TMI Blog2007 (12) TMI 301X X X X Extracts X X X X X X X X Extracts X X X X ..... Co., Advocate, K.S. Harish, V.S. Arbatti and R. Kiran, Advocates, for the Petitioner. S/Shri Kuljeet Rawal, Senior Counsel, K. Sachindra Karanth, K. Shrihari, N.R. Bhaskar, ACGSC, Y. Hariprasad and N. Devadass, Advocates, for the Respondent. [Order]. The petitioner, a manufacturer/garment exporter when allotted export entitlements under New Investors Entitlement, Non-quota Transfer, Past Performance Transfer, quota in country category US-3410, US/342, US/2GR, EU/8, EU/27, CA/2GR during the year 1998, in terms of the Government Export entitlement policy 1996-1998 for short Policy , exported 84.37% of the entitlement, resulting in the 3rd respondent Apparel Export Promotion Council (for short AEPC Bangalore, forfeiting Rs. 36,10,378/- by order dated 17-12-1999 Annexure- C , confirmed in First Appeal by order dated 12-2-2002 Annexure- D of the First Appellate Authority and dismissal of the Second Appeal by order dated 14-9-2002 Annexure- E of the Second Appellate Committee. Hence, this writ petition, 2. Petition is opposed by filing Statement of objections dated 7-1-2003 of the 3rd respondent and Statement of objections dated 1-6-2004 of Respondents 1 and 2. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s said, vastly over strips the demand and in view of the restricted availability, commands a premium. Major importers of textile garments being the quota countries, it is essential to ensure quotas are fully utilised and are not allowed to go waste due to speculative trading by unscrupulous elements and therefore, the policy envisages utilisation of the quota by 30th September of the relevant year and failure to do so, the exporter is required to surrender the quota and seek revalidation of unutilised quota allocated in the categories, in the manner and procedure as laid down in the policy. Revalidation of quota beyond 30th September and upto 31st December of the relevant year is in the form of a Bank guarantee or a fixed deposit receipt or Demand Draft while the policy in operation till the year 2000, star exporters cover the amount of EMD by a letter of undertaking or post dated cheques. The condition imposed for revalidation is that an exporter who exports not less than 90% of the export entitlement, its EMD shall be released in full. In case of utilisation upto 75% of fast moving items and upto 50% in case of slow moving items, EMD is forfeited in proportion to the shortfall of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... force-majeure, cannot refuse to extend the very same relief in the fact situation of this case. 5. Per contra, learned Senior Counsel Sri G.L. Rawal for Respondent No. 3 contends that the challenge to the policy is unavailable to the petitioner as the garments exported having fallen short of the quota allotted to it within the period stipulated, that is 30-9-1998, voluntarily sought for revalidation of the entitlement beyond 30th September up to 31st of December, by filing an application in the required proforma XII to the policy, and a Bank guarantee in the proforma Annexure-VI to the policy. According to the learned Senior counsel, in terms of the policy, the petitioner was fully aware of the consequences of proportionate forfeiture of Bank guarantee on failure to export garments upto 90% but not less than 75%, and forfeiture in full if less than 75%. Petitioner having accepted the terms of revalidation, it is argued, cannot be heard to contend that the policy in so far as it relates to forfeiture is either irrational or unreasonable. Learned Senior counsel further contends that an identical contention over the validity of the policy, when advanced, in the case of Gokaldas Ima ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AEPC issued a notice calling upon the petitioner to show cause as to why action should not be taken to forfeit the monies from out of bank guarantee, which was responded to by the petitioner. The AEPC, not being satisfied with the explanation offered, forfeited Rs. 36,10,378/ calculated in proportion to the percentage of non-exported quota, from out of the amounts in the bank guarantee, by order dated 17-12-1999 Annexure- C . This order when carried in appeal before the First Appellate Committee, was confirmed by order dated 12-2-2002 Annexure- D . So also, the Second Appellate Committee dismissed the petitioner s appeal by order dated 14-09-2002 Annexure- E . 8. In the admitted facts noticed supra, the questions that arise for decision making are : (i) whether the challenge to the policy in so far as it relates to forfeiture, for non-fulfilment of the export obligation within 31st of December of the relevant year, is sustainable? (ii) whether the AEPC and the Appellate Committees, were justified in rejecting the petitioner s claim of existance of force-majeure conditions? 9. Indisputably, the revalidations of the quotas allotted to the petitioner was at the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exercise of their jurisdiction, will not transgress into the field of policy decision, as they are ill equipped to adjudicate on a policy decision. The court, no doubt has a duty to see that in the undertaking of a decision, no law is violated and people s fundamental rights are not transgressed upon except to the extent permissible under constitution. 11. In almost identical circumstances, a learned single Judge of this Court in the case of Gokaldas Images Limited v. Union of India in W.P.No. 8539/2003 and connected writ petitions, by order dated 12-3-2003, repelled the contention that the policy providing for forfeiture and imposition of penalty for non-fulfilment of the obligation under the export quota could be challenged by an exporter who had had the benefit of a policy, following the decision of the Apex Court in the case of PTR Exports (Madras) Pvt. Ltd. and others v. Union of India and Others reported in AIR 1996 SC 3461 = 1996 (86) E.L.T. 3 (S.C.), in the matter of interference by writ courts with policy matters, by observing thus : 4. An applicant has no vested right to have export or import licences in terms of the policies in force at the date of his making appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orfeiture of EMD will be subject to Force-Majeure conditions which are established with documentary evidence, which would be considered by the Appellate Authority. 14. From the above, what is discernible is that in the event the petitioner is unable to fulfil the export obligation of 100% of the quota allotted, resulting in forfeiture of the bank guarantee, the Appellate Authority is required to consider and pass orders by taking into account documents placed by the petitioner in support of the plea of force-majeure. 15. In the instant case, petitioner claims to have received letters Annexures B1 , B2 and B3 , from the suppliers of fabrics expressing their inability to supply the fabric due to incessant rains in Tamilnadu. In addition, petitioner states that it placed before the authority a certificate Annexure- B4 of the Meteorological Department and press clippings Annexure- B5 series relating to water logging in Chennai on account of incessant rains on 8th, 9th and 10th of December, 1998. It is not disputed that the Appellate Authority took into consideration this material and rejected the same in its order dated 12-2-2002 Annexure- D . An examination of the said orde ..... X X X X Extracts X X X X X X X X Extracts X X X X
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