Case Note & Summary
The petitioners, Maharashtra Fur Fabrics Ltd. and its shareholder, filed a writ petition challenging orders of the Ministry of Commerce denying Cash Compensatory Support (CCS) for supplies made to Advance License holders under the Duty Exemption Scheme. The Government introduced the Duty Exemption Scheme in the Import Export Policy for 1985-88, 1988-91, and 1990-93 to provide inputs at international prices without customs duty for export production. The Scheme covered Advance Licenses, Intermediate Advance Licenses, and Special Imprest Licenses. The petitioners, manufacturers of High Pile Fur Fabrics, claimed CCS on supplies made to Advance License holders, treating them as deemed exports. The respondents denied CCS, stating that the policy only provided CCS for direct exports and not for deemed exports. The court examined the policy provisions and found that CCS was expressly limited to direct exports. The court rejected arguments based on promissory estoppel and legitimate expectation, holding that no representation was made to extend CCS to deemed exports. The petition was dismissed.
Headnote
A) Export Promotion - Cash Compensatory Support - Deemed Exports - Import Export Policy 1988-91 and 1990-93 - Petitioners claimed CCS on supplies made to Advance License holders as deemed exports - Court held that CCS was available only for direct exports and not for deemed exports under the Duty Exemption Scheme - Policy provisions did not extend CCS to supplies made to Advance License holders - Petition dismissed (Paras 1-10).
B) Administrative Law - Promissory Estoppel - Legitimate Expectation - Claim based on alleged representations in policy - Court held that no promise or representation was made by the Government to grant CCS on deemed exports - Policy clearly limited CCS to direct exports - No estoppel against statute or policy (Paras 8-10).
Issue of Consideration
Whether the petitioners are entitled to Cash Compensatory Support (CCS) for supplies made to Advance License holders under the Duty Exemption Scheme, when the policy provisions do not expressly provide for CCS on deemed exports.
Final Decision
The petition is dismissed. The orders denying CCS are upheld.
Law Points
- Cash Compensatory Support
- Deemed Exports
- Duty Exemption Scheme
- Import Export Policy
- Interpretation of Policy Provisions
- Promissory Estoppel
- Legitimate Expectation
Case Details
2010 LawText (BOM) (03) 24
Writ Petition No.975 of 1992
Mr. H. Daruwalla a/w. Mr. Parag Sawant i/b. Crawford Baley & Co. for petitioners; Mr. M.I. Sethna, Senior Advocate with Mr. H.V. Mehta for respondents
Maharashtra Fur Fabrics Ltd. & Anr.
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Nature of Litigation
Writ petition challenging denial of Cash Compensatory Support (CCS) for supplies made to Advance License holders under the Duty Exemption Scheme.
Remedy Sought
Petitioners sought quashing of orders denying CCS and direction to grant CCS on supplies made to Advance License holders.
Filing Reason
The respondents denied CCS to the petitioners for supplies made to Advance License holders, claiming that CCS was only available for direct exports.
Previous Decisions
Various orders (Exhibits I, N, O, R1 to R7) by the Ministry of Commerce denying CCS.
Issues
Whether the petitioners are entitled to Cash Compensatory Support (CCS) for supplies made to Advance License holders under the Duty Exemption Scheme.
Whether the policy provisions extend CCS to deemed exports.
Submissions/Arguments
Petitioners argued that they were entitled to CCS on supplies made to Advance License holders as deemed exports under the Duty Exemption Scheme.
Respondents contended that CCS was only available for direct exports and not for deemed exports under the policy.
Ratio Decidendi
Cash Compensatory Support under the Import Export Policy is available only for direct exports and not for deemed exports such as supplies made to Advance License holders. The policy provisions do not extend CCS to deemed exports, and no promise or representation was made to the contrary.
Judgment Excerpts
This petition is directed against the various orders passed from time to time by the respondent incorporated at Exhibit I, N, O and R1 to R7, whereby and whereunder, the Ministry of Commerce, Government of India, New Delhi denied cash incentive known as Cash Compensatory Support ('CCS' for short) to the petitioners.
The Government of India in order to save foreign exchange and promote exports by indigenous manufacturers had introduced the Duty Exemption Scheme in the Import Export Policy AM198588.
Procedural History
The petitioners filed Writ Petition No.975 of 1992 in the Bombay High Court challenging the orders of the Ministry of Commerce denying CCS. The judgment was reserved on 24th February 2010 and delivered on 12th March 2010.
Acts & Sections
- Import Export Policy 1988-91: Paragraph 219(1)
- Import Export Policy 1990-93: Paragraph 229
