{"id":113205,"date":"2006-09-11T00:00:00","date_gmt":"2006-09-10T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/baraka-overseas-traders-vs-director-general-of-foreign-trade-on-11-september-2006"},"modified":"2017-07-29T11:07:46","modified_gmt":"2017-07-29T05:37:46","slug":"baraka-overseas-traders-vs-director-general-of-foreign-trade-on-11-september-2006","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/baraka-overseas-traders-vs-director-general-of-foreign-trade-on-11-september-2006","title":{"rendered":"Baraka Overseas Traders vs Director General Of Foreign Trade &#8230; on 11 September, 2006"},"content":{"rendered":"<div class=\"docsource_main\">Supreme Court of India<\/div>\n<div class=\"doc_title\">Baraka Overseas Traders vs Director General Of Foreign Trade &#8230; on 11 September, 2006<\/div>\n<div class=\"doc_author\">Author: M Katju<\/div>\n<div class=\"doc_bench\">Bench: Ashok Bhan, Markandey Katju<\/div>\n<pre>           CASE NO.:\nAppeal (civil)  1426 of 2001\n\nPETITIONER:\nBaraka Overseas Traders\n\nRESPONDENT:\nDirector General of Foreign Trade and Anr.\n\nDATE OF JUDGMENT: 11\/09\/2006\n\nBENCH:\nAshok Bhan &amp; Markandey Katju\n\nJUDGMENT:\n<\/pre>\n<p>JUDGMENT<\/p>\n<p>MARKANDEY KATJU, J.\n<\/p>\n<p>This appeal has been filed against the impugned judgment and order of the<br \/>\nAndhra Pradesh High Court dated 24.3.2000 in Writ Petition No. 4755 of<br \/>\n1999.\n<\/p>\n<p>Heard learned counsel for the parties and perused the record.\n<\/p>\n<p>The writ petition was filed in the High Court challenging the order of the<br \/>\nDirector General of Foreign Trade (hereinafter referred to as the `DGTF&#8217;),<br \/>\nNew Delhi dated 19.2.1999 by which the appellant&#8217;s request for endorsement<br \/>\nof transferability of the three licences in question, was refused.\n<\/p>\n<p>The facts of the case are that to enable Indian exporters to compete<br \/>\neffectively in the international market a scheme was framed by the Central<br \/>\nGovernment named the `Duty Exemption Scheme&#8217;. Under this Scheme, import of<br \/>\ncertain specified input items required for the manufacture and export of<br \/>\nresultant products was allowed with duty exemption benefits. For getting<br \/>\nthis benefit, the applicant exporter had to apply for licence with the<br \/>\ndetails of the input requirements. In case, the standard input\/output norms<br \/>\n(SION) for a particular export product were already notified at the<br \/>\nrelevant point of time, the licences are normally issued by the Licensing<br \/>\nAuthority concerned without making reference to the Advance Licensing<br \/>\nCommittee. In case, the SION is not fixed, the application is to be<br \/>\nconsidered by the Committee.\n<\/p>\n<p>The petitioner had obtained three advance licences dated 11.12.1997,<br \/>\n30.7.1998 and 30.7.1998 for export of `Fresh Frozen Sea foods&#8217; including<br \/>\n`Shrimps&#8217; and PUDs&#8217; from the Regional Office of the Joint Director General<br \/>\nof Foreign Trade, Hyderabad under the Export and Import Policy of 1997-2002<br \/>\n(in short hereinafter referred to as `EXIM POLICY&#8217;). These advance licences<br \/>\nwere issued for import of items such as LDPE\/HDPE\/PP Moulding Powder, Kraft<br \/>\nPaper, Raw Material for Fish Net, PP Moulding Powder\/Nylon Moulding<br \/>\nPowder\/Nylon Monofilament, Anti-oxidants viz., Gentamycin Sulphate,<br \/>\nDoxyeyclene HCL, Raw Material for Tubs, Basins, Crats, etc. i.e. HDPE\/PP<br \/>\nMoulding Powder, Anti-bacterial\/Anti-fungal material to increase the shelf<br \/>\nlife i.e Tetracyclene HCL used during fishing in ice, Soya Meal, Lecithin,<br \/>\nWheat Gluton, Gum Arabic, Beta-Methazone\/Dexamethazone.\n<\/p>\n<p>Against all the aforesaid three advance licenses the appellant filed three<br \/>\nseparate applications all dated 16.9.98 requesting for an endorsement of<br \/>\ntransferability after fulfillment of the stipulated export obligation. The<br \/>\nDGFT, vide order dated 19.2.1999, refused the request of the appellant for<br \/>\nan endorsement of the transferability of the advance licenses.\n<\/p>\n<p>Against the order of the DGTF dated 19.2.1999, the appellant filed a writ<br \/>\npetition in the High Court, which was dismissed. Hence, this appeal by way<br \/>\nof Special Leave.\n<\/p>\n<p>Under the Scheme for Duty Exemption Endorsement in the EXIM POLICY for the<br \/>\nyear 1997-2002, the advance licenses carry certain export obligations, and<br \/>\nfor certain goods the standard input and output norms (SION) for import and<br \/>\nexport for the grant of the duty-free licenses have been fixed, while for<br \/>\nsome other goods the norms have not been fixed.\n<\/p>\n<p>The petitioner had applied for licenses under the `no norms category&#8217; for<br \/>\nthe export of Fresh Frozen Sea Foods including Shrimps and PUD, and the<br \/>\nsaid licenses were granted by the Licensing Committee. The High Court in<br \/>\nparagraph 8 of it&#8217;s judgment observed that norms did exist for the export<br \/>\nproduct &#8220;Frozen Marine Products\/Frozen Meat packed in packing material made<br \/>\nout of LDPE\/HDPE\/PP Card Board other than Ivory Board&#8221;, and hence the<br \/>\nappellant should have applied in the `norms category&#8217; and not the `no norms<br \/>\ncategory&#8217;.\n<\/p>\n<p>There is no dispute that whether the advance licenses were issued under the<br \/>\n`norms category&#8217; or `no norms category&#8217;, in either case the said licences<br \/>\nwere transferable under the EXIM POLICY 1997-2002, which was issued under<br \/>\nSection 5 of the Foreign Trade (Development &amp; Regulation) Act, 1992.\n<\/p>\n<p>Clause 7.19(a) of the Duty Exemption Scheme contained in the aforesaid EXIM<br \/>\nPOLICY for the period 1.4.1997 to 31.3.2002 provided that &#8220;a duty free<br \/>\nlicence except Special Imprest Licence and\/or materials imported against it<br \/>\nis transferable after the completion of export obligation and endorsement<br \/>\nof transferability by the licensing authority&#8221;.\n<\/p>\n<p>Thus, from a reading of the above Scheme it is evident that duty free<br \/>\nlicenses are transferable whether they are in the `norms category&#8217; or `no<br \/>\nnorms category&#8217;. The only difference between the `norms category&#8217; and `no<br \/>\nnorms category&#8217; as per clause 7.4 of the Duty Exemption Scheme is that<br \/>\nwhere the SION norms have been published the application is to be given to<br \/>\nthe Licensing Authority, and where they have not been published the<br \/>\napplication is to be given to the Committee which functions as a<br \/>\nrecommending authority to the Licensing Authority.\n<\/p>\n<p>Clause 7.27 of the Duty Exemption Scheme reads as under:\n<\/p>\n<p>(i) &#8220;After export obligation has been fulfilled and the Undertaking<br \/>\nredeemed and subject to fulfillment of other conditions as laid down in<br \/>\nparagraph 7.25 above, the duty free license holder (except the Special<br \/>\nImprest License and Advance license used under paragraph 7.4) shall be<br \/>\nallowed transfer of the license, provided the request for endorsement of<br \/>\ntransferability is made within 36 months of the issuance of license, by the<br \/>\nlicensing authority. Upon such endorsement of transferability by the<br \/>\nlicensing authority, the concerned license holder may transfer:\n<\/p>\n<p>\t(a) The license in full, if no imports have been made;\n<\/p>\n<p>\t(b) The license in part, excluding the quantity and value of<br \/>\n\timports already made; and<\/p>\n<p>\t(c) The materials or the balance thereof already imported.\n<\/p>\n<p>(ii) Upon endorsement of transferability, issue of duplicate license,<br \/>\nenhancement in the cif value or amendments including revalidation shall not<br \/>\nbe allowed.\n<\/p>\n<p>(iii) Upon endorsement of transferability, a duty free license shall be<br \/>\nvalid for the balance period of it&#8217;s validity or for a period of six months<br \/>\nfrom the date of endorsement, whichever is later. However, licenses<br \/>\nsubmitted for endorsement of transferability after 30 months of the<br \/>\nissuance shall have a validity upto maximum period of 36 months form the<br \/>\ndate of issuance&#8221;.\n<\/p>\n<p>Thus, it is evident that all duty free licenses are transferable, whether<br \/>\nthey belong to the `norms category&#8217; or `no norms category&#8217;.\n<\/p>\n<p>By the order dated 19.2.1999 the DGFT rejected the application for<br \/>\nendorsement of transferability on the ground that the description of the<br \/>\nexport items was wrongly shown in the `no norms category&#8217;, whereas it<br \/>\nshould have been shown in the `norms category&#8217;, as it was Frozen Marine<br \/>\nProducts\/Frozen Meat packed in packing material made out of LDPE\/HDPE\/PP<br \/>\nCard Board other than Ivory Board.\n<\/p>\n<p>The DGFT was of the view that the license was granted to the appellant<br \/>\ncontrary to the Circular dated 31.3.1997 whereby the Licensing Authority<br \/>\nwas advised to issue advance licenses strictly as per the standard input<br \/>\noutput norms (SION) in respect of fish and marine products.\n<\/p>\n<p>In our opinion, the view taken by the High Court as well as the DGFT was<br \/>\nclearly erroneous in law and liable to be set aside. There is no dispute<br \/>\nthat the appellant was granted the advance licenses which were applied for.<br \/>\nIf there was any complaint that the licenses were not validly granted, then<br \/>\na show cause notice should have been issued to the appellant to show cause<br \/>\nwhy the said licenses should not be cancelled, and thereafter cancellation<br \/>\norder could have been passed. However, in the present case, neither was any<br \/>\nshow cause notice issued to the appellant nor the licenses were actually<br \/>\ncancelled.\n<\/p>\n<p>If a license is granted to someone certain rights accrue to the licence<br \/>\nholder, and deprivation of such right without a hearing is violation of<br \/>\nnatural justice. Before withdrawal of such right opportunity of hearing has<br \/>\nto be given. In the present case, no such opportunity was given at all. The<br \/>\nstand of the respondents is that grant of a licence does not confer any<br \/>\nvested right in favour of the licencee if the licence has been obtained by<br \/>\nmisrepresentation. We do not agree. The grant of a licence certainly<br \/>\ncreates certain rights in favour of the licencee, and if the Licensing<br \/>\nAuthority was of the opinion that the licence was obtained by<br \/>\nmisrepresentation, then a show cause notice should have been given to the<br \/>\nappellant, as well as an opportunity of hearing. In the present case<br \/>\nneither an opportunity of hearing was given to the appellant nor was the<br \/>\nlicence cancelled.\n<\/p>\n<p>As already stated above, under the Duty Exemption Scheme, whether the<br \/>\nlicence is in the `norms category&#8217; or `no norms category&#8217;, in either case<br \/>\nit is transferable. Hence, in our opinion, the DGTF wrongly refused the<br \/>\nappellant&#8217;s request for endorsement of transferability of the licences in<br \/>\nquestion.\n<\/p>\n<p>Learned counsel for the respondents submitted that, now the new EXIM POLICY<br \/>\n2002-2007 has come into force. However, a perusal of the same shows that<br \/>\nbroadly there is no difference between the Scheme of 1997-2002 and that of<br \/>\n2002-2007, so far as the matter in question is concerned.\n<\/p>\n<p><a href=\"\/doc\/313992\/\">In Union of India and Ors. v. Chowgule &amp; Co. Ltd. and Ors.,<\/a> [2003] 2 SCC<br \/>\n641, this Court held that even under the new policy, the appellant who had<br \/>\nan accrued right under the old policy was entitled to the benefits under<br \/>\nthe new policy.\n<\/p>\n<p>It is well settled that rights which have accrued under the old law<br \/>\ncontinue to exist unless there is an express or implied inconsistent<br \/>\nprovision in the new law vide `Principles of Statutory Interpretation&#8217; by<br \/>\nJustice G.P. Singh, 9th Edition (2004) p. 586. We find no material<br \/>\ninconsistency between the EXIM POLICY of 1997-2002 and that of 2002-2007 so<br \/>\nfar as the matter in question is concerned.\n<\/p>\n<p>For the reasons given above, this appeal is allowed. The impugned judgment<br \/>\nof the High Court dated 24.3.2000 as well as the order of the DGTF dated<br \/>\n19.2.1999 are set aside. The DGTF is directed to endorse the<br \/>\ntransferability of the licences in question as prayed for by the appellant.\n<\/p>\n<p>There shall be no order as to costs.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Supreme Court of India Baraka Overseas Traders vs Director General Of Foreign Trade &#8230; on 11 September, 2006 Author: M Katju Bench: Ashok Bhan, Markandey Katju CASE NO.: Appeal (civil) 1426 of 2001 PETITIONER: Baraka Overseas Traders RESPONDENT: Director General of Foreign Trade and Anr. DATE OF JUDGMENT: 11\/09\/2006 BENCH: Ashok Bhan &amp; Markandey Katju [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-113205","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Baraka Overseas Traders vs Director General Of Foreign Trade ... on 11 September, 2006 - Free Judgements of Supreme Court &amp; High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/baraka-overseas-traders-vs-director-general-of-foreign-trade-on-11-september-2006\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Baraka Overseas Traders vs Director General Of Foreign Trade ... on 11 September, 2006 - Free Judgements of Supreme Court &amp; 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