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5. The relevant facts are that in the year 1982 RCF floated global tender for supply of various types of capital goods required for its Thal project. In response to the said tender, the petitioner submitted its quotation for supply of thermocouple compensating cables and extension cables. The quotation submitted by the petitioner was accepted by RCF and by a purchase order dated 13th October, 1982 RCF agreed to purchase cables worth Rs.17,49,000/- from the petitioner.

6. With a view to import raw materials required in the manufacture of capital goods to be supplied to RCF, the petitioner applied to the Joint Chief Controller of Import & Export, Bombay ('JCCI' for short) on 22/11/82 seeking a licence under the duty exemption scheme along with the prescribed form duly filled in. As the petitioner was not clear as to which licence would entitle it to import raw materials at concessional rate of duty or under duty exemption scheme in terms of Notification No.210/82-customs dated 10/9/82, the petitioner enclosed along with the said letter, applications addressed to the Advance Licensing Committee as well as the Special Imprest Licensing Committee at New Delhi with a request to the JCCI to forward the applications to the concerned cell so that appropriate licence is issued, on the basis of which the petitioner could import raw materials at concessional rate or under duty exemption scheme and on manufacture, supply the resultant product to RCF.

7. On processing the application made by the petitioner, the office of JCCI, Bombay by a letter dated 30th November, 1982 called upon the petitioner to furnish essentiality certificate from the RCF. Accordingly, the petitioner obtained an essentiality certificate from the project authority i.e. RCF to the effect that they have agreed to purchase goods valued at Rs.17,49,000/-from the petitioner for their Thal Project under the global tendering procedure and that the Thal project is fully financed by the Government of India. In that certificate issued by RCF it was further stated that the petitioner is eligible to import raw materials required for the manufacture of equipments to be supplied to it at the concessional rate of duty. The petitioner forwarded the said certificate to the Jt. C.C.I., Bombay.

11. After fulfilling the export obligation, the petitioner approached the project authority namely the RCF seeking requisite endorsement on the Duty Exemption Entitlement Certificate ('DEEC' for short). Initially RCF declined to make endorsement on the ground that the Thal project is financed by the Government of India and not by organisations like World Bank, OECF, ADB, etc. as contemplated under Exemption Notification No.210/82 dated 10/9/82. However, lateron, RCF made requisite endorsement on the DEEC book on 2/2/88 (Exh.H) to the effect that the petitioner has supplied goods valued at Rs.17,59,382/-during the period from 27/7/83 to 10/5/84.

11. The appellants may have mis-comprehended the policy in force. But, they did not object when the special imprest licence under reference was granted to them under the deemed export category with specific export obligation with reference to 100% duty free imports. Since they accepted the conditions of the licence and also executed a bond to abide by the conditions of the licence which carried an export obligation, it was incumbent on them to complete formalities in support of their contention of having discharged export obligation notwithstanding that the imported goods were utilised for the execution of the project. The project they executed or supplied they made towards the execution of the RCF, Thal Project was not a project falling under the category of deemed exports. This project was not aided by IDA/IBRD. Their request for conversion of their supplies to RCF, Thal Project in the deemed category of exports was duly considered by the competent authority in the Import Trade Control Organisation. Under letter dated 30.10.1985, their request was not considered as the supplies made by them to RCF, Thal Project were not covered under the category of deemed exports. They were advised to convert the special imprest licence into project import licence by paying the customs duty with penal interest thereon with the consent of Ministry of Finance. But they did not do so considering the fact that the appellants mis-understood the provisions of the policy in force and that there was no malafides on their part, I am inclined to take a lenient view. In exercise of powers vested in me under Clause -10(3) of the Imports (Control) Order, 1955, I hereby reduce the period of debarment upto 31.3.1989. The Order-in-Original No.F-5/22/86/ECA/ BOM dated 4.5.1987 passed by the Deputy Chief Controller of Imports & Exports, Bombay, accordingly stands modified to this extent. The second appeal is partially allowed.