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TMI Blog2018 (4) TMI 1260X X X X Extracts X X X X X X X X Extracts X X X X ..... learned Assistant Solicitor General of India Mr. S.S.Aspalli, appearing for the appellant - Union of India submitted that the impugned communication Annexure-A dated 09.04.2013 denying such export subsidy to BSSKL was justified as the respondent-BSSKL had sold such sugar to the exporter M/s. Bannari Amman Sugars Limited (BASL) who had imported the raw sugar under the Advance Licence scheme and therefore under SDF Rule 20, such Export Subsidy was not admissible to the Respondent and therefore the claim of export subsidy was rightly rejected by the Government of India in the present case. 4. The learned ASGI has further submitted that the import and export of sugar after the value addition under the Advance Licence scheme was under entirely different scheme of Foreign Trade Policy 2015-2020 produced as Annexure-E, whereas the purpose of giving export subsidy under SDF Rule 20 was to clear off the excess stocks of excess sugar manufactured by the domestic manufacturers of sugar and to reduce their burden and cost of manufacturing, the said Export Subsidy in question to the extent of defraying their internal transport charges was announced by the Central Government under the said Sch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from railhead nearest to the port to the point of loading at port, the transport rate as specified in the Sugar (Price Determination for Production) Order of the relevant sugar season. 9. The learned counsel therefore urged that the claim of export subsidy of the respondent has to be computed as per said rules specified in the said Gazette Notification and in the absence of any specified exclusion of sale of sugar in the course of export through the exporters like M/s. Bannari Amman Sugars Limited (BASL), the appellant - Union of India could not have rejected the claim of the respondent in the present case. 10. Drawing the attention of the Court towards the Memorandum of Understanding between the respondent - BSSKL and the exporter M/s. Bannari Amman Sugars Limited (BASL), the learned counsel for the respondent urged before the Court that Annexure-D dated 22.03.2004, the sugar in question was to be supplied by BSSKL to BASL at the rate of Rs. 10,100/- per metric ton F.O.R. ANY INDIAN PORT. Clause-9 of the said Memorandum of Understanding further stipulated that the Internal Transport, Ocean Freight, Handling and Marketing Subsidies by the Government of Karnataka/Government of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee, decide from time to time, to defray expenditure on internal transport and freight charges to sugar factories on export shipments of domestically manufactured sugar with a view to promoting its export for such period as it deems proper. (2) Subject to the decision of the Central Government under sub- rule (1), the expenditure on internal transport and freight charges on export shipment shall be defrayed from the Fund. (3) Any sugar factory which after obtaining release order issued under clause 5 of the Sugar (Control) Order, 1966, has transported its manufactured sugar for export shipments, and the same has been exported either by the sugar factory or through an exporter, shall be eligible to apply for reimbursement of expenditure incurred on the internal transport and freight charges on such export shipments of sugar. Explanation I. Where a sugar factory has delivered the export consignment of sugar ex-factory to an exporter and the exporter has, after complying with the legal requirements exported the sugar, it shall be construed to be an export of sugar by that sugar factory through an exporter and that sugar factory shall be eligible for reimbursement of expenditure incu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndustry, Department of Commerce; (f) a certified copy of the distance Certificate issued under in sub-rule (8) regarding the distance between the sugar factory and the loading railhead; (g) a certified copy of the railway freight receipt from lading railhead to railhead nearest to the port; (h) a certified copy of the certificate of railway freight chargeable as specified in sub- rule (9); (i) a certified copy of the certificate issued by the port authorities certifying the distance between the railway station nearest to the port and loading point at the port as specified in sub-rule (10); (j) a certified copy of the receipt and challan of the road transporter indicating the vehicle number and quantity transported where the sugar factory has transported the export consignment of sugar by road. (6) A sugar factory shall be free to transport export consignment of sugar either by rail or road or both but the reimbursement of expenditure shall be restricted in the manner prescribed in sub-rule (7). (7) The reimbursement of expenditure on internal transport and freight shall be restricted as under: (i) for the distance from sugar factory to the nearest lading railhead, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to the sugar factory within that period to furnish any requisite document. (12) In a case where it is found at any time that a sugar factory has willfully suppressed the facts or concealed some material information or furnished false information or forged documents, then,- (a) the reimbursement claim of that sugar factory shall be rejected, (b) its future claim shall not be entertained, and (c) if the claim has already been settled, the sugar factory shall be liable to refund the amount along with such interest as the Committee may decide." 14. From a bare reading of the said Gazette Notification announcing the said export subsidy scheme, we do not find any exclusion of the manufacturers and sellers of sugars, like respondent- BSSKL, merely because their sale of sugar is to an exporter like BASL, who has exported such sugar out of India. On the contrary, such export of sugar by domestic manufacturers through other Exporters is clearly covered by the said Scheme and the very purpose of this scheme is to encourage such exports and to reduce the cost burden, to defray the internal transport charges out of such export subsidy. The respondent, like BSSKL squarely falls within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting the sugar through other exporters, like Bannari Amman Sugars Limited (BASL) in the present case. Moreover, the respondent-BSSKL in the present case was under compulsion to supply the said quantity of sugar to BASL under the directions of the Central Government itself vide order Annexure-C dated 23.03.2004, which clearly stipulated that 8500 MTs of sugar has to be supplied by the respondent-BSSKL to M/s. Bannari Amman Sugars Limited (BASL), Coimbatore for the purpose of export. 20. Therefore, on the one hand, the Central Government cannot compel a person to sell the sugar to an exporter and on the other hand, deny the export subsidy to it, which is clearly envisaged in the export subsidy scheme itself and there is no such exclusion in the same as is sought to be made out in the impugned order Annexure-A dated 09.04.2013. 21. We also do not find any force in the contention raised by the learned Assistant Solicitor General for the appellant-Union of India that since the said export subsidy was denied to other such suppliers of sugar also for the purpose of export and therefore, such rejection in the case of the respondent is also justified. 22. The learned Single Judge in para ..... X X X X Extracts X X X X X X X X Extracts X X X X
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