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TMI Blog2018 (7) TMI 928X X X X Extracts X X X X X X X X Extracts X X X X ..... r. D.P. Singh for Respondent Nos.1 to 4 in WPL 1808/2018, WPL 1809/2018, WPL 1810/2018 with CHSWL 239 of 2018, WPL 1904 of 2018 and WPL 2079/2018. Mr. Karan Adhik with Mr. Ram Ochani for Respondent No.5 in WPL 1808/2018, WPL 1810/2018, WPL 1827/2018 and WPL 2079 of 2018 and for Respondent No.6 in WPL 1809/2018. ORAL JUDGMENT : [Per S.C. Dharmadhikari, J.] 1. In Writ Petition (L) No. 1810 of 2018, an affidavit is filed and a stand, which is stated to be a common one in all the petitions, is taken. Since we have heard the parties at length and extensive arguments have been canvassed, we dispose of these writ petitions finally. 2. We grant Rule in all these writ petitions. Respondents waive service. 3. The only question in these petitions under Article 226 of the Constitution of India is whether the Government of India, Ministry of Commerce and Industry, Department of Commerce, Directorate General of Foreign Trade's Notification No.4 /215-220 dated 25th April, 2018, and particularly the Policy condition No.4 therein has been creating, according to some Regional authorities of the Directorate General of Foreign Trade, a situation where clarification was required to be obtained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be registered with the officers of the DGFT as per the procedure prescribed. Then, there is reliance placed on a trade notice, copy of which is at Exhibit-E dated 9th May, 2018. It is stated that after the petitioner's application was processed, the Registration Certificate was granted on 14th May, 2018. 11. The complaint is that in total contrast to the earlier trade notice dated 9th May, 2018, as also contrary to the condition stipulated in the Notification dated 25th April, 2018, the impugned trade notice dated 18th May, 2018, has been issued and that curtailed what was the stipulation earlier and as understood by the trade so also by the DGFT. Meaning thereby, only those contracts against which full or 100% advance payment was made prior to 25th April, 2018, are eligible to be registered in terms of the Notification dated 25th April, 2018. Accordingly, instructions were issued to all the Regional authorities to cancel / recall the registration certificates already issued to various parties. A copy of the impugned trade notice dated18th May, 2018, is annexed as Exhibit-G to the petition. 12. The prayers in the writ petition thus are for quashing and setting aside of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osition of minimum import price and quota restrictions. Bearing in mind the high agricultural production in the country resulting in prices of pulses sliding below the minimum support price and owing to increase in area under crop production leading to further fall of price, in consultation with the stake holders, the Government has imposed quota restrictions on import of mung beans, black lentils and pigeon peas. Then, the affidavit refers as to how in the fiscal year 201718 quota restrictions on import of pigeon peas, mung and urad dal were imposed taking into account the huge domestic production resulting in price falling below the minimum support price. Relying upon paragraph 1.05 of the Foreign Trade Policy as also paragraph 2.58 thereof, it is stated that the relaxation as granted from the Policy is not a right. It is granted on the merits of each case. 15. In the current fiscal 2018-19, the Government found the situation to be identical and, therefore, similar quota restriction was placed on import of pulses. The stand of the Government, to be more specific and in its own words, is as under: "I say that during the current and fiscal year i.e. 2018-19, it was however observ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quotas of such imports where advance payments are miniscule, it decided to grant relaxation and allow registration of such contracts provided on merits they satisfy the condition. Thus, other importers anticipating similar quota relaxation on import of pulses are trying to take advantage of the prevailing situation and after paying token advance are now questioning the stipulation itself. If their understanding is upheld that will jeopardize the already precarious condition of the farmers. For all these reasons and denying everything to the contrary, the affidavit prays that the writ petition be dismissed. 17. Before we summarize the rival contentions it would be advantageous to reproduce the Notification dated 25th April, 2018, the Trade Notice dated 9th May, 2018 and the Trade Notice which is impugned dated 14th May, 2018, in that order. We reproduce the same for ready reference. "Government of India Ministry of Commerce & Industry Department of Commerce Directorate General of Foreign Trade Notification No. 4/2015-2020 New Delhi, Dated: 25 April, 2018 Subject : Amendment in Import policy of Peas under Chapter 7 of the ITC (HS) 2017, Schedule - I (Import Policy) S.O. (E) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch imports before 25.04.2018, they may furnish such documents indicating the quantity contracted and amount paid, so as to enable this Directorate to lay down further procedure for import of the remaining quantity. 4 The requisite information, alongwith supporting documents may kindly be furnished latest by 18th May, 2018 (5:00 p.m.) at [email protected] and [email protected]. Sd/- (S.P. Roy) Joint Director of Foreign Trade Email : [email protected] *** *** *** DGFT TRADE NOTICE -COPY OF- TRADE NOTICE NO.10/2018-19 Dated 16 th May, 2018 To 1 Members of Trade 2 All Customs Commissionerates 3 JS (Customs), CBEC, New Delhi 4 RAs of DGFT Clarification regarding DGFT Notification No.4 & 5 The Directorate General of Foreign Trade has been receiving a number of queries seeking clarification on the Notification No.04/2015-20 dated 25th April, 2018 vide which the import policy of Peas under Chapter 7 of the ITC (HS) 2017 has been amended. In the matter, it has been observed that even though the Notification clearly lays down that the Import Policy of 07131000 - Peas has been revised with revised policy condition, the effect of Notification, it has been indicated tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... April, 2018. With regard to this, the parties are ad-idem and that is not an issue before us. It is only the subsequent part, namely, of those shipments backed by irrevocable commercial letter of credit (ICLC) and advance payment made through banking channel before 25th April, 2018, which is highlighted in these petitions. It is stated that both these categories will be required to be registered with jurisdictional Regional Authority (RA for short) as per paragraph 1.05 of the FTP. 21. The second clause of this Notification, however, has not been referred to, but is equally important, namely, the effect of the Notification. The Trade Notice dated 9th May, 2018 is on the subject of implementation of Notification No.4 dated 25th April, 2018. A reference is made to this Notification in this Trade Notice and clause No.2 thereof makes reference to Policy Condition No.4. However, while implementing this Notification, the Joint Director of Foreign Trade was approached and he clarified that to assess the remaining balance, importers who have already contracted for import of peas before the date of issue of the Notification and have paid in advance (full or in part) for the same or have o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s "advance payment" as defined will take their colour from the terms of the contract. Mr. Nankani would submit that in the instant case, the factual position is that the shipment is before 9th May, 2018. The attention of this Court is invited to Exhibit 'F' at page 61 to indicate that there are details, which have been provided, styled as irrevocable commercial letter of credit and advance registration details. This document indicated the bank reference number, bank reference date, amount in US$, the quantity metric ton, sales contract date. All of this would indicate that on 24th April, 2018, these details were very much available. That is how the contract qualified for registration and the registration certificate was granted. In these circumstances, the intent was not to deprive the importers like the petitioners of the benefit of the relaxation or concession or departure in the form of amendment to the policy. If what was free has now been made restricted to, yet, there is a window, then, consistent with this policy, the importers should be allowed to enjoy the benefit. In other words, the trade notices cannot be said to be overriding the Notification. If the Notificati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterest of the Indian farmers, granted the relaxation, but with conditions. 26. It may be that after these petitions were argued, some more documents have been tendered by the petitioners, but the essential nature of the controversy does not change by bringing in these materials. The materials are in the form of a chart and some Notifications/trade notices for Toor Dal/Urad/Moong Dal and registration certificates issued to various importers. 27 The respondents canvassed their arguments consistent with the affidavit in reply and maintained that no material in addition to the annexures to the petitions be now allowed to be relied upon and this court should not take into consideration the same. 28. Mr. Sridharan learned senior counsel appearing for the intervener also supported the respondents and submitted that their stand is the only one possible in this case. He has taken us through the Notifications amending para 1.05 of the FTP and trade notices to urge that this is not a case where we should allow any principle of law to be canvassed and to the effect that this Notification issued under the exercise of statutory powers has to be amended in like manner and not by a circular or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al course and issue the interim orders. 33. At the out set, we have clarified to the learned senior counsel as also the learned counsel appearing for the respondents that having heard all the parties and counsel at great length, it would not be now proper to pass only some interim or tentative orders. We have, with their consent, disposed of the petitions finally by this judgment and order. 34. It is no doubt that the principle, which is settled as far as administrative law is concerned, in unequivocal terms says that the statutory notifications, if required to be altered or amended in future, then, the same route has to be adopted and no administrative orders/executive instructions and circulars can then be issued so as to interfere with, much less amend the statutory prescriptions. A Notification in this case, according to the learned senior counsel appearing for the parties, has been issued in exercise of the statutory powers conferred by section 3 of the FTDR Act. Therefore, an amendment to the Notification has to be in like manner. Section 3 of the FTDR Act falls in Chapter II. Sub-section (1) says that the Central Government may, by order published in the Official Gazette, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansitional Arrangements (a) Any License/ Authorisation/ Certificate/ Scrip/ instrument bestowing financial or fiscal benefit issued before commencement of FTP, 2015-20 (as updated) w.e.f. 5-12-2017 shall continue to be valid for the purpose and duration for which it was issued, such Licence/ Authorisation/ Certificate/ Scrip/ any instrument bestowing financial or fiscal benefit Authorisation was issued, unless otherwise stipulated. (b) In case an export or import that is permitted freely under FTP is subsequently subjected to any restriction or regulation, such export or import will ordinarily be permitted, notwithstanding such restriction or regulation, unless otherwise stipulated. This is subject to the condition that the shipment of export or import is made within the original validity period of an irrevocable commercial letter of credit, established before the date of imposition of such restriction and it shall be restricted to the balance value and quantity available and time period of such irrevocable letter of credit. For operatiionalising such irrevocable letter of credit, the applicant shall have to register the Letter of Credit with jurisdictional Regional Authority (RA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2018 and subject to Policy Condition 4 of the Chapter. Thus, the policy condition 4 appearing in this very notification cannot be ignored. If the revision of the import policy results in import of peas being restricted, then, the restriction subject to policy condition would have to be understood and construed as a whole. Policy Condition 4 says that from 1st April, 2018 to 30th June, 2018, total quantity of one lakh metric ton of yellow peas minus the quantity already imported from 1st April, 2018 till 24th April, 2018, will be allowed against licence as per procedure to be notified by the DGFT. There was never any intent, therefore, to allow any quantity to be imported exceeding this one lakh metric ton. This is the total quantity which is allowed to be imported between the period from 1st April, 2018 to 30th June, 2018. From this, what is to be subtracted is the quantity already imported from 1st April, 2018 till 25th April, 2018. That will include shipment already arrived and with regard to that part, there was never any dispute nor any confusion in understanding the condition. Thus, the shipment, which has arrived containing this deducted quantity between this 1st April, 2018 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tification, as is wrongly understood and argued before us. It is only to remove the doubts expressed by the Regional Authorities and issue the clarification that this trade notice was issued. Its language and particularly that of para 3 is consistent with the notification itself. The argument that the earlier trade notice of 9th May, 2018 makes reference to payment in advance (full or in part) does not cause any confusion and the expression "advance payment" was always understood to be so is without any merit. What has been provided by the Notification No. 4 is that the expression "already imported" will include shipment already arrived from 1st April, 2018 till 25th April, 2018 and those shipments backed by irrevocable commercial letter of credit and advance payment made through banking channel before 25th April, 2018. Both these categories will be eligible to be registered with jurisdictional Regional Authority as per para 1.05 of the FTP. In the sense, if the contracted quantity and in terms of a contract between the local importer and the person abroad is specified, in relation to that, if the entire payment has been secured in terms of this ICLC or full advance payment, irresp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usion to that extent has been removed by the impugned trade notice. We do not see how we can accept the argument that this amends the Notification and it is a substantive exercise carried out in terms of the statutory powers. We see nothing of this kind resulting from the issuance of the trade notice dated 18th May, 2018 and impugned in this petition. It is but a clarification issued during the implementation of the Notification dated 25th April, 2018. 39. In these circumstances, the transitional arrangement, which has been clarified by this trade notice does not contravene the substantive provisions of the notification or section 3 of the FTDR Act in the Central Government. 40. To such an exercise, the principles pressed into service by Mr. Thorat and Mr. Dewani have no application. In the case of Tata Teleservices Ltd. (supra), the Customs Notifications exempting the goods from duty and the issue of their interpretation was under consideration. The circular impugned has imposed a limitation on the exemption Notification, which the exemption Notification itself did not provide. Thus, this was a clear attempt to overreach/override or amend the exemption notification. If an exempt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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