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TMI Blog2013 (1) TMI 913X X X X Extracts X X X X X X X X Extracts X X X X ..... facture and export of industrial fabrics and they have challenged the order passed by the 3rd respondent dated 18-8-2003. By the said order, the 3rd respondent informed the petitioner that in terms of EPCG Licence dated 11-1-1995, the petitioner ought to have completed the export obligation on or before 31-3-2002, which is an extended date and since the petitioner was registered as a Sick Industrial Company by the Board for Industrial and Financial Reconstruction (in short "BIFR") only on 24-7-2003, beyond the deadline fixed for completing the export obligation, the petitioner is not eligible for extension of benefits under Para 5.5.1 of the Exim Policy and the extension sought for by the petitioner cannot be granted. Consequently, in the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xecute legal undertaking and bank guarantee as indicated in Para 102 of the Handbook of Procedure as amended from time to time by the Directorate General of Foreign Trade. The petitioner imported the goods and cleared the consignment vide Bill of Entry dated 15-5-1995 and also furnished bank guarantee for ₹ 20,00,000/- in terms of the conditions stipulated in the licence. 5. Thereafter, the petitioner by letter dated 18-1-2000 addressed the Directorate General of Foreign Trade informing that the export obligation to be fulfilled is less than the amount indicated in the licence in view of the lesser value of import goods and, therefore, sought for reduction of the bank guarantee amount and along with the said letter, the petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner. Thereafter, by letter dated 24-1-2003, the 3rd respondent directed the 5th respondent bank to pay the amount which was covered under the bank guarantee and sought to encash the bank guarantee. Subsequently, by letter dated 10-2-2003, the petitioner was informed that in terms of the current Exim Policy further extension cannot be granted beyond 31-3-2002. In response to these communications, the petitioner by their letter dated 26-2-2003 submitted that the calculation made by the department in respect of the quantum of export obligation was not correct and the petitioner submitted a revised calculation and undertook to extend the bank guarantee for a further period up to 31-3-2003. It is submitted that the petitioner had been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thority but, by the Foreign Trade Development Officer and there is nothing on record to show that he has been authorised to communicate the order of the Directorate General of Foreign Trade and as such the impugned order is wholly without jurisdiction and contrary to Foreign Trade (Development and Regulation) Act and the Import and Export Policy and the Sick Industrial Companies (Special Provisions) Act, 1985. 9. The learned counsel for the petitioner further submitted that the respondents having accepted that the petitioner industry is a sick industry and registered with BIFR vide Case No. 129 of 2003, ought not to have rejected the request of the petitioner for extension of time to fulfil the export obligation by adopting the provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... become a sick industrial company registered under the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985. The petitioner sought for reference to the BIFR by their application dated 20-11-2002. The said application was received by the BIFR on 3-12-2002 and the case was registered as Case No. 129 of 2003. For the purpose of entertaining reference from an industry to declare it as a sick industrial company, the attested balance sheet and the annual report of the company ending as on 31st March of the relevant year are required to be taken into consideration. It cannot be disputed that sickness of an industry does not occur instantaneously but, on account of various factors which ultimately culminates into an industry be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the funds etc.; salvaging the production of assets; realising the amounts due to the banks, etc.; and to replace the existing time-consuming and inadequate machinery by efficient machinery for expeditious determination by a body of experts. Therefore, the Act has been enacted to safeguard not only the economy of the country, but also to protect viable sick units and it is aimed at reviving and rehabilitating sick units. Even under the Act, sickness is not defined in precise terms, rather it is a symptom of ailment and not an ailment itself. In the absence of a standard definition for sickness in industries, we are required to take into consideration various parameters, which if present would give a broad indication that the unit is a sick ..... X X X X Extracts X X X X X X X X Extracts X X X X
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