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TMI Blog2015 (5) TMI 441X X X X Extracts X X X X X X X X Extracts X X X X ..... been denied the benefit of the said Yojana inter alia as a result of the impugned circular dated 28th February, 2006 on the principal grounds raised in the petitions. 3. The Petitioners are limited companies and doing the business of export of Menthol and Mentha Oil and the Respondents are the Union of India and Joint Director of the Foreign Trade and the concerned officers of the Director General of Foreign Trade (DGFT). 4. Few facts in the first petition may be adverted to prior dealing with the issue at hand :- The petition impugns an order dated 9th August, 2011 by which the Respondent No. 1 clarified that the Petitioners are entitled to benefits under policy circular dated 28th February, 2006 as a result of which, the Petitioners were permitted the benefit of the Yojana only from 1st April, 2007 as against 1st April, 2004 when the Yojana was first announced. According to the Petitioners, they are entitled to the benefit of export of Menthol and Mentha Oil exported even during the period from 1st April, 2004 to 31st March, 2007 by operation of law. 5. Before proceeding further, it would be appropriate that we examine the features of the Yojana which was intro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roducts for export w.e.f. 1st April, 2006; Forest based products for export w.e.f. 1st April, 2007 and Other products as notified from time to time. Such products to be listed in Appendix 37A of the Handbook of Procedures. 7. It is the Petitioners' case that under the Policy effective from 1st April, 2004, the Yojana initially provided for inclusion of items fruits, vegetables, flowers and minor forest produce. Thereafter, in each year the number of items covered by the Yojana was increased by amendment to the Yojana and the Appendix 37A to the Handbook of Procedures. Under the umbrella Policy for 2004-09, the Petitioners' products were covered by Appendix 37A under the general heading Mentha (Japanese pudina) Mentha Arvensis under product code 08.106 which classifies "Minor Forest Produce" at serial No.106. 8. Some of the other features of the Yojana are as follows : Under paragraph 3.8.3 of the Yojana duty credit may be used for import of inputs or goods including capital goods as may be notified provided the same is importable under ITC (HS). Paragraph 3.8.4 provided that additional custom duty/excise duty paid in cash or through debit under Vishesh Krishi Upaj Yoja ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t we may clarify that the dispute is restricted to whether the Petitioners' products are entitled for benefit from 1st April, 2004 under the general heading Mentha Arvensis although the products were for the first time notified under Appendix 37A under heading value added extract of herbs under product code 11.111, 11.112 and 11.113. All of these were described under the heading "value added products of Mentha" for the first time in the supplement of 2007-08. 12. It is the case of the Respondents that the Petitioners are not entitled to claim the said benefits with effect from 1st April, 2004 because according to the Respondents, the Petitioners' products of the herb Mentha were not notified under Appendix 37A under product code 08.106 or any other product code shown under head minor forest produce till the circular/notification was issued effective from 1st April, 2007. 13. Mr. Sridharan Learned Senior Counsel strenuously urged that the Petitioners' product, value added products of Mentha were already covered under product code 8 general description Mentha Arvensis. He submitted that Vishesh Krishi Upaj Yojana was part of the foreign trade policy itself. The trade poli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... including by categorising the value added extracts of herbs under product code 11 and which specifically includes value added products of Mentha only on or about 1st April, 2008 in the supplement to the Handbook applicable from 1st April, 2007, the Petitioners are entitled to the benefits commencing from 1st April, 2004. 17. A mere time gap in identifying different products and enlisting them in Appendix 37A does not alter the fact of policy which according to Mr. Sridharan is effective from 1st April, 2004. He further submits, apropos that the different dates of export which benefits will be admissible, namely, the date of 1st April, 2004 being commencement of the policy in licensing year 2004 and 1st April, 2007 the date from which the Respondents have now conceded such benefits to the Petitioners is discriminatory and violative of Article 14. No such cutoff date of 1st April, 2007 can be prescribed when policy came in effect from 1st April, 2004 and the general description of Mentha (Japanese Pudina) Mentha Arvensis (which included final value added products under Product code 11.111, 11.112 and 11.113) could be imposed. He thus challenges the imposition of cutoff date as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort market exists. These are two products. Apart from these two products the Petitioners has also indicated fractional distillation of Mentha oil. Mr. Desai controverts this contention by stating that the Plant itself is exported. He submits that what was permissible for export under Product Code 08.106 was the physical plant itself which is described as Mentha Arvensis. Mr. Desai contends that Mentha Arvensis plant is also exported as a whole. 21. Mr. Desai then sought to rely upon meaning of "mentha arvensis" to mean "mentha plants which grew in fields". He therefore submitted that the expression "mentha arvensis" mentioned in the policy refer to plant and not value added product which were subsequently notified by way of clarification that with effect from 1st April, 2008 eligibility for effect from 1st April, 2007. Mr. Desai further submitted that from the shipping bills enclosed by the Petitioners along with the letter dated 8th December, 2008 addressed to Joint Director General of Foreign Trade the Petitioner had sought benefits by describing the product exported under the heading item description Mentha, Japanese Pudina, Linn, Mint, Pudina. This according to Mr. Desai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly. It is only after the Petitioners' product were specifically included under Product Code 11.111, 11.112 and 11.113 that they became eligible for the benefits. The Petitioners products are covered under Appendix 37A under the following description : Value Added Extract of following Herbs Sr. No. VKGUY Product ITC HS Code Description of Herbs Date of export from which benefits will be admissible Botanical Name Other names (1) --- --- --- --- - (2) --- --- --- - - (3) --- --- - - - (111) 11.111 - Menthol BP/USP 1-4-2007 (112) 11.112 Menthol Crystal BP/USP 1-4-2007 (112) 11.113 Menthol Oil IP 1-4-2007 (113) 11.114 Menthone 1-4-2007 25. According to the Respondents it was decided to initially exclude the value added variants from the scope of Yojana as the revenue on this count would be very high. According to the Respondents the revenue outgoings on account of exports of Mentha would have been very high on account of export value being of Rs. 2,300 crores during period 2004-05 and 2006-07 it is only when the revenue of Vikas Yojana was incr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ption of 'Mentha Arvensis, Linn (Mint, Pudina)'. 29. Suffice it to say that the Jt. D.G.F.T. held that such export product is not covered under this entry and even though in respect of some applications, had granted export benefit, after the issuing clarification by policy circular dated 28th February, 2006, recovery had been initiated. The issue before the D.G.F.T. was only to decide as to whether the product exported by the petitioner is eligible for grant of export benefit as on that day and up to 1st April, 2007. The Petitioner had then pleaded that Mentha in its natural form is not exported neither is it exportable in that form and, therefore, the intention was to incentivise the export of mentha oil or mentha crystals. If that was the case, it was held that there would have been no need to amend Appendix 37A and bring in specific lists of value added product for Mentha. It was held that in view of the clarification, the Petitioner will not get the benefit of Vishesh Krishi Upaj Yojana announced in 2004-05. They will get the benefit with effect from 1st April, 2007. 30. We are in agreement with the contentions of the Respondents to the extent that inclusion of valu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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