2024-VIL-730-AP-CU
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CUSTOMS High Court Cases

Customs/DGFT - Challenge to Notification No. 20/2023 amending Export Policy of Non-basmati rice under HS Code 1006 30 90 from Free to Prohibited - Whether the impugned Notification is in conformity with the Foreign Trade Policy and if not, the same is liable to be set aside – HELD – a conjoint reading of the statutory provisions, the Notifications and the Foreign Trade Policy would go to show that the Central Government is empowered to formulate and announce the Foreign Trade Policy and amend the existing policy and the same is not in dispute - the contention advanced on behalf of the petitioners that the impugned Notification is not in conformity with the Foreign Trade Policy-2023 has no merit in as much as the statutory provision coupled with Para 1.02 of the Foreign Trade Policy-2023 empowers the Central Government to amend, change its Foreign Trade Policy from time to time - In the present case, as is evident from the impugned Notification, the existing policy with regard to export of Non-Basmati White Rice is changed in “public interest? and the export of the same is prohibited by carving out certain exceptions. Therefore, the impugned Notification cannot be held to be contrary to the Foreign Trade Policy - the impugned Notification shall have prospective effect only, in so far as the Writ petitioners are concerned, and the same shall not impede the petitioners’ export of Non-Basmati White Rice in fulfillment of their contractual obligations with the foreign buyers, provided the Letters of Credit are issued in their favour prior to 20.07.2023 – the writ petitions are disposed of - Whether the policy can be given retrospective effect and allowed to take away the vested rights – HELD – the petitioners claim that Letters of Credit were issued in their favour by the foreign buyers prior to the issuance of the impugned Notification and the same is not in dispute - pursuant to the agreement / contracts entered with the foreign buyers petitioners have procured the Non-Basmati White Rice and therefore vested rights accrued to them in terms of the Foreign Trade Policy 2023, which provides import / export on or after the date of the regulation / restriction will be allowed for importer / exporter, who has a commitment through an irrevocable Commercial Letter of Credit before the date of imposition of such restriction / regulation - the impugned Notification cannot have the retrospective effect. The Foreign Trade (Development and Regulation) Act, 1992 does not confer any right to the authorities or enable them to issue any Notification which has the effect of imposing prohibition with retrospective effect or take away the vested rights accrued to the petitioners by virtue of the Foreign Trade Policy, 2023 prior to the issuance of the impugned Notification. Point No.2 is answered accordingly - Whether the policy decision can be set aside, if the same is found arbitrary or violative of Fundamental Rights – HELD - The conditions imposed in the impugned Notification are clearly distinctive and enables the exporters who have already made arrangements for shipment of Non-Basmati White Rice in fulfillment of their contractual obligations. In the present set of cases, the petitioners are still at the stage of procurement of the NonBasmati White Rice and they cannot be equated with those of exporters who made all arrangements for shipment. Therefore, the contention that the action of the respondents is arbitrary and hit by Article 14 of the Constitution of India cannot be accepted. The Point No.3 is accordingly answered - Whether the policy decision can be interfered with, if the same is violative of principles of natural justice or Doctrine of Legitimate Expectation – HELD - In the light of the expression of the Hon’ble Supreme Court that the legitimate expectation is not a legal right and that shall yield to the public interest, the point No.4 is answered against the petitioners and no prior notice need be issued.
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