SUNDARAM TEXTILES LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) AS the facts leading to all the writ petitions are almost identical, they are disposed of by this common order.

(2.) THE petitioner's company is doing business for the last 40 years by manufacturing cotton yarn with 40,000 spindles from 1988 after expanding its textile mill. THE Government of India, in order to boost the exports of textile goods from India, introduced a scheme for liberalising the import of capital goods with export obligation and the Notification in Public Notice No.59/ITC (PN)/90-93 dated 07.09.1990 was issued by the Director General of Foreign Trade/3rd respondent herein, to facilitate the import of capital goods by manufacturers, who do not fulfil the export performance criteria for the past 3 years as laid down in sub paragraph 2 in paragraph 197 of Import and Export Policy, April 1990-March 1993 Volume I, subject to such conditions as may be prescribed by the Government. THE conditions stipulate that they should export in the subsequent 4 years about 3 times the CIF value of the capital goods, for which a legal agreement and a bond towards the exempted duty has to be executed by the importer to the Director General of Foreign Trade / 3rd respondent herein, the licensing authority as per paragraphs 196 and 197 of the Handbook of Procedures April 1990-March 1993 Volume I. THE petitioner's company, by application dated 20.08.1990, applied for 2 nos. of auto-coner, 2 nos. of Toyoda-Comber, 2 nos. of Cherry Combers amounting to 6 nos. and by another application dated 17.09.1990, the petitioner's company applied for another 2 nos. of Toyoda comber and 2 nos. of Cherry Combers. THE total value of 10 nos. of machineries was about Rs.187.30 lakhs. But, the Director General of Foreign Trade/3rd respondent herein, without looking into the Public notice dated 07.09.1990, rejected the petitioner's application for import license by two letters dated 15.11.1990. But, in the meanwhile, anticipating the grant of import licenses, the petitioner opened irrevocable Letters of Credit for import of all the machineries, except one auto coner, and the goods were also shipped from Japan and the same also arrived. THE petitioner approached the respondents 4 and 5 to clear the goods under paragraph 197 of the Import & Export Policy - Volume I for the period April 1990 to March 1991. But, the Customs Authorities refused to clear the goods and directed the petitioner to pay full duty. THErefore, the petitioner filed W.P.No.16596/1990 before this Court, seeking for release of one auto coner, which arrived at the Madras Port during October 1990, which is kept in bonded warehouse. This Court by order dated 31.10.1990, ordered to release of the Auto coner on the following conditions:-

(3.) LEARNED counsel appearing for the petitioner submits that when all the conditions under paragraph 197 of the Import Policy towards export and the Notification No.169/90-Cus dated 03.05.1990 were fully satisfied with by the petitioner, the Director General of Foreign Trade / 3rd respondent herein took up the matter for regularising the import of machineries as directed by this Court in W.P.No.2243 of 1991 dated 09.11.1998. But, the Director General of Foreign Trade / 3rd respondent herein has got no authority to refuse regularising the import by the petitioner under paragraph 197 of the Import Policy, particularly, when this Court directed the 3rd respondent to consider the same with reference to Public Notice No.59/ITC (PN) 90-93 dated 07.09.1990. On that basis, it was pleaded that the order of rejection of 3rd respondent is arbitrary, illegal and unconstitutional.