RINA INTERNATIONAL Vs. UNION OF INDIA

JUDGEMENT

(1.) THE petitioner No. 1 is a partnership firm carrying on business of export and import of rough diamonds. By letter dated February 20, 1986, the petitioners applied for issuance of an advance licence and the licence was issued on July 21, 1986 for value of Rs. 20,11,200/ -. While granting the said imprest licence, the respondents called upon the petitioners to furnish Bank guarantee for 50% of the licence value a condition precedent. The petitioners invited attention of the respondents to a Note under Para 340 of the Hand Book of Import Export Procedures for April 1985 - March 1988. The petitioners pointed out that it is open for the respondents to accept a legal undertaking in lieu of Bank guarantee. The respondents by letter dated August 11, 1986 turned down the request for acceptance of legal undertaking on the ground that though the petitioners are exporters of cut and polished diamonds during year 1982-83 and year 1983-84, for the period of year 1984-85, the export related to "re-export of rough diamond rejections". The respondents conveyed that the re-export of rough diamond rejections cannot be considered as export of cut and polished diamonds. The decision of the respondents in declining facility of furnishing legal undertaking has given rise to this petition under Article 226 of the Constitution of India.

(2.) SHRI Kamdar, learned counsel appearing on behalf of the petitioners, submitted that the petitioners are registered exporters and are carrying out the import and export of rough diamonds and cut and polished diamonds. We have perused the Note under Para 340 of the Hand Book of import Export Procedures 1985-1988 and the perusal of the same makes it clear that the petitioners are entitled to the facility of legal undertaking in lieu of Bank guarantee. The rejection of the facility on the ground that for one year the petitioners re-exported rough diamond rejections cannot be sustained. In our judgment, the petitioners are entitled to the facility of legal undertaking while granting of imprest licence.

(3.) ACCORDINGLY, petition succeeds and rule is made absolute in terms of prayers (a) and (b) with no orders as to costs.