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2025 (7) TMI 1092 - HC - CustomsPartial cancellation of Merchandise Exports Incentive Scheme (MEIS) scrip to the extent of excess amount availed by the licensee - cancellation of MEIS scrips by exercising jurisdiction under Section 9(4) of FTDR Act r/2 Rule 10 of the Foreign Trade (Regulation) Rules 1993 - fulfillment of the requirements of the relevant provisions before the retrospective cancellation of the scrips - proper application of mind on the grounds raised by the petitioners while rendering the findings by assigning proper reasons - violation of principles of natural justice. HELD THAT - It will be relevant to take note of Section 9(4) of the FTDR Act which deals with suspension or cancellation of scrip by the Director General or the Officer authorised subject to such conditions as may be prescribed for good and sufficient reasons to be recorded in writing. The conditions as may be prescribed is traceable to Rule 10 of the Foreign Trade Regulations Rules 1993. If at all any scrip is sought to be cancelled in exercise of Section 9(4) of the FTDR Act it can only be done if the case falls within any of the requirements under Rule 10 - There is total lack of reasoning on the part of the Appellate Authority and the findings of the Appellate Authority does not reflect any application of mind. The Appellate Authority does not even render a finding as to which requirement under Rule 10 has been satisfied. It is an admitted case that the first scrip was issued on 28.02.2016 and the last scrip was issued on 02.06.2021 for exports made upto October 2019. These scrips are valid for a period of 24 months and the same is evident from para 3.13 of the handbook of procedures. Even the last scrip issued during the relevant period had expired on 01.06.2023. However the action for cancellation of scrips was initiated by the Deputy Director General of Foreign Trade only on 25.08.2023 when the show cause notice was issued. Hence an attempt was made to retrospectively cancel the scrips. The alleged contravention against the petitioners does not pertain to the law relating to customs or foreign exchange or the rules and regulations made thereto. It is a clear case of contravention of a foreign trade policy. The question is whether it will come within the scope of Rule 10 (d). This is in view of the fact that this Court has already concluded that Rule 10(a)/(b)/(c) has not been satisfied in this case. This Court has also extracted the findings of the Appellate Authority which is bereft of reasons and clearly reflects non-application of mind. Since the Appellate Authority has not applied its mind and stated the reasons as to how the order is sought to be justified in line with Section 9(4) of the FTDR Act r/w Rule 10 of the Foreign Trade (Regulation) Rules 1993 this Court does not want to substitute its mind and assign reasons in the place of the Appellate Authority. Hence this Court is inclined to remand the matter back to the file of the 1st respondent to enable the authority to apply its mind based on the findings/observations. The impugned order passed by the Appellate Authority viz. the 1st respondent in all these writ petitions is hereby quashed and the matter is remanded back to the file of the 1st respondent to deal with the appeal on its own merits and in accordance with law - Petition allowed by way of remand. ISSUES:
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