TMI Blog1979 (8) TMI 206X X X X Extracts X X X X X X X X Extracts X X X X ..... nted provided all the shares of the petitioner Company are held by Indians. In pursuance of this direction from the Government on December 9, 1970, the petitioners converted entire share-holding and thereafter all the share-holders of the petitioner company are Indian citizens. 3. The Government of India declared its import policy for the year 1970-71 in respect of the exposed cinematograph films. The import of such films was allowed only through the S.T.C., New Delhi. The petitioners addressed a letter to the Joint Secretary, Ministry of Foreign Trade on December 24, 1970 for approval of agreement dated March 11, 1969 between the petitioners and the Crompton Group Limited and also sought permission to import feature films. The petitioners thereafter sent several reminders and ultimately on January 18, 1971, an agreement was arrived at between the petitioners and respondent No. 1-the Union of India-in regard to the import of films by the petitioners. A copy of the agreement is annexed as Ex. C to the petition and it sets out that the terms of agreement will apply to all films imported from U.K. through M/s. Crompton International Films Limited. The agreement between the petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. The petitioners claimed that the Government of India entered into an agreement in spite of the fact that on an earlier date, import policy regarding the cinematograph films was announced canalising the import of the films only through S.T.C. The petitioners contend that as the petitioners have altered their position, the Government of India is estopped by principles of promissory estoppel from refusing import licence during the subsistence of the agreement. The petitioners further claimed that the two orders rejecting their applications give no ground save and except that the films can be imported only through S.T.C. and this fact was known to the respondents even prior to January 18, 1971 when the agreement was entered into. 5. In answer to the petition, a return has been filed sworn by P. Govinda Raju on April 11, 1979. It is claimed by the respondents that the petitioners are not entitled to enforce the contract by adopting the present proceedings under Article 226 of the Constitution of India. It is also claimed that the agreement entered into by respondent No. 1 with the petitioners was void being opposed to public policy. The respondents also claimed that Rule 6(1)(c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riginal Side of this Court are drafted by experienced counsel with due care. Mr. Taraporewala submits that in view of these observations of the Supreme Court, the mere denial by the respondents of the averments made in paragraph 17(g) of the petition is not sufficient to hold that the petitioners have not altered their position. I am satisfied from the material on record that the petitioners did alter their position in view of the contract dated January 18, 1971. 7. Mr. Taraporewala then relied upon the decision of the Supreme Court in the case of M/s. Motilal Padampat Sugar Mills Company Ltd. v. The State of Uttar Pradesh and others - A.I.R. 1979 Supreme Court 621 and claimed that the doctrine of promissory estoppel has been held to be applicable against the Government and the defence based on executive necessity has been categorically negatived. The learned counsel relied on the observations of the Supreme Court set out in head note (6) and especially the following observations :- The doctrine of promissory estoppel has also been applied against the Government and the defence based on executive necessity has been categorically negatived. Where the Government makes a promi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Mr. Taraporewala relying upon this decision rightly contended that the doctrine of promissory estoppel clearly applies to the facts in the present case and the action of the respondents in denying the import-licence to the petitioner is untenable. The submission of the learned counsel is correct and must be upheld. Mr. Sethna, the learned counsel appearing on behalf of the respondents, contended that the doctrine of promissory estoppel is not applicable to the facts of the present case and no relief should be granted to the petitioners because they have not altered their position. The submission has no merit and for the reasons mentioned hereinabove, in my judgment, the petitioners have altered their position and the principle of promissory estoppel clearly applies. 8. Mr. Taraporewala then invited my attention to the two orders passed by respondent No. 2 rejecting the applications for grant of import licences and pointed out that the reason given in the first order dated February 9, 1972 is that the licence is denied because the films were to be allowed through S.T.C., while the reason for passing the second order dated July 6, 1972 is that there is no provision for impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use to grant a licence or direct any other licensing authority not to grant a licence :- * * * * * (c) if it has been decided to canalise imports and distribution thereof through special or specialised agencies or channels. Mr. Sethna contends that this Rule 6(1)(c) requires the respondent No. 2 to refuse import licence as the item of films was a canalised item. The submission has no merit and must be turned down. In the first instance, the item is not completely banned and Rule 6(1)(c) is merely regulatory or discretionary. There is no total prohibition to grant import licence. Moreover, what respondent No. 2 has clearly overlooked is that in spite of such canalisation of the item, the respondent No. 1 has entered into contract with the petitioners for import of films. It is futile for respondent No. 2, now, to urge that in spite of the contract, he is entitled to refuse import licence under Rule 6(1)(c) of the Import Control Order. Mr. Taraporewala is also right in contending that the rule is not a mandatory one but merely directory and the rule clearly sets out that respondent No. 2 may refuse the licence. In my judgment Rule 6(1)( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vested with statutory power. From these observations, it is clear that the petitioners can resort to a writ jurisdiction even if the right to relief arises out of an alleged breach of contract provided the action challenged was of a public authority invested with statutory power. It is not disputed that the orders which are challenged are of public authority invested with statutory powers and in view of this judgment, I have no hesitation in holding that the petition filed under Article 226 of the Constitution of India is perfectly maintainable. 12. It is not in dispute that even now the import of films is not a banned item and the petitioners can be granted relief in respect of that item. For the reasons stated hereinabove, in my judgment, the respondents have wrongful and illegally deprived the petitioners of their rights and the petitioners are entitled to the reliefs claimed in this petition. 13. In the result, the petition succeeds and the rule is made absolute in terms of prayer (b) of paragraph 23 of the petition. Mr. Taraporewala states that the respondents have refused to grant import licence even for the subsequent period for which the contract was subsisting ..... X X X X Extracts X X X X X X X X Extracts X X X X
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