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TMI Blog2007 (12) TMI 301X X X X Extracts X X X X X X X X Extracts X X X X ..... ssal 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 the Statement of objections of Respondents 1 and 2, it is contended that export of textiles and clothing from India is based on bilateral agieements entered into between Government of India and Governments of developed countries under the aegis of the erstwhile Multi Fibre Arrangement (MFA) governing international textile trade from the year 1974. The Textile Importing countries are referred to as "Quota countries" who have placed restraints on import of specified textile categories "Quota items" within the annual levels prescribed in the bilateral agreement and that the coming into force of the World Trade Organisation (WTO) in 1995, quantitative restrictions known as "Import quotas" in the bilateral agreements were changed under the WTO relating to Agreement on Textiles and Clothing (ATC). The quotas also known as export entitlements are allocated amongst individual exporters, for which sy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 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 utilization. If an exporter is aggrieved by any order of forfeiture, it could maintain an appeal to the First Appellate Committee and thereafter to a Second Appellate Committee. The Appellate Committees rejected the petitioner's claim of force-majeure, as no relevant material constituting substantial legal evidence of the fact that failure to fulfil the export obligation was due to acts beyond the control of the exporter. It is further stated that during the pendency of appeals, the practice is not to effect any recovery and therefore, it is profitable for exporters to delay the recovery as long as possible since no interest clause is provided in the quota policy. 3. The Statement of objections of the 3rd respondent raises almost identical contentions as are advanced by Respondents 1 and 2 in their Statement of obj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 Images Limited v. Union of India, a learned Single Judge of the High Court of Delhi, rejected the plea in the decision reported in 2007 (7) S.T.R. 347 (Del.) = 2006 (193) E.L.T. 264 (Del.). Learned Senior Counsel, in addition, contends that the petitioner having not laid relevant material constituting substantial legal evidence of a claim of force-majeure, the authorities rightly considered and rejected the said plea. Lastly it is contended that the petitioner having exported garments upto 84.37% of the total export quota allotted, the authorities were well within their powers to direct forfeiture of the amounts in bank guarantee, in proportion, to the extent of non-exported quota. 6. Sri Devadass, learned Senior counsel for Respondents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se 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 instance of the petitioner who filed applications to permit it to export garments for the balance of the quotas on or before 31st of December and voluntarily furnished a bank guarantees, inter alia, covenanting that in case of failure to fulfil the export obligation, in its entirety, would be subject to sub-clause 'F' of Clause 8 of the 'Policy'. The petitioner consciously agreed to the terms of the policy that if it exported garments beyond 75% upto 90% of the quota, it would be liable for proportionate forfeiture and if less than 75%, forfeiture would be in full, from out of the amount in the Bank guarantee. The consent of the petitioner to be subjected to the terms of the policy, more a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... igation 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 application. For obvious reasons, granting of licences depends upon the policy prevailing on the date of the grant of the licence or permit. The authority concerned may be in a better position to have the overall picture of diverse factors to grant permit or refuse to grant permission to import or export goods. The decision, therefore, would be taken from diverse economic perspectives which the executive is in a better informed position unless, as we have stated earlier, the refusal is mala fide or is an abuse of the power in which event it is for the applicant to plead and prove to the satisfaction of the Court that the refusal was vitiated by the above factors. 5. It would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 order discloses that the chart showing daily rainfall for Coimbatore as recorded by the Meteorological Department for Coimbatore and Salem during December 1998 discloses heavy rainfall on the 11th and thereafter no rainfall for the remaining days in the month while for Salem, there was rainfall on 10th and no rainfall thereafter. In that view of the matter, the Appellate Authority declined to accept the explanation of the petitioner that non-supply of the fabric was due to incessant rains. Even otherwise, relevant material that is to say the documents relating to purchase orders, invoices the quantity of material supplied before 30th September and the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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