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2016 (2) TMI 577

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..... planation offered by the respondents as to the reason and rationale in adopting a prescription of a provisional cap and a country cap, in so far as the imports from Turkey is concerned, is also acceptable. Hence, the petition lacks merit and is hereby dismissed. - Writ Petition No. 42816 of 2015 (GM-RES) - - - Dated:- 5-1-2016 - Anand Byrareddy, J. For the Appellant : Shri Jeevan J Neeralgi, Central Government Standing Counsel For the Respondent : Shri Prabhulinga K Navadgi, Senior Adv. for Shri Chandan, Adv ORDER The petitioner is said to be a registered dealer under the Karnataka Value Added Tax Act, 2003 (Hereinafter referred to as the 'KVAT Act', for brevity). The petitioner is said to be issued a Certificate by the Joint Director General of Foreign Trade. The petitioner is said to be a dealer in spices, pepper and other food items. The Certificate obtained as aforesaid enables the petitioner to import the said commodities. It is stated that in the course of his business, the petitioner sought to import 180 tonnes of poppy seeds from Turkey on the basis of a contract entered into with their overseas suppliers dated 31.7.2015. It is stated that t .....

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..... e will also need to inform the ports when the cap for any particular country is reached so that no further imports from the said country take place from any port. b) For the FY 2014-15 onwards, the following steps will be taken by the Narcotics Commissioner: I. He will determine the exportable surplus of the exporting countries of poppy seeds so as to arrive at the country caps. II. Poppy seeds import contracts will be registered on first come first served basis, till the caps for the respective countries is reached. III. The import contracts will be valid for only 3 months. If the quantity mentioned in the contract is not imported in this period, or only partly imported, the said quantity or the balance quantity will be released and can be allotted to other importers, again on first come first served basis. IV. The Narcotics Commissioner will seek the country of origin certificate, even at the time of registering of import contracts. c) Receipt of this communication may please be acknowledged. Pursuant to the above, a public notice dated 29.5.2014 was said to have been issued by respondent no.1 approving the extension of validity for contracts, which were val .....

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..... lling for applications for registration of sale contracts for import of poppy seeds from Turkey and it was indicated that applications would be accepted upto a limit of 18594 metric tonnes as fixed. It was also indicated that applications received after the above limit was met would be returned. It is claimed that the above notice dated 10.8.2015 was issued after office hours on that day and hence, the petitioner had responded to the same at the earliest, namely, on 11.8.2015. The petitioner's application had been shown to have received by the respondents at Gwalior on 14.8.2015. By a public notice dated 18.8.2015, Respondent no.4 had tabulated the applications received and the petitioner seeks to highlight that from the list, it is seen that 22 applications were received within 18 hours of the issuance of the public notice dated 10.8.2015. This according to the petitioner is a physical impossibility. And further the petitioner's application does not find mention in the list. It is stated that the above action of favouring particular applicants in a shady fashion was sought to be questioned by another importer, before this court in a writ petition in WP 36202/2015. .....

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..... r exhausting the quantity earmarked for category-A. This according to the petitioner clearly would encourage cartels of importers who would monopolize the trade indefinitely as the Category-B importers are those who may have never imported earlier and would indefinitely remain outside the zone of consideration. It is pointed out that the present policy adopted by the respondents, allows persons who had imported poppy seeds in the past, falling under Category-A to register sales contract for a quantity of 270 MT as against persons falling under Category -B, who are said to be eligible to register a sales contract only for a quantity of upto 180 MT. It is also pointed out that the public notice dated 14.9.2015 also contemplates that in the event the quantity available for allocation is insufficient, selection of applicants would be through draw of lots. This procedure is what was frowned upon by this court as well as by the Madras High Court in having granted interim orders earlier, as stated above. It is on the above and other incidental grounds that the petitioner seeks to challenge the action of the respondents. 3. The learned Senior Advocate, Shri Prabhuling Navadgi, app .....

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..... that in so far as categorization of importers is with a view to ensure that regular importers do not suffer and at the same time, new entrants also being provided an opportunity, the applicants are sought to be divided into two categories based on their past record. The policy guidelines allow registration of quantity up to 270 metric tonnes in respect of Category - A applicants and 180 MT in respect of Category - B applicants. The former category are presumably experienced and have the infrastructure for efficient import and the latter are eased into the trade by providing a reasonable allocation of the import. It is pointed out that during the crop year 2014-15, contracts for a total quantity of 15375 MT were registered for import. However, the actual import was only 13669 MT. This short-fall had created an artificial scarcity, thereby resulting in rise in prices. It was hence justified to have a classification of assured importers and the casual importers who had obtained licence, but never imported. As regards the fixation of a provisional country cap with respect to Turkey was for the reason that with regard to China and the Czech Republic, the availability of seeds were m .....

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..... certificate from the Turkish authorities that the poppy seeds have been legally grown in Turkey as per the requirements of International Narcotics Control Board. On production of the certificate the goods will be cleared. 4. The same procedure shall be adopted once the final country cap is determined. 5. The Narcotics Commissioner shall ensure that the EDI (electronic data interchange) system is set up in such a way that once the country cap is achieved, the system will not accept any further bills of entry in respect of import of poppy seeds. 6. This system will ensure that all importers get equal opportunity to import poppy seeds, without any categorization or preferential treatment. 7. This suggestion may require a clarification from the Allahabad High Court. Option II 1. The provisional country cap is announced on the basis of legally grown poppy in Turkey. 2. Importers will be free to enter into contracts with their foreign suppliers. Once the goods are loaded onto the ship along with a Bill of lading and a certificate from the Turkish authorities that the poppy seeds are legally grown, the importer can register the contract with the Narcotics Commissioner .....

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