Madras High Court
M/S.L & T Valves Limited vs Office Of Zonal Director General Of ... on 10 February, 2020
Author: C.V.Karthikeyan
Bench: C.V.Karthikeyan
W.P.No.21447 of 2019
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED 10.02.2020
CORAM
THE HONOURABLE MR. JUSTICE C.V.KARTHIKEYAN
W.P.No.21447 of 2019 and
WMP Nos.20652 and 20654 of 2019
M/s.L & T Valves Limited
Represented by its Managing Director,
No.976, Mount Poonamallee Road,
Manapakkam, Chennai – 600 089. .. Petitioner
..Vs..
1. Office of Zonal Director General of Foreign Trade,
Chennai, represented by its
Assistant Director General of Foreign Trade,
Government of India,
Ministry of Commerce and Industry,
4th Floor, Shastri Bhawan Annexe,
26, Haddows Road, Chennai – 600 006.
2. Director General of Foreign Trade,
Represented by its Director General,
Government of India,
Ministry of Commerce and Industry,
Udyog Bhawan, H-Wing, Gate No.2,
Maulana Azad Road, New Delhi – 110 011.
3. Union of India,
Represented by its Secretary,
Department of Commerce,
Ministry of Commerce and Industry,
Udyog Bhawan, New Delhi – 110 107. ..Respondents
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W.P.No.21447 of 2019
PRAYER : Writ Petition filed Under Article 226 of the Constitution of India
praying to issue a Writ of Certiorarified Mandamus, to quash the impugned
rejection letters totaling one hundred and fifteen (115) issued between
27.11.2018 and 09.04.2019, as detailed in Schedule attached herewith, in light
of the Supreme Court order dated 03.10.2017 read with Supreme Court Review
Order dated 08.05.2018 and the Gujarat High Court Judgment dated
13.10.2016 and consequently issue appropriate orders and/or directions to the
1st respondent to issue the Focus products Scheme benefit to the petitioner
company in relation to the applications submitted by petitioner Company
between 20.08.2018 to 31.12.2018 with the 1st respondent and within a time
period as may be directed by this Court.
For Petitioner : Mr.Aravind Pandian,
Advocate General for
Mrs.Hema Srinivasan
For Respondents : Mr.M.Ramesh
ORDER
The writ petition has been filed in the nature of Certiorarified mandamus to quash the impugned rejection letters, totally 115 letters, issued between 27.11.2018 and 09.04.2019.
2. The writ petitioner is a company incorporated under the Companies Act, 1956 and claims to be a manufacturer-exporter of industrial valves and 2/12 http://www.judis.nic.in W.P.No.21447 of 2019 parts thereof/other accessories with a significant part of its revenue coming from exports. It has been claimed that the petitioner has also been granted Importer Exporter Code (IEC) Number 0488005043 on 24.05.1988 under Section 7 of the Foreign Trade (Development and Regulation) Act, 1992. The petitioner claims that the Central Government in exercise of its power under Section 5 of the Foreign Trade (Development and Regulation) Act, notified the Foreign trade Policy, 2009-2014 with effect from 27.08.2009.
3. In the present case, the petitioner is involved with the Foreign Trade Policy with respect to Additional items/markets for incentives. According to the learned Senior counsel, the petitioner company is agreed with Item Code 8481 which is as follows:
“Items of a kind used on Bicycles:
Taps, Cocks, Valves and similar appliances for pipes, Boiler Shells, Tanks, vats or the like, including pressure reducing valves and thermostatically controlled valves.”
4. The time period for application for such concession is given as follows:
3.11.9. Applications for obtaining Duty Credit Scrip shall be filed within a period of twelve months from the date of export or within six months form the date of realization or three months from the date of printing /release of shipping bill, 3/12 http://www.judis.nic.in W.P.No.21447 of 2019 whichever is later, in respect of shipments for which claim is being filed. Further, for shipments already made prior to the inclusion/modification of the items/markets in relevant appendices by various Public Notices issued from time to time;
the last date for filing applications shall be six months from the end of the month of the relevant Public Notice that included/notified the items/markets, or the time period permitted in the first sentence of this Para, whichever is later.
5. It is thus seen that a specific period of time limit has been granted for the said concession. The petitioner did not abide with seeking the said concession.
6. On the other hand, the learned Senior counsel for the petitioner placed reliance on the challenge made to the entry itself namely the rejection of a concession of sanction that has been challenged before the Gujarat High Court. The Gujarat High Court had gone extensively into the issue in the Special Civil Application Nos.11262, 11263, 11264 and 14808 of 2016 instituted by Intolcast Private Limited and another Vrs Union of India and another. The issues raised before the Gujarat High Court were also with respect to the challenge of the Trade Notice No.11 of 2015 dated 14.12.2015 issued by the Government of India. Even in that case, the petitioners therein were engaged in manufacturing and exporting engineering goods like Casting, valves, parts of 4/12 http://www.judis.nic.in W.P.No.21447 of 2019 valves etc.,.
7. The Government of India had framed Foreign Trade Policy 2009-14. That Policy is the subject matter issue even before this Court now.
8. In the said Policy, the Focus Projects Scheme was introduced by the Government of India. The products envisaged granting of duty credit scrip equivalent to 2% of the FOB value of exports of notified products into the products including items of use on bicycle and also taps, Cocks, Valves and similar appliances etc., It is again to be mentioned that the petitioner had not availed the said concession within the limitation period fixed under paragraph 3.119 cited supra which gave a six month time period from the date of realization or from the date of release of shipping bill which ever was later. It has also been stated that where there are inclusions, modification of items then there is a period of seeking 6 months for seeking concession. The words are clear.
9. Since a challenge before the Gujarat High Court was made with respect to denial of the concession to other items namely Taps, Cocks, Valves and other aspects, it is claimed by the learned Senior counsel that the the period of limitation would arise from the period when such public notice was 5/12 http://www.judis.nic.in W.P.No.21447 of 2019 issued.
10. In the present case, the learned Senior counsel points out that in the Trade Notice No.16 of 2018 dated 07.06.2018, the Director General of Foreign Trade had clarified that in the writ petition filed before the Gujarat High Court, it was clarified that not only bicycles, but also taps, Cocks and other items are eligible for concession. That Judgment of the Gujarat High Court was also been challenged before the Supreme Court by way of an appeal and the Hon'ble Supreme Court had also dismissed the same. A Review Petition of the appeal had also been dismissed by the Hon'ble Supreme Court. Thereafter the 2nd respondent had withdrawn the Trade Notice No.11 of 2015 dated 14.12.2015 vide Trade Notice NO.16 of 2018 dated 07.06.2018. By withdrawal of the Trade Notification, the issue which is now to be decided is whether there has been inclusion or modification of the items. In the Trade Notification No.11 of 2015, dated 14.12.2015, the following items had been notified:
“Items of a kind used on Bicycles:
Taps, Cocks, Valves and similar appliances for pipes, Boiler Shells, Tanks, vats or the like, including pressure reducing valves and thermostatically controlled valves.”
11. It has been stated that a representation had been received from the 6/12 http://www.judis.nic.in W.P.No.21447 of 2019 exporters to extend the Foreign Trade Policy 2009-2014 for export of industrial valves also.
12. The present petitioner is directly interested in the Focus Products Scheme for export of valves. It must be noticed that the petitioner is not in the manufacture of any item used in bicycles. They are involved with export of valves. Therefore, when under the Trade Notice No.11 of 2015, it had been stated that there are no merits in claiming exemption for any other items apart from items used on bicycle which Trade Notification had been clarified in Trade No 16 of 2018 dated 07.06.2018, the clarification actually clarifies the earlier stand that valves and such other items were not eligible for concession by Trade Notification No.11 of 2015.
13. It is thus seen that there is an inclusion of valves and other items which have been directly exported by the petitioner. Therefore, the petitioner can take advantage of the Trade Notice No.16 of 2018 and their period of limitation would be within six months from 07.06.2018. These applications have been rejected by the respondents with a one line order i.e., “it is time barred”. Rejections have been placed before this Court.
14. The learned Standing Counsel for the respondents justified the said 7/12 http://www.judis.nic.in W.P.No.21447 of 2019 rejection stating that a new starting period of limitation cannot be envisaged by the petitioner. According to the learned counsel, the petitioner herein has not even applied seeking concession in the first instance. Thereafter, the learned counsel also stated and it is also mentioned in the counter affidavit that they have not even applied from the date of the Judgment of the Supreme Court. It is further stated that the period of limitation cannot be granted for the petitioner.
15. The petitioner, as a manufacturer of Valves and such other items, for export them, claimed the benefits under Duty Scrip under the Focus Product Scheme of FTP 2009 – 14. The Trade Policy as on the date as extracted above was for all parts of the bicycle.
16. There were several representations by various exporters for inclusion of valves and such other items. But they were specifically rejected by the respondents. Thereafter this reject was challenged before the Gujarat High Court wherein the Division Bench of Gujarat High Court clarified the aspect and struck out the rejections. The petitioners before the Gujarat High Court became entitled for such concession.
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17. The petitioner in this writ petition is directly interested in the ratio of the Judgment of the Gujarat High Court. A challenge was taken up before the Hon'ble Supreme Court but the Hon'ble Supreme Court has rejected the appeal and also dismissed the Review Application.
18. When the appeal has been rejected, a duty was cast on the respondents to issue a further Trade Notice, by withdrawing the earlier Trade Notice. By the earlier Trade Notice, it had been mentioned that valves and other such items are not permissible for seeking export concession. Now by the third notice, they have specifically stated that such items are also eligible for concession in toto. Though on paper, there is no addition or modification, there has been a substantial change in the Policy. Therefore, the petitioner is well within their rights to seek a concession within a period of six months from the date of the Trade Notice. The rejection of the respondents on the ground that the applications are “time barred” cannot stand the scrutiny of this Court. The petitioner seeks a concession which the respondents have extended by issuing a third notice, stating that valves and such other items are also eligible for concession. That Trade Notice was issued only on 07.06.2018. Well within the period of six months, the petitioner had made applications seeking concession. Still the respondents had rejected the same as time barred, that 9/12 http://www.judis.nic.in W.P.No.21447 of 2019 order will have to be necessarily interfered with.
19. With the above observation, the writ petition is allowed. The respondents are directed to reconsider the application already filed and they are otherwise in order, consider the same by merits. Consequently, connected Miscellaneous Petitions are closed. No costs.
10.02.2020
vum
Index : Yes / No
Speaking order/Non speaking order
To
1. Office of Zonal Director General of Foreign Trade, Chennai, represented by its Assistant Director General of Foreign Trade, Government of India, Ministry of Commerce and Industry, 4th Floor, Shastri Bhawan Annexe, 26, Haddows Road, Chennai – 600 006.
2. Director General of Foreign Trade, Represented by its Director General, Government of India, Ministry of Commerce and Industry, Udyog Bhawan, H-Wing, Gate No.2, Maulana Azad Road, New Delhi – 110 011.
3. Union of India, Represented by its Secretary, 10/12 http://www.judis.nic.in W.P.No.21447 of 2019 Department of Commerce, Ministry of Commerce and Industry, Udyog Bhawan, New Delhi – 110 107.
C.V.KARTHIKEYAN.J, vum W.P.No.21447 of 2019 11/12 http://www.judis.nic.in W.P.No.21447 of 2019 10.02.2020 12/12 http://www.judis.nic.in