import product mentioned in the head 'Input Details' is raw pet coke and the export product as mentioned in the Head 'Export Product' is calcined petroleum coke and noted that the Custom Notification Number as selected under NVSK, J 15 W.P. No.7538 of 2025 head 'Basic Details' of the application is 'Notification No.21/2023-Cus dated 1-4-2023 Advance Authorisation for physical exports', which is opted only for making physical exports and not deemed exports. Whereas, the CAQM order dated 15-02-2024 mentions that 'deemed exports to SEZ is permitted' and not physical exports. It is further submitted that based on the application for advance authorization, it seems that the firm has opted only for the physical exports of CPC. Since, physical export of CPC is not permitted, therefore, the application of the petitioner stood rejected and no person can claim an authorization as a right and the grant or renewal of the same can be rejected by DGFT or by the Regional Authority, by specifying valid reasons for such rejection.
22. It is further submitted that 'authorisation is not a right' and the earlier authorisations granted to the petitioners are in the process of being reviewed with the appropriate authority. The CAQM order expressly permits 'deemed exports' to SEZ units, whereas, as per FTP and SEZ act, supplies made to the SEZ units are only exports, i.e. physical exports and not deemed exports. A Special Economic Zone (SEZ) is considered a "foreign territory" for the purpose of trade operations and customs duties, meaning that goods entering SEZ are treated as if they are entering a foreign country. Respondents further refer to Section 2(m)(ii) of SEZ Act, 2005, which reads as under:
NVSK, J 16 W.P. No.7538 of 2025 Section 2 (m) (ii) of SEZ Act, 2005, export means:
"(m) "export" means (i) supplying goods, or providing services, from the Domestic Tariff Area to a Unit or Developer;' Definition of "Unit" under 2 (zc) of SEZ Act, 2005, provides as follows:
'(zc) "Unit" means a Unit set up by an entrepreneur in a Special Economic Zone and includes an existing Unit, an Offshore Banking Unit and a Unit in an International Financial Services Centre, whether established before or established after commencement of this Act:' Thus, it can be deduced from the above provision of SEZ Act, 2005 that any goods supplied from any DTA i.e. Domestic Tariff Area (where the petitioner firm is located) to any unit in a SEZ is to be considered as export i.e. physical export.
23. It is further submitted that as far as 'Deemed export' is concerned, Para 7.02 of FTP provides as follows:
7.02 Categories of Supply Supply of goods under following categories (a) to (c) by a manufacturer and under categories (d) to (g) by main / sub-
contractors shall be regarded as Deemed Exports':
A. Supply by manufacturer:
(a) Supply of goods against Advance Authorisation / Advance Authorisation for annual requirement / DFIA.
(b) Supply of goods to EOU/ STP /EHTP/BTP.
NVSK, J 17 W.P. No.7538 of 2025
(c) Supply of capital goods against EPCG Authorisation. Exports made to SEZ are not covered under the meaning of deemed exports as per FTP.
24. It is submitted that the petitioners are trying to build connection between advance authorisation, physical export and SEZ and intentionally misinterpreting the provisions. Further reference was taken to:
a. Para 4.05 (c) (1) of FTP, clearly states that advance authorization shall be issued for physical exports which also includes exports to SEZ. Meaning thereby that, supply to SEZ is considered as physical exports and not deemed exports.
b. Para 7.02 (A) (a) of FTP provides that, exports will be considered as deemed exports if in case, exports/supplies of the goods are made against Advance authorization/Advance authorization for annual requirement/DFIA. Meaning thereby that if supplies are made to the company holding advance authorization or has obtained advance authorization, then it is considered as deemed exports.
25. It is further submitted that the two provisions of the Foreign Trade Policy deal with exports under Advance Authorization (AA) but classify them differently based on the nature of the recipient. While Para 4.05(c) (i) considers supplies to SEZs as physical exports, Para 7.02(A)(a) treats supplies to Advance Authorization holders as deemed exports. Thus, the petitioner is not eligible to claim AA as a NVSK, J 18 W.P. No.7538 of 2025 right as on cumulative reading of CAQM order and FTP provisions, the firm is not doing any deemed export to SEZ unit.
26. It is further submitted that the Act itself provides the following efficacious remedies. For reference Section 16 of the Act is extracted:
"Section 16 Review: The Central Government, in the case of any decision or order made by the Director General, or the Director General in the case of any decision or order made by any officer subordinate to him, may on its or his own motion or otherwise, call for and examine the records of any proceedings, for the purpose of satisfying itself or himself, as the case may be, as to the correctness, legality or propriety of such decision or order and make such orders thereon as ay be deemed fit:
Provided that no decision or order shall be varied under this section so as to prejudicially affect any person unless such person -
(a) has, within a period of two years from the date of such decision or order, received a notice to show cause why such decision or order shall not be vaired; and
(b) has been given a reasonable opportunity of making representation and, if he so desires, of being heard in his defence.' Remedy by way of application under Para 2.58 of FTP :
Para 2.58 Interpretation of Policy - (a) The decision of DGFT shall be final and binding on all matters relating to interpretation of Policy, or NVSK, J 19 W.P. No.7538 of 2025 provision in Handbood of Procedures, Appendices and Aayat Niryat Forms or classification of any item for import / export in the ITC (HS).' Further, replying to the grounds urged, respondents submit as follows:
27. That as per the DGFT notification dated 07-03-2024, Import of RPC by Calciners shall be on actual user basis and shall not be transferred to any other unit(s) icluding SEZ unit(s). Export of CPC by calciners shall not be permitted. Further, the CAQM order expressly permits 'deemed exports' to SEZ units, whereas, as per FTP and SEZ Act, supplies made to the SEZ units are only exports, i.e. physical exports and not deemed exports.
28. That the respondents have not refused the authorisation erroneously but based on the explanations and that the impugned order is reasoned order.
29. That the DGFT is empowered to issue Notification under Section 3(2) of the FT & (DR) Act, 1992 (as amended) which provides that the Central Government may, by order published in the official Gazette, make provision for prohibiting, restricting or otherwise regulating, the import or export of goods or services or technology.
NVSK, J 20 W.P. No.7538 of 2025
30. Section 5 of the FT (D&R) Act, 1992 (as amended) reads as under:
"The Central Government may from time to time formulate and announce by notification in the Official Gazette the export and import policy and may also in the like manner amend that policy".
31. Eventually it is submitted that DGFT is well within its power to issue the Notification and the rejection order dated 05.02.2025 is a reasoned order as per Foreign Trade Policy, 2023 and the writ petition is liable to be dismissed.
SUBMISSIONS:
32. The learned Senior Counsel Sri P.Chidambaram, representing the learned counsel Sri Sai Sanjay Suraneni, appearing for the petitioners, would submit that the impugned rejection letter dated 05.02.2025 is ex facie contrary to the CAQM order and the DGFT Notification. The CAQM order gives express permission for deemed exports to SEZ Units. The DGFT Notification was issued to give effect to the CAQM Order. The reasons given by the Regional Authority are that supply by domestic units to SEZ units are not deemed exports under the FTP. Under Chapter 4 of the FTP, which deals with Advance Authorisation, Clause 4.03 states that imports of goods that are physically incorporated into goods exported are entitled to Advance Authorisation. Clause 4.05(c)(i) specifically includes in relation to imports intended for manufacturing physical exports to NVSK, J 21 W.P. No.7538 of 2025 SEZ units as being eligible for Advance Authorisation. Learned Senior Counsel refers to Chapter 4 of the Foreign Trade Policy, 2023, which is extracted for reference.
"[4] Duty Exemption/Remission Schemes 4.00 Objective Schemes under this Chapter enable duty free import of inputs for export production, including replenishment of inputs or duty remission.
4.01 Schemes
(a) Duty Exemption Schemes.
The Duty Exemption schemes consist of the following:
Advance Authorisation (AA) (which will include Advance Authorisation for Annual Requirement).
Duty Free Import Authorisation (DFlA). ....
4.03 Advance Authorisation
(a) Advance Authorisation is issued to allow duty free import of input, which is physically incorporated in export product (making normal allowance for wastage). In addition, fuel, oil, catalyst which is consumed / utilized in the process of production of export product, may also be allowed.
(b) ...
4.05 Eligible Applicant/ Export/ Supply
(a) Advance Authorisation can be issued either to a manufacturer exporter or merchant exporter tied to Supporting manufacturer.
NVSK, J 22 W.P. No.7538 of 2025
(b) ...
(c) Advance Authorisation shall be issued for:
(i) Physical export (including export to SEZ)
(ii) ...."
33. Learned Senior Counsel submit that under Chapter 7 of the FTP, which deals with "deemed exports," Clause 7.02 A (a) states that goods that are entitled to Advance Authorization are to be treated as deemed exports. Thus, the Petitioners' RPC imports being physically incorporated into the CPC and physically exported to the Vedanta SEZ unit are squarely entitled to be granted Advance Authorisation and refers to the relevant provisions of Chapter 7 of the Foreign Trade Policy, 2023, which are extracted hereunder:
"[7] Deemed Exports 7.00 Objective To provide a level-playing field to domestic manufacturers and to promote Make in India, in certain specified cases, as may be decided by the Government from time to time.
7.01 Deemed Exports
(i) "Deemed Exports" for the purpose of this FTP refer to those transactions in which goods supplied do not leave country, and payment for such supplies is received either in Indian rupees or in free foreign exchange. Supply of goods as specified in Paragraph 7.02 below shall be regarded as "Deemed Exports" provided goods are manufactured in India.
NVSK, J 23 W.P. No.7538 of 2025 7.02 Categories of Supply Supply of goods under following categories
(a) to (c) by a manufacturer and under categories
(d) to (g) by main / sub-contractors shall be regarded as Deemed Exports':
A. Supply by manufacturer:
(a) Supply of goods against Advance Authorisation / Advance Authorisation for annual requirement / DFIA.
(b) Supply of goods to EOU / STP / EHTP / BTP.
(c) Supply of capital goods against EPCG Authorisation."
34. The learned Senior Counsel further submitted that earlier the Regional Authority has permitted the petitioner No.1 to export CPC manufactured by it to SEZ Units and granted Advance Authorisations to the Petitioners on 14.05.2024, 13.08.2024 and 28.10.2024. As such, there is no justification for a sudden change in the opinion or policy from its earlier decision to grant Advance Authorisations to the Petitioners by its rejection letter dated 05.02.2025. Pertinently, the Petitioners' incoming shipments under its RPC import allocation quota for Financial Year 2024-25, are expected to arrive in the month of March. In accordance with the Petitioners Restricted Licence dated 05.04.2024, along with the Amended Licence dated 24.12.2024, the Petitioners are only authorized to import its allocated quota of RPC on or before 31.03.2025. Therefore, the Petitioners seek urgent intervention of this Court in order to enable them to import their NVSK, J 24 W.P. No.7538 of 2025 allocated RPC quota under their Restricted Licence before 31.03.2025, against Advance Authorisation which it is rightfully entitled to under the FTP. Even in the event that the Petitioners import the incoming consignments of RPC against the payment of import duties, the Petitioners will not be able to utilize the imported RPC, as the Petitioners would be unable to supply CPC to the Vedanta SEZ unit on account of the Rejection Letter. The Vedanta SEZ unit is one of the major purchasers of the CPC manufactured by the Petitioners. Thus, if the Petitioners are unable to sell CPC to the Vedanta SEZ unit, it would result in heavy losses to the Petitioners and result in the shutting down of their calcining and power co-generation plants for an extended period, as there are no other CPC consumers in India of the same size as the Vedanta SEZ unit.
35. Learned Senior Counsel would further submit that earlier the Petitioners filed W.P. (C) No.2557 of 2025 before the Delhi High Court that was dismissed by order dated 07.03.2025 on the grounds of lack of territorial jurisdiction.
36. The learned Senior Counsel further submits that the order of CAQM dated 15.02.2024 is based on the delegation of certain issues related to pet coke passed by the Hon'ble Supreme Court vide order dated 10.10.2023 and the impugned order dated 05.02.2025 is clearly a miscarriage of justice. In support of his submissions placed reliance NVSK, J 25 W.P. No.7538 of 2025 in the case of S.N. Mukherjee Vs. Union of India 1. The relevant paras 39 and 40 are extracted hereunder:
"39. The object underlying the rules of natural justice "is to prevent miscarriage of justice" and secure "fair play in action". As pointed out earlier the requirement about recording of reasons for its decision by an administrative authority exercising quasi-judicial functions achieves this object by excluding chances of arbitrariness and ensuring a degree of fairness in the process of decision- making. Keeping in view the expanding horizon of the principles of natural justice, we are of the opinion, that the requirement to record reason can be regarded as one of the principles of natural justice which govern exercise of power by administrative authorities. The rules of natural justice are not embodied rules. The extent of their application depends upon the particular statutory framework whereunder jurisdiction has been conferred on the administrative authority. With regard to the exercise of a particular power by an administrative authority including exercise of judicial or quasi-judicial functions the legislature, while conferring the said power, may feel that it would not be in the larger public interest that the reasons for the order passed by the administrative authority be recorded in the order and be communicated to the aggrieved party and it may dispense with such a requirement. It may do so by making an express provision to that effect as those contained in the Administrative Procedure Act, 1946 of U.S.A. and the Administrative Decisions (Judicial Review) Act, 1 (1990) 4 Supreme Court Cases 594 NVSK, J 26 W.P. No.7538 of 2025 1977 of Australia whereby the orders passed by certain specified authorities are excluded from the ambit of the enactment. Such an exclusion can also arise by necessary implication from the nature of the subject matter, the scheme and the provisions of the enactment. The public interest underly-ing such a provision would outweigh the salutary purpose served by the requirement to record the reasons. The said requirement cannot, therefore, be insisted upon in such a case.
40. For the reasons aforesaid, it must be concluded that except in cases where the requirement has been dispensed with expressly or by necessary implication, an administrative authority exercising judicial or quasi-judicial functions is required to record the reasons for its decision.
37. The learned Senior Counsel submitted that the counter affidavit has been filed by the respondent No.1 on authorisation on behalf of the respondents No.2 and 3. Since the counter affidavit has been filed comprehensively on behalf of all the respondents, there is no scope to file review. Further, in terms of the Section 16 of the FT (D&R) Amendment Act, 1992, no notice or show-cause notice was issued from the date of rejection decision. Hence, the petitioner has rightly invoked to challenge the rejection order under Article 226 of the Constitution of India by way of filing the present writ petition. It is further submitted that the power under Article 226 of the Constitution to issue writs can be exercised not only for the enforcement of NVSK, J 27 W.P. No.7538 of 2025 fundamental rights, but for any other purpose as well. In this regard, the learned Senior Counsel placed reliance in the case of Radha Krishan Industries Vs. State of Himachal Pradesh and others 2. Relevant Para No.27 is extracted hereunder:
"27. The principles of law which emerge are that:
27.1. The power under Article 226 of the Constitution to issue writs can be exercised not only for the enforcement of fundamental rights, but for any other purpose as well.
27.2. The High Court has the discretion not to entertain a writ petition. One of the restrictions placed on the power of the High Court is where an effective alternate remedy is available to the aggrieved person.
27.3. Exceptions to the rule of alternate remedy arise where : (a) the writ petition has been filed for the enforcement of a fundamental right protected by Part III of the Constitution; (b) there has been a violation of the principles of natural justice; (c) the order or proceedings are wholly without jurisdiction; or (d) the vires of a legislation is challenged.
27.4. An alternate remedy by itself does not divest the High Court of its powers under Article 226 of the Constitution in an appropriate case though ordinarily, a writ petition should not be entertained when an efficacious alternate remedy is provided by law.2
(2021) 6 Supreme Court Cases 771 NVSK, J 28 W.P. No.7538 of 2025 27.5. When a right is created by a statute, which itself prescribes the remedy or procedure for enforcing the right or liability, resort must be had to that particular statutory remedy before invoking the discretionary remedy under Article 226 of the Constitution. This rule of exhaustion of statutory remedies is a rule of policy, convenience and discretion.
27.6. In cases where there are disputed questions of fact, the High Court may decide to decline jurisdiction in a writ petition. However, if the High Court is objectively of the view that the nature of the controversy requires the exercise of its writ jurisdiction, such a view would not readily be interfered with."
38. The learned Senior Counsel would further submit that Chapter 4 deals with Duty Exemption / Remission Schemes wherein Clause 4.03 deals with Advance Authorisation. Clause 4.03 (a) reads that "(a) Advance Authorisation is issued to fallow duty free import of input, which is physically incorporated in export product (making normal allowance for wastage). In addition, fuel, oil, catalyst which is consumed / utilized in the process of production of export product, may also be allowed."
39. Clause 4.05 deals with Eligible Applicant / Export / Supply:
Clause 4.05 (c) reads that "Advance Authorisation shall be issued for:
(i) Physical export (including export to SEZ)."
NVSK, J 29 W.P. No.7538 of 2025
40. The learned Senior Counsel has drawn the attention of this Court to Chapter 7, which deals with Deemed Exports. Clause 7.01 (i) and (ii) reads that "(i) 'Deemed Exports' for the purpose of this FTP refer to those transactions in which goods supplied do not leave country, and payment for such supply is received either in Indian rupees or in free foreign exchange. Supply of goods as specified in Paragraph 7.02 below shall be regarded as "Deemed Exports" provided goods are manufactured in India. (ii) 'Deemed Exports' for the purpose of GST would include only the supplies notified under Section 147 of the CGST/SGST Act, on the recommendations of the GST Council. The benefits of GST and conditions applicable for such benefits would be as specified by the GST Council and as per relevant rules and notification.
41. Clause 7.02 deals with Categories of Supply, which reads that "Supply of goods under following categories (a) to (c) by a manufacturer and under categories (d) to (g) by main / sub-contractors shall be regarded as 'Deemed Exports": A. Supply by manufacturer: (a) Supply of goods against Advance Authorisation / Advance Authorisation for annual requirement / DFIA. (b) Supply of goods to EOU / STP / EHTP / BTP. (c) Supply of capital goods against EPCG Authorisation."
SUBMISSIONS OF LEARNED ASSISTANT SOLICITOR GENERAL OF INDIA
42. The learned Assistant Solicitor General of India Sri B.Narasimha Sharma appearing for the respondents submitted that the NVSK, J 30 W.P. No.7538 of 2025 respondents have fully complied with the provisions of the law and followed principles of natural justice and rejection letter is in accordance with law. He has drawn the attention of this Court to the Para No.15 of the Counter wherein it is categorically stated that "With regard to Paras 20-21 it is contented that 'AUTHORIZATION IS NOT A RIGHT'. That, Para 2.13 of Foreign Trade Policy, 2023 clearly provides the following: "No person can claim an Authorisation as a right and DGFT or RA shall have power to refuse to grant or renew the same in accordance with provisions of FT (D&R) Act, Rules made there under and FTP". Furthermore, the earlier authorizations granted to the petitioners are in the process of being reviewed with the appropriate authority." It is further submitted that the petitioners' claim as SEZ, which is to be treated as deemed exports is contrary to Clause 7.02 of Chapter 7 of Foreign Trade Policy as referred by the learned Senior Counsel for the petitioners. In support of his contention, had placed reliance in the case of Sandoz Private Limited Vs. Union of India and others 3. The relevant Paras No.38 to 41 are extracted hereunder:
"38. That brings us to Chapter 8 of FTP. The heading of Chapter 8 is "Deemed Exports".
The original Para 8.1 specified that deemed exports refer to those transactions in which goods supplied do not leave country and payment for such supplies is received either in Indian rupees or in free foreign exchange. By way of amendment, it further provided that the supply of specified 3 (2022) 16 Supreme Court Cases 176 NVSK, J 31 W.P. No.7538 of 2025 goods (noted in Para 8.2) shall be regarded as deemed exports provided goods are manufactured in India.
39. The original Para 8.1 reads thus:
"8.1. Deemed exports.--"Deemed exports"
refer to those transactions in which goods supplied do not leave country, and payment for such supplies is received either in Indian rupees or in free foreign exchange."
40. Para 8.1, after amendment, in 2012-2013 reads thus:
"8.1. Deemed exports.--"Deemed Exports"
refer to those transactions in which goods supplied do not leave country, and payment for such supplies is received either in Indian rupees or in free foreign exchange. Supply of goods as mentioned in Para 8.2 below shall be regarded as "Deemed Exports" provided goods are manufactured in India."
(amendment emphasised)
41. Para 8.2 of Chapter 8 specifies the categories of supplies which can be regarded as deemed exports. Clause (b) thereof is applicable to the present appeals. Relevant extract of original Para 8.2 is as under:
"8.2. Categories of supply.--Following categories of supply of goods by main/sub- contractors shall be regarded as "Deemed Exports"
under FTP, provided goods are manufactured in India:
NVSK, J 32 W.P. No.7538 of 2025
(a) ***
(b) Supply of goods to EOU/STP/EHTP/BTP;"
Para 8.2, after amendment, in 2012-2013 reads thus:
"8.2. Categories of supply.--Following categories of supply of goods by main/sub- contractors shall be regarded as "Deemed Exports":
(a)-(c) ***
(d) Supply of goods to EOU/STP/EHTP/BTP;"
In other words, only the specified categories of supplies are regarded as deemed exports. In that, import of goods, as specified in Para 8.2(b) from DTA supplier to the EOU is regarded as deemed exports."
43. The learned Additional Solicitor General submits that the respondents have followed the due process of law while passing rejection order dated 05.02.2025 and eventually prayed to dismiss the writ petition.
ADDITIONAL AFFIDAVIT OF PETITIONER:
44. The petitioners have filed an additional affidavit on 07.04.2025 and submitted that as per Minutes of Meeting dated 27.03.2024 and by email dated 28.11.2024, petitioner No.1 was allotted in two tranches a total of 7,05,600 MT of RPC import quota for Financial Year 2024-25. In the said Minutes dated 27.03.2024 it is stated that RPC import by calciners was permitted to cater "entirely to the domestic needs of aluminium industry (including Vedanta SEZ). In the said Meeting it is highlighted that the respondents had clearly NVSK, J 33 W.P. No.7538 of 2025 understood that the CAQM order permitted RPC import for the purpose of manufacture of CPC for supply to (i) domestic aluminium industry and (ii) the Vedanta SEZ as well.
45. It is further submitted that during the Financial Year 2024-25, petitioner No.1 imported its entire RPC import quota. Under Advance Authorisation pertaining to three applications, the petitioner No.1 imported the RPC free of duty. However, the fourth application for Advance Authorisation to import approximately 54,900 MT of RPC was rejected and is the subject matter of the dispute in this writ petition. Further, an Advance Authorisation gives to the importer (petitioner No.1 herein) two rights i.e. (i) to import free of duty and (ii) to supply to domestic aluminium industry including the Vedanta SEZ. In view of the dispute surrounding the fourth application for Advance Authorisation regarding 54,900 MT of RPC and in view of the fact that the deadline for import was 31st March, 2025, and the deadline was approaching, the petitioner No.1 was advised that irrespective of the pendency of this writ petition, the petitioner No.1 may import 54,900 MT of RPC by paying the duties. In the said circumstances, the petitioner paid duty of Rs.40,82,84,128/- (Rupees Forty Crore Eighty Two Lakh Eighty Four Thousand One Hundred and Twenty Eight only) for import of approximately 54,900 MT of RPC on 29th March, 2025.
46. It is further submitted that if the petitioner No.1 succeeds in the present writ petition, then would be entitled to refund of duties of Rs.40,82,84,128/- (Rupees Forty Crore Eighty Two Lakh Eighty Four NVSK, J 34 W.P. No.7538 of 2025 Thousand One Hundred and Twenty Eight only) as well as supply CPC to the Vedanta SEZ. Pending the writ petition, the petitioner prayed for an interim order enabling the petitioner to supply the CPC to the Vedanta SEZ. In support of the case of the petitioner, learned Senior Counsel for the petitioners made the following submissions:
(i) The first three Advance Authorisations dated 14th May 2024, 13th Augutst, 2024 and 28th October, 2024 allowed the petitioner No.1 to supply the CPC to Vedanta SEZ and there is no reason why the same right is being denied to the last application for Advance Authorisation dated 31st December, 2024 for 54,900 MT of RPC.
(ii) The Minutes of Meeting dated 27the March, 2024 which allotted the RPC for the Financial year 2024-25 clearly mentions that the petitioner No.1 was permitted to supply to the domestic aluminium industry including the Vedanta SEZ.
(iii) The Foreign Trade Policy, 2023, Chapter IV, Paragraph 4.05(c) specifically mentions that "Advance Authorisation shall be issued for: (i) Physical export (including exports to SEZ)."
(iv) Chapter VII which is relied upon by the respondents allows supply to other entities in addition to supply to SEZ. The petitioner No.1 is relying upon supply to SEZ which is specifically permitted against Advance NVSK, J 35 W.P. No.7538 of 2025 Authorisation under Chapter IV Paragraph 4.05(c) read with Chapter VII, Paragraph 7.02(A)(a).
47. The learned Senior Counsel refers to the Annexure P-17, Minutes of the Meeting held on 27.03.2024 for allocation for import of Raw Petroleum Coke for CPC manufacturing and Calcined Petroleum Coke for Aluminium Industry for Financial Year 2024-25. In the said meeting the following officers have attended:
1. Shri SBS Reddy, Addl.DGFT, DGFT
2. Shri Sanjay Manchanda, Advisor, CHT, M/o. P&NG
3. Shri. P. Somakumar, Under Secretary, M/o.P&NG
4. Shri Md.Moin Afaque, Deputy DGFT, DGFT
5. Representative from M/o.EF&CC was not present.
48. In the said meeting, the Committee noted that pursuant to the recommendations of CAQM issued vide order dated 14.02.2024, DGFT vide Notification 68/23 dated 07.03.2024 has notified that -
"Total import of 1.9 Million MTs of RPC for manufacturing CPC and 0.5 Million MTs of CPC for Aluminium Industry respectively shall be permissible during 2024-25, subject to the following conditions:
i. Import of RPC & CPC shall be permitted only as a feedstock / raw material and under no circumstances shall be used as fuel.
ii. Import of RPC and CPC shall be permitted to cater entirely to the domestic needs of Aluminium industry (including Vedanta SEZ), for the processes as permitted under the relevant regulations / statues.
NVSK, J 36 W.P. No.7538 of 2025 iii. Import of RPC by Calciners shall be on Actual User basis and shall not be transferred to any other unit(s) including SEZ unit(s). Export of CpC by Calciners shall not be permitted.
iv. Import of CPC by Aluminium Industry shall be on Actual User basis. Export of Anode by Aluminium Industry shall not be permitted.
v. All other conditions as mentioned in the Commission for Air Quality Management in NCR & Adjoining Areas Order No-F.No.160014/16/2021-MERD/PetCoke-35 dated 14.02.2024 should also be complied with.
49. The learned Senior Counsel further refers to the import allocation for Raw Pet Coke (RPC) wherein the petitioner No.1 was allocated to import 4,84,169 MT., and further submits that there are contractual obligations with the Indian Company and that the 3/4th of the contractual obligations have been completed and by virtue of that, the Government has already collected the import duty and now the CPC remains in godown and that they are duty paid goods. Therefore, the impugned rejection letter dated 05.02.2025 is against the principle of promissory estoppel.
50. In the affidavit, copy of the public notice No.49/2023, dated 11.03.2024 was filed issued by the Ministry of Commerce and Industry Department of Commerce Directorate General of Foreign Trade for import of calcined petroleum coke for aluminium industry and raw petroleum coke for CPC manufacturing industry. The said public notice was issued regarding the procedure for allocation of NVSK, J 37 W.P. No.7538 of 2025 quantities for import of calcined petroleum coke for aluminium industry and raw petroleum coke for CPC manufacturing industry for the Financial Year 2024-25.
51. A copy of the debit sheet, of the petitioner's company with respect to the import restrict licence No.0111014688 dated 05.04.2024; statements/table of petitioner's RPC imports with duty for the Financial year 2024-25; a copy of the bill entries receipts; copy of the minutes of meeting for allocation of RPC import quota for CPC manufacturing and calcined petroleum coke for aluminium industry for the Financial year 2024025 are filed.
52. Eventually, the petitioners prayed to allow the petitioner No.1 to finally supply to the Vedanta SEZ pending the writ petition. It is further submitted that on the contrary, that prejudice will be caused to the petitioner No.1 if the CPC is allowed to lie in the warehouse without being supplied to the Vedanta SEZ (which is in need of the CPC in its aluminium industry_ thereby resulting in heavy losses to the petitioner No.1.
53. Per contra, the learned Additional Solicitor General refers to the copy of the authorisation dated 05.04.2024 issued to the petitioner for import restriction items in the name of petitioner No.1 Company for a quantity of 484169.0 MT. Further, draws the attention of this Court to the Licence amendment sheet dated 24.12.2024 wherefrom conditions are extracted for reference:
NVSK, J 38 W.P. No.7538 of 2025 "(1) Import of RPC shall be permitted only as a feedstock / raw material and under no circumstances shall be used as fuel.
(2) Import of RPC shall be permitted to cater entirely to the domestic needs of aluminium industry, for the processes as permitted under the relevant regulations / statutes.
(3) Import of RPC by Calciners shall be on Actual User basis and shall not be transferred to any other unit(s) including SEZ unit(s). Export of CPC by Calciners shall not be permitted.
(4) All other conditions as mentioned in the Commission for Air Quality Management in NCR & Adjoining Areas Order No.-F.No.160014/16/2021-
MERD/PetCoke-35 dated 15.02.2024 should also be complied with.
(5) The authorisation is issued with the validity upto 31.03.2025. Imports must be completed on or before 31.03.2025 i.e. consignments must be cleared by Custom Authorities on or before 31.03.2025."
54. The learned Additional Solicitor General refers to the license amendment dated 24.12.2024 issued to the petitioners Company for 705600.000 MT, which would validate the authorisation for import is 31.03.2025 with the same conditions and further submits that earlier consignments issued are also under review.
55. Heard the learned counsel for the parties and perused the material made available on the record.
NVSK, J 39 W.P. No.7538 of 2025 ANALYSIS AND CONCLUSIONS:
56. The Hon'ble Supreme Court in order dated 09.10.2018 in the case of M.C. Mehta Vs. Union of India and others (Writ Petition (Civil) No.13029 of 1985) while hearing interlocutory applications, wherein the Union of India through the Ministry of Environment, Forests and Climate Change filed and affidavit on 08th October, 2018 regarding use of calcined pet coke (CPC) in Aluminium Industry, held that the calcined pet coke (CPC) (domestic as well as imported) can be used as raw-material for anode making in the Aluminium Industry with the revised BIS specifications.
57. In the said order, the Hon'ble Supreme Court, based on the report given by the Central Pollution Control Board (CPCB) dated 04.10.2018 observed that as per the BIS guidelines, calciners are permitted to use high sulphur containing raw petroleum coke for making CPC having sulphur content less than 3.5%. While recording the statement of the learned Amicus Curiae the view expressed by the CPCB are also acceptable to EPCA and accordingly disposed of the applications observing that the raw pet coke (domestic and imported) can be used as a feedstock for producing calcined pet coke. In the said order, the applications filed by the petitioner herein seeking certain directions, while considering the affidavit dated 23.08.2018 stating that 11 contracts have been entered into on or before 26.07.2018 for the import of Anode grade raw pet coke. Vessels NVSK, J 40 W.P. No.7538 of 2025 pertaining to these 11 contracts have already arrived some time in August, 2018. The Hon'ble Supreme Court held as under:
"In view of the orders passed, the consignment may be cleared, subject to the overall limit which is 1.4 MT per annum, as mentioned above"
and accordingly the application was disposed.
58. Further, in the said case, the Hon'ble Supreme Court on 10.10.2023 observed that the Commission for Air Quality Management (CAQM) should look into the matter afresh keeping in mind the availability of pet coke in the country and the requirement for import of pet coke which would depend, thereafter. The Hon'ble Supreme Court delegated the matter was delegated to the Commission For Air Quality Management (CAQM) as their job. Further it is also observed that "it is appropriate that the CAQM bestows consideration even on this aspect and wherever any interim directions are required, the Commission itself can pass those directions, uninfluenced by other orders which may be passed by any other Court."
59. In the said case, the Hon'ble Supreme Court disposed of I.A. No.115613 of 2021 (Application filed for clarification of order dated 09.10.2018 on behalf of RAIN CII Carbon (Vizag) Limited) wherein it was held that "Learned counsel for the applicant submits that in view of the other aspects being delegated to the Commission, the facts of the present case be also examined by the Commission itself. This request is accepted and thus, the reliefs in this application are also NVSK, J 41 W.P. No.7538 of 2025 delegated for consideration before the Commission. The application stands disposed of."
60. For better appreciation, it is necessary to extract the order dated 15.02.2024 passed by the Commission for Air Quality Management in National Capital Region and Adjoining Areas. The relevant paras No.3 and 4 and 10 are extracted for reference:
"3. The Hon'ble Supreme Court vide its Order dated 10.10.2023 in WP(C) No.13029 of 1985 titled as M.C. Mehta Vs. Union of India & Ors., delegated certain issues related to pet coke, to the Commission, inter alia observing that "... a holistic view would have to be taken as to the distribution of the Pet Coke available in the country and the Pet Coke required to be imported and how both of them should be distributed inter se the industries...".
4. The Commission vide its Order dated 25.10.2023 accordingly constituted a Sub- Committee comprising members from CAQM, Ministry of Environment, Forest and Climate Change (MoEF&CC), Ministry of Petroleum and Natural Gas (MoPNG), Ministry of Commerce and Industry (MoC&I), Director General of Foreign Trade (DGFT) and Central Pollution Control Board (CPCB) and National Environmental Engineering Research Institute (NEERI as co-opted Member). The Sub-Committee deliberated the issues in detail related to the distribution of the Pet Coke available in the country and the Pet Coke required to be imported and made its recommendations to the Commission.
....
NVSK, J 42 W.P. No.7538 of 2025
10. The observations, deliberations and recommendations made by the Sub-Committee were shared with the Commission members and the Commission approved the various recommendations of the Sub-Committee. The Commission, accordingly, in compliance of the directions of the Hon'ble Supreme Court hereby directs as under:
I. Import of RPC and CPC by Calciners / Aluminium Industry:
i. Import of total 1.9 MMT RPC for CPC Manufacturers and 0.5 MMT CPC for Aluminium Industry respectively shall be permitted during 2024-25 and 1.9 MMT RPC for Calciners and 0.8 MMT CPC for Aluminium Industry respectively from 2025-26 onwards, strictly subject to the following directions:
a. Use of pet coke shall be permitted only as a feedstock / raw material and under no circumstances to be used as fuel;
b. Import of pet coke (CPC / RPC) shall be permitted to cater entirely in the domestic needs of aluminium industry and other industries, for the processes as permitted under various regulations / statutes and export of calcined pet coke through such calcining units shall be discouraged. However, "deemed exports' to SEZ units would be permitted;
...."
NVSK, J 43 W.P. No.7538 of 2025
61. The Government of India, Ministry of Commerce & Industry Department of Commerce Directorate General of Foreign Trade, New Delhi, issued Notification No.68/2023 on 07.03.2024, in respect of "Amendment in Import Policy condition for Raw Pet Coke and Calcined Pet Coke under Chapter 27 of Schedule-I (Import Policy) of ITC (HS) 2022" to Condition No.06(b). Revised Policy Condition reads as under:
"Total import of 1.9 Million MTs of Raw Petroleum Coke (RPC) for manufacturing Calcined Petroleum Coke (CPC) and 0.5 Million MTs of CPC for Aluminium Industry respectively shall be permissible during 2024-25, and 1.9 Million MTs of RPC for manufacturing CPC Manufacturing and 0.8 Million MTs of CPC for Aluminium Industry respectively shall be permissible from 2025-26 onwards, subject to the following conditions:
i. Import of RPC & CPC shall be permitted only as a feedstock / raw material and under no circumstances shall be used as fuel.
ii. Import of RPC and CPC shall be permitted to cater entirely to the domestic needs of aluminium industry, for the processes as permitted under the relevant regulations / statutes.
iii. Import of RPC by Calciners shall be on Actual User basis and shall not be transferred to any other unit(s) including SEZ Unit(s). Export of CPC by Calciners shall not be permitted.
NVSK, J 44 W.P. No.7538 of 2025 iv. Import of CPC by Aluminium Industry shall be on Actual User basis. Export of Anode by Aluminium Industry shall not be permitted.
v. The RPC/CPC Processing capacity as on the date of the CAQM Order i.e. 15.02.2024 shall be taken on record for any pro-rata allocations. vi. All other conditions as mentioned in the Commission for Air Quality Management in NCR & Adjoining Areas Order No-F.No.160014/16/2021- MERD/PetCoke-35 dated 15.02.2024 should also be complied with."
62. Subsequently, authorisation for import of restricted item of Raw Petroleum Coke was granted to the petitioner on 05.04.2024 for quantity of 4,84,169.0 MTs. Thereafter, the petitioner was granted advance authorisation on 28.10.2024 to import duty free items for quantity of 34,999.995 MTs.
63. Similarly on 14.05.2024 another advance authorisation was granted to the petitioner to import duty free item of Raw Petroleum Coke for quantity of 81,000.000 MTs., and another advance authorisation dated 13.08.2024 was granted to the petitioner to import duty free Raw Petroleum Coke for quantity of 55,500.000 MTs., and the petitioner has accordingly given an undertaking for advance authorisation on 18.04.2024, 09.08.2024, 17.10.2024 and 31.12.2024.
NVSK, J 45 W.P. No.7538 of 2025
64. Thereafter, the respondents have issued a deficiency letter dated 15.01.2025 stating that "As per DGFT Notification No.68/2023 dt.07.03.2024, the revised policy condition 06.(b)(iii) import of RPC by calciners shall be on Actual use basis and shall not be transferred to any other unit (s) including SEZ unit(s). Export of CPC by calciners shall not be permitted."
65. In response to the said deficiency letter dated 15.01.2025, petitioner submitted explanation on 20.01.2025 as under:
"4.1. At the outset, we would like to inform you that RCCVL DTA Unit ("DTA Unit") received the allocation of Raw Petroleum Coke ("RPC") from the Director General of Foreign Trade (DGFT) as per revised policy condition 6(b)(iii) in Notification No.68/2023 dated 07.03.2024 issued under the guidelines prescribed by Commission for Air Quality Management (CAQM) order dated 15.02.2024 under the aegis of the Hon'ble Supreme Court of India (hereinafter referred to as "CAQM Order".
4.2. Accordingly, the DTA Unit has been importing / procuring the RPC on 'Actual User Basis' and not transferring any RPC to any other unit(s) including the SEZ Unit(s).
4.3. ....
4.4. ....
4.5. The Commission for Air Quality Management ("CAQM") in NCR and Adjoining Areas Order on Page 8 clearly states in the policy condition No.10.I.i.b that "... However, "deemed exports" to SEZ Units would be permitted." As NVSK, J 46 W.P. No.7538 of 2025 such, it can be kindly noted that the CPC export sales to the SEZ Unit located in India is permitted by both the CAQM and DGFT.
4.6. Accordingly, the aforesaid application for Advance Authorisation is meant for importing RPC, manufacturing CPC and to be supplied to Vedanta SEZ Unit, which is a 'Deemed Export' and categorically permitted by the said CAQM Order.
...."
66. Thereafter, the respondents have issued the impugned rejection letter dated 05.02.2025 without discussing the explanation given by the petitioner on 20.01.2025 and has referred the revised policy conditions in DGFT Notification dated 07.03.2024. However, has not considered the Clause 6(b) that all the conditions as mentioned in the Commission for CAQM dated 15.02.2024 should also be complied with. While referring to the orders passed respondent No.1, Office of the Additional Director General of Foreign Trade, Hyderabad, did not refer to the order of the Commission for CAQM that deemed export to SEZ units would be permitted.
67. At this juncture, it is necessary to refer to Chapter 4 of Foreign Trade Policy, 2023, which deals with Duty Exemption/Remission Schemes. For the facility, the relevant Clause 4.05 is extracted for reference.
NVSK, J 47 W.P. No.7538 of 2025 "4.05 Eligible Applicant / Export/Supply
(a) Advance Authorisation can be issued either to a manufacturer exporter or merchant exporter tied to supporting manufacturer.
(b) ....
(c) Advance Authorisation shall be issued for:
(i) Physical export (including export to
SEZ)
(ii) Intermediate supply; and/or
(iii) Supply of goods to the categories
mentioned in paragraph 7.02 (b)
(c), (d), (e), (f) and (g) of this FTP.
(iv) ...."
68. It is pertinent to note that in the Notification No.68/2023, dated 07.03.2024 the authorisation for restricted imports, condition No.3 that "Import of RPC by Calciners shall be on Actual User basis and shall not be transferred to any other unit(s) including SEZ unit(s). Export of CPC by Calciners shall not be permitted" is contrary to the orders passed by the CAQM, dated 15.02.2024 and also to Clause VI of the Notification dated 07.03.2024 and the Minutes of the Meeting held on 27.03.2024 for allocation for import of raw petroleum coke for CPC manufacturing and Calcined Petroleum Coke for Aluminium Industry for the Financial Year 2024-25 wherein at para 5 (ii) & (v) of the said meeting, which is relevant to the petitioner's case is extracted for reference.
NVSK, J 48 W.P. No.7538 of 2025 "5. Committee noted that pursuant to the recommendations of CAQM issued vide Order dated 14.02.2024, DGFT vide Notification 68/23 dated 07.03.2024 has notified that -
Total import of 1.9 Million MTs of RPC for manufacturing CPC and 0.5 Million MTs of CPC for Aluminium Industry respectively shall be permissible during 2024-25, subject to the following conditions:
i. Import of RPC & CPC shall be permitted only as a feedstock / raw material and under no circumstances shall be used as fuel.
ii. Import of RPC and CPC shall be permitted to cater entirely to the domestic needs of Aluminium industry (including Vedanta SEZ), for the processes as permitted under the relevant regulations / statues.
iii. Import of RPC by Calciners shall be on Actual User basis and shall not be treansferred to any other unit(s) including SEZ unit(s). Export of CPC by Calciners shall not be permitted. iv. Import of CPC by Aluminium Industry shall be on Actual User basis. Export of Anode by Aluminium Industry shall not be permitted.
v. All other conditions as mentioned in the Commission for Air Quality Management in NCR & Adjoining Areas Order No- F.No.160014/16/2021- MERD/PetCoke-35 dated 14.02.2024 should also be complied with."
NVSK, J 49 W.P. No.7538 of 2025
69. In view of the facts that the respondents earlier permitted the petitioner to export the CPC manufactured by it to SEZ Units and granted advance authorisations to the petitioners on 14.05.2024, 13.08.2024 and 28.10.2024, and in view of the preceding analysis there is no justification in issuing DGFT Notification No.68/2023 dated 07.03.2024 to the extent of revising the policy conditions i.e. 06(b)(iii) import of RPC by calciners and the said revised policy is not in consonance to the CAQM order dated 15.02.2024 passed in pursuance to the Hon'ble Supreme Court order in M.C. Mehta in W.P. (Civil) No.13029 of 1985 and the Minutes of the Meeting held on 27.03.2024, which is again in consonance to interpretation of policy under Chapter-II of General Provisions Regarding Imports and Exports of Foreign Trade Policy, 2023.
70. For reference, Clause 2.58 Interpretation of Policy is extracted hereunder:
"2.58 Interpretation of Policy
(a) The decision of DGFT shall be final and binding on all matters relating to interpretation of Policy, or provision in Handbook of Procedures, Appendices and Aayat Niryat Forms or classification of any item for import / export in the ITC (HS).
(b) A Policy Interpretation Committee (PIC) may be
constituted to aid and advice DGFT. The
composition of the PIC would be as follows:
(i) DGFT : Chairman
NVSK, J
50 W.P. No.7538 of 2025
(ii) All Additional DGFTs in Headquarters ;
Members
(iii) All Joint DGFTs in Headquarters looking
after Policy matters : Members
(iv) Joint DGFT (PRC/PIC) : Member Secretary
(v) Any other person / representative of the
concerned Ministry / Department, to be
co-opted by the Chairman."
71. Further, it is also to be noted that the impugned rejection letter dated 05.02.2025 has been issued without considering the explanation dated 20.01.2025 given by the petitioner to the deficiency letter dated 15.01.2024. As such, it is not a reasoned order.
In the case on hand, the change in the policy would cause genuine hardship and would have adverse impact on trade of the petitioner's company.
72. Further, since earlier the petitioner was granted three advance authorisations and the same are under review before the respondents' authority, this Court is of the considered opinion to pass the following directions.
73. In the light of the orders passed by the CAQM dated 15.02.2024, pursuant to the order dated 10.10.2023 passed by the Hon'ble Supreme Court in the case of M.C. Mehta in W.P. (Civil) No.13029 of 1985 and the Minutes of the Meeting held on 27.03.2024 the Deficiency Letter dated 15.02.2024 is contrary to the CAQM Order and the DGFT Notification which implements the CAQM Order.
NVSK, J 51 W.P. No.7538 of 2025 The petitioner has efficacious remedy of review under Section 16 of the Foreign Trade (Development and Regulation Act), 1992.
74. In view of the same, the impugned rejection letter dated 05.02.2025 bearing File No.09AX04000927AM25 and the Deficiency Letter dated 15.01.2024 bearing File No.09AX04000927AM25 are hereby set aside and the matter is remitted to the respondents authority for fresh consideration with respect to the petitioner's case to the extent of granting entitlement to advance authorisation under Foreign Trade Policy, 2023. The DGFT shall give personal hearing for petitioners' grievance.
75. For the aforesaid reasons and since the petitioners have already paid the duty on RPC on 29.03.2025, the respondents are directed to permit the petitioner to supply CPC to Vedanta SEZ.
76. It is also made clear that the petitioner's eligibility for advance authorisation is subject to the result of the review, which is already underway for the earlier Advance Authorisation pending to be decided by the respondents/appropriate authority.
77. Accordingly, with the above observations, this writ petition stands disposed of. There shall be no order as to costs.
NVSK, J 52 W.P. No.7538 of 2025 As a sequel, miscellaneous applications, if any pending, shall stand closed.
________________________________ JUSTICE N.V. SHRAVAN KUMAR Date: 02.05.2025 Note: L.R. copy be marked.
B/o.
LSK