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Banarsi Das & Sons Versus Union of India

2016 (4) TMI 1284 - CALCUTTA HIGH COURT

Benefit of notification of December 28, 2012 - duty credit scrip - Held that: - the petitioners will be entitled to the benefit under the notification of December 28, 2012 irrespective of the modification that was brought in by the notification of September 25, 2013. Accordingly, the petitioners’ claim should be considered by the DGFT in such light and on the basis of the earlier notification and without reference to the later. The order impugned dated October 5, 2015 is set aside to the extent .....

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ntive that the petitioners were entitled to under a notification of December 28, 2012. The petitioners claim that the issue involved herein is covered by an order of this Court of January 28, 2016. The petitioners say that a recent judgment of the Supreme Court reported at (2016) 2 SCC 226 = 2015 (326) E.L.T. 26 (S.C.) (Director General of Foreign Trade v. Kanak Exports) leaves no doubt as to the petitioners entitlement. 2. Though the Union does not dispute that the issue is the same as in .....

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ioners. 4. The notification of December 28, 2012 added a paragraph to the foreign trade policy of 2009-2014 by way of paragraph 3.14.4, entitled Incremental Exports Incentivisation Scheme. The operative part of such scheme provided as follows : An IEC holder would be entitled for a duty credit scrip @ 2% on the incremental growth (achieved by the IEC holder) during the period 1-1-2013 to 31-3-2013 compared to the period from 1-1-2012 to 31-3-2012 on the FOB value of exports. Incremental gro .....

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ed before the appropriate authority with a substantial claim for the duty credit scrip. Such claim has been, in the most part, declined without reasons by an order of October 5, 2015. In fact, the relevant order does not reveal the rejection of the petitioners claim under the notification of December 28, 2012, but it is evident from the quantum of credit indicated in the relevant communication, that a reduced amount has been allowed. 6. The petitioners say that such partial rejection is by .....

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subjected to greater scrutiny by Regional Authority. 7. The petitioners suggest that once the petitioners had completed the act that entitled the petitioners to the incentive announced, the incentive could, thereafter, not be discontinued or the scheme could not be modified to the prejudice of the petitioners, unless the scheme had a date of closure originally indicated therein. The petitioners say that the Central Government does not have any authority under Section 5 of the Foreign Trade .....

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India) was also noticed therein where it was held that the subsequent notification could not affect the rights that had vested in any exporter prior to the subsequent notification coming into effect. 9. The later judgment of the Delhi High Court of January 7, 2016 in WP (C) 6732 of 2015 = 2016 (332) E.L.T. 400 (Del.) (TT Limited v. Union of India) does not appear to have noticed the earlier view of the same Court in the Sesa Sterlite case. 10. In TT Limited, the Bench relied on paragr .....

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rant such a privilege or not. It is also trite law that such exemptions, concessions or incentives can be withdrawn any time. All these are matters which are in the domain of policy decisions of the Government. When there is withdrawal of such incentive and it is also shown that the same was done in public interest, the Court would not tinker with these policy decisions. This is so laid down in a catena of judgments of this Court and is now treated as established and well-grounded principle of l .....

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estion, however, is as to whether it can be done retrospectively, thereby taking away some right that had accrued in favour of another person? 12. After posing such question, the Supreme Court referred to the submission made by the exporters in that case that by achieving the target contained in the relevant scheme in respect of incremental exports, a right had accrued in their favour to claim the benefits provided for achieving the target. In that case, the scheme set out certain targets a .....

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e impermissible. 13. The Supreme Court referred to several previous judgments and the general principle that delegated legislation could not be made operative retrospectively unless the authority conferred by the statute in such regard was specific. Paragraph 113 of the report in Kanak Exports explains the legal position, including that the modification or the closure of such a scheme after an exporter had done the act that entitled the incentive under the original notification would amount .....

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