TMI BlogSEIS benefit can’t be denied for not having IEC when services rendered No IEC required for availing benefit of SEISX X X X Extracts X X X X X X X X Extracts X X X X ..... SEIS benefit can’t be denied for not having IEC when services rendered No IEC required for availing benefit of SEIS - By: - CA Bimal Jain - Customs - Import - Export - SEZ - Dated:- 27-8-2022 - - The Hon ble High Court, Bombay in the matter of SMARTE SOLUTIONS PVT. LTD, VERSUS UNION OF INDIA THROUGH, THE JOINT SECRETARY, DEPARTMENT OF REVENUE, MINISTRY OF COMMERCE, NEW DELHI, THE JOINT SECRE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TARY, MINISTRY OF LAW, JUSTICE COMPANY, MUMBAI, DIRECTOR GENERAL FOREIGN TRADE POLICY, NEW DELHI, REGIONAL AUTHORITY, OFFICE OF ADDL. DIRECTOR GEN. OF FOREIGN TRADE, JOINT DIRECTOR GENERAL OF FOREIGN TRADE, MUMBAI [2022 (8) TMI 186 - BOMBAY HIGH COURT] directed the department to consider the application for Services Export from India Scheme ( SEIS ) benefits on the ground that delegate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d legislature cannot violate the principal statue i.e., Foreign Trade Development and Regulation Act, 1992 ( the FTDR Act ) . Facts: M/s Smarte Solutions Pvt. ( the Petitioner ) has engaged in providing high quality data services (i.e. market research services) and are eligible for the SEIS benefits, as introduced under the Foreign Trade Policy 2015-20 ( FTP ) .The Peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner tried filing the SEIS application for the year 2015 2016 and 2016-2017. However, the On-line system did not accept the Petitioner s application and displayed an error message that it is not a valid Import Export Code ( IEC ) . The Petitioner has approached the Director General of Foreign Trade ( the Respondent ) , but the problem was not solved and hence the Petitioner tendered it manuall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. However, the Respondent refused to entertain the same. The Petitioner then filed review application and it was similarly disposed of. Being aggrieved by the said rejection, the Petitioner has invoked the present writ petition. Petitioner s Contentions: The eligibility for availing benefit under the SEIS was rejected merely on technicalities. One of the conditions to av ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ail of the benefit under the SEIS is that the service provider should have an active IEC number at the time of rendering services for which the SEIS be nefit have been claimed and accordingly an IEC number was obtained before applying for the benefit of the scheme. Further that the requirement of obtaining an IEC number at the time of rendering services was not a statutory req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uirement. T he FTP is notified by the Central Government in the exercise of the powers conferred under Section 5 of the FTDR Act , therefore the policy notified under the FTDR Act should be in conformity with the provisions of the FTDR Act. The delegated legislation cannot be contrary to the principal statute. The delegated powers are for making rules for carrying out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the purpose of the Act without adding or substituting any right or obligation. Issue: W hether the condition of having an active IEC number at the time of rendering services for claiming reward is consistent with the statue or it has exceeded the Authority under which delegation was made ? Held: The Hon ble High Court, Bombay in SMARTE SOLUTIONS PVT. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... LTD, VERSUS UNION OF INDIA THROUGH, THE JOINT SECRETARY, DEPARTMENT OF REVENUE, MINISTRY OF COMMERCE, NEW DELHI, THE JOINT SECRETARY, MINISTRY OF LAW, JUSTICE COMPANY, MUMBAI, DIRECTOR GENERAL FOREIGN TRADE POLICY, NEW DELHI, REGIONAL AUTHORITY, OFFICE OF ADDL. DIRECTOR GEN. OF FOREIGN TRADE, JOINT DIRECTOR GENERAL OF FOREIGN TRADE, MUMBAI [2022 (8) TMI 186 - BOMBAY HIGH COURT] as held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as under: Relied upon the judgement of Hon ble Supreme Court, India in the case of KUNJ BEHARI LAL BUTAIL VERSUS STATE OF HP [2000 (2) TMI 826 - SUPREME COURT] wherein it was held that the delegated power to legislate by making rules is for carrying out the purposes of the FTDR Act is a general delegation without laying down any guidelines. It cannot be exercised as to bring into e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xistence substantive rights or obligations, or disabilities not contemplated by the provisions of the FTDR Act itself. As per Section 7 of the FTDR Act, it does not lay down that the IEC number is essential at the time of rending services of said specified kind. The requirement of IEC number is only for taking benefits under the scheme. Therefore, it is abundant clear that the eligibilit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y criteria of the FTP has imposed additional restriction of having IEC number at the time of rendering services which was not intent or purport of the statute. The condition is against the principal legislation and therefore, it cannot be termed as of mandatory nature for availing benefits under the scheme. Held that, the petition is hereby allowed, and the Respondent is directed to consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Petitioner s application without insisting for an active IEC number at the time of rendering services. The Respondents shall take appropriate decision within three months from the date of receipt of this order and shall communicate its decision to the Petitioner. (Author can be reached at info@a2ztaxcorp.com ) - - Scholarly articles for knowledge sharing authors experts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... professionals Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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