IBIZA INDUSTRIES LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) This writ petition under Article 226 of the Constitution of India has to be rejected solely on the ground of total suppression of material facts. The petitioner herein imported certain machines on Actual User's Licence under the Export Promotion Capital Goods Scheme (for short 'EPCG'), in particular, paragraph 38 of the Export Import (EXIM) Policy 1992-97. Though the petitioner was granted EPCG licence under para 38 of the EXIM Policy 1992-97, under the licence, there was existing an export obligation in respect of Polyster Woolen and Polyester Viscose Fabrics worth US 14,347,353 to be exported within 5 years from the date of issue of the licence. The export proceeds are required to be in freely convertible currency and in terms of condition No. 5 of the import licence, prior to clearance of the first consignment, the company was required to execute a legal undertaking and a bank guarantee for the full duty saved amount. The contextual facts depict that the licence was issued in respect of import of 32 Sulzer Looms as early as 6th June, 1995 and under three Bills of Entry, import of permitted capital goods were made at concessional rate of duty of 15% ad valorem under the EPCG scheme read with exemption notification No. 110/95. The machines, were thereafter installed at the manufacturing premises of the Company at Hyderabad within a period of six months,

(2.) The contextual facts further depict that without, however, fulfilling the requirements of the licence, as noted above, the writ petitioner did in fact request for permission to shift 24 Looms, out of 32, to the premises of M/s. Mafatlal Industries as also an extension of time in export obligation period and it is by reason of the rejection of such a prayer the writ petitioners thought it fit to move this Court under Article 226 of the Constitution, inter alia, for issuance of a Writ of Mandamus directing the respondents to withdraw the communication of rejection and to specifically grant the request made by the Company. The petitioners further prayed for issuance of a further Writ of Mandamus directing the respondents not to initiate any action by way of a recovery of duty/interest or any other coercive action by way of seizure, stoppage of production, etc.

(3.) During the course of hearing, Mr. Adinarayana Rao, learned Advocate appearing in support of the Central Government, contended, however, that the petitioner No.1 has in fact sold 16 of the 32 Sulzer Looms to M/s. Mafatlal Industries - petitioner No. 2. There has been, however, no denial of the factum of such a sale but, this aspect of the matter has been totally suppressed. In our view, this is a material fact which ought not to have been suppressed.