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1994 DIGILAW 360 (GUJ)

MAHAVIR EXPORTS v. UNION OF INDIA

1994-12-01

M.B.SHAH, N.N.MATHUR

body1994
N. N. MATHUR, J. ( 1 ) THE petitioner M/s. Mahavir Exports a propriety firm is engaged in business of exporting readymade garments and knitwears since 1980. For this purpose the petitioner-firm is registered as member of the Apparel Export Promotion Council. Respondent No. 2 - Apparel Export Promotion Council (hereinafter referred to as AEPC) is set up by the Union of India under the Export and Import Policy 1992-1997 (hereinafter referred to as Export and Import Policy ). The said Council has been set up with the basic objective to promote and develop exports of the country and each council is given responsibilities for the promotion of a particular group of products projects and services. The Council has been given the task of dealing with the product in question i. e. readymade garments and knitwear. The say of the petitioner-firm is that it is exporting the said items to Austria Canada USA West Germany and other scheduled countries. The petitioner exports the said products under the head of Non-Quota Exporters entitlement. The petitioner further says that it is the consistent practice of respondent No. 2 Council to issue circular every year to its members like the petitioner inviting applications for allotment of Non-Quota Exporters entitlement for export of garments and knitwear and pursuant to the said invitations the members like the petitioner are required to send the application to respondent No. 3 i. e. the Deputy Director Apparel Export Promotion Council Bombay Respondent No. 3 in turn sends it to respondent No. 2 i. e. AEPC. In the year 1992 all the exporters were required to submit the applications on or before 7. 9. 1992. The petitioner did not receive any circular from the Council till 7. 9. 1992 When the officers of the petitioner-firm enquired they were informed that the last date for submission to NQE entitlement application was 7. 9. 1992 Thus immediately the necessary formalities were completed and the application was dispatched to the Bombay office on 7. 9 which was received by the Bombay office on 8. 9. 1992 A communication dated 9. 12. 1992 was received from respondent No. 3 to the effect that since the application in question was received after 7. 9. 1992 the applicant cannot be accommodated for allotment under the system. 9 which was received by the Bombay office on 8. 9. 1992 A communication dated 9. 12. 1992 was received from respondent No. 3 to the effect that since the application in question was received after 7. 9. 1992 the applicant cannot be accommodated for allotment under the system. After receipt of the said rejection order the petitioner firm made certain representation to the respondent No. 3 and also approached the Ministry of Commerce. Having failed the petitioner approached this Court by way of Special Civil Application under Article 226 of the Constitution of India The petition was registered as Special Civil Application No. 5369/1993 ( 2 ) IN response to the notice pending admission it was submitted on behalf of the respondent that there is no obligation on the office of respondent No. 2 or 3 to issue any circular The date for submitting application was published in the Councils journal and also in newspapers i. e. Financial Express and Economic Times. It was further pointed out that for the year in question there remained no quota with the Council inasmuch as the entire quota has been exhausted amongst the eligible applicants who had applied within time In view of this learned counsel for the petitioner urged before the Division Bench that the petitioners case should be considered for quota for exports under NQE system on the basis that he had applied in time and that he was entitled to requisite quota for export of readymade garments for the succeeding year As the said question was not directly involved in the Special Civil Application the learned counsel for the petitioner submitted that the petitioner may be given an opportunity to apply afresh to the Council for getting benefits in the succeeding year ( 3 ) IN this circumstance this Court by order dated 29. 6. 1994 while permitting the petitioner to withdraw the petition directed that in the petitioner applies to respondent No 2 i. e. the Apparel Export Promotion Council for getting benefits for the succeeding year under the NQE system the Council may consider the same on merits in accordance with law ( 4 ) THE petitioner thereafter made a representation to respondent No. 2. The said representation was rejected by respondent No. 2 vide order dated 23. 8. The said representation was rejected by respondent No. 2 vide order dated 23. 8. 1994 stating inter-alia that in total 2104 applications were received from the trade for allotment of NQE entitlement for the year 1993 and all the applications received in time were considered and quotas were allotted to them. The petitioners application was rejected as the same was not received in time. It was also stated that there were some representations which were received from other exporters after the stipulated period but those representations were also rejected. It was further pointed out that quota is an annual affair and no quota relating to the year 1993 was available. According to the respondent since the entire quota has been released as per Import Export Policy and there being no provision for acceptance of applications after the date fixed the petitioners request could not be entertained. ( 5 ) IN the present writ petition the petitioner challenges the said order dated 23. 8. 1994 and seeks declaration that the petitioner is entitled for extra quota in the next exporting year 1995 over and above its usual entitlement for the said year and/or in any other subsequent exporting year. The petitioner further seeks declaration that the petitioner-firm is entitled for NQE Entitlement for the year 1993 on the basis of the performance for the year 1992 and therefore credit of the said quota be carried forward in the exporting year 1995 or 1996 or in succeeding years. The petitioner further seeks direction to give additional quota to the petitioner to the extent it has incurred loss in the year 1993 in the exporting year 1995 or 1996 or in succeeding years. ( 6 ) WE have heard Mr. H. J. Nanavaty learned counsel for the petitioner and Mr. G. L. Raval with Mr. K. M. Mehta learned counsel for the respondents. ( 7 ) IT is contended by Mr. Nanavati learned counsel for the petitioner that the Council has not considered the petitioners representation in right perspective as directed by this Court in Special Civil Application No. 5369/93. The Council was required to consider whether the loss which the petitioner suffered in the year 1993 on account of a days delay can be compensated by giving the petitioner the said quota in the succeeding year i. e. in the year 1994. The Council was required to consider whether the loss which the petitioner suffered in the year 1993 on account of a days delay can be compensated by giving the petitioner the said quota in the succeeding year i. e. in the year 1994. The grievance of the petitioner is that this issue was not at all considered by the Council. ( 8 ) LEARNED Counsel for the respondents has taken us through the Garment Export Entitlement Policy (1994-1996 ). It appears that the object of the policy is to earn foreign exchange and to create opportunity of employment in the country. The Ministry of Textiles Government of India issued a Notification dated 4. 9. 1994 incorporating conditions of the export of garments and knitwear to USA EEC Member States (Germany France Italy Benelux United Kingdom Irish Republic Denmark Greece Portugal and Spain) Austria Finland and Norway from 1. 1. 1994 to 31. 12. 1996. The distribution of Annual Levels has been given as under: distribution of Annual Levels (i) The Annual Levels in each category and country will be distributed under the following systems as per the percentage indicated against each of them. System Distribution of Annual Level (percentage) (a) Past Performance Entitlement (PPE) System 70 (of which High Value Entitlement) (10) (b) Manufacturer Exporters Entitlement (MEE) System 20 (of which MEE for new comers) (2) (c) Non-Quota Exporters Entitlement (NQE) System 10 (of which NQE for Handloom garments) (2) (d) First Come First Served (FCFS) System *nil - Total 100 - * There is no reservation for FCFS. However quantities that becomes available from flexibilities surrenders unallocated levels etc. shall be allocated on FCFS basis on pre-determined dates. No quantity will be released during the period January-March except in Slow Moving Items for which quantities will be released on 1st January. It is stated that quota is allocated under the Bi-lateral contracts arrived upon between the Government of Importing countries. It is evident from the table given above that the allocation under NQE system is 10% out of which 2% is further reserved for Handloom garments. Thus in fact it is only the 8% quota available under NQE system. Thus the controversy involved in the present Special Civil Application is only to very limited quota of 8% allocated under NQE entitlement system. Thus in fact it is only the 8% quota available under NQE system. Thus the controversy involved in the present Special Civil Application is only to very limited quota of 8% allocated under NQE entitlement system. Thus for the purpose of calculating 1995 entitlement under the Policy the export performance during the base period i. e. 1993 is taken into account. It further provides that available levels will be allotted pro-rata on the basis of value of exports during the basic period of individual applicants. It is contended by Mr. Raval learned counsel for the respondents that the petitioner was not found eligible for NQE quota for the year 1993 and therefore the petitioner cannot be permitted to proceed on the premises that it has incurred loss due to non-allocation of quota for the year 1993 and subsequent to it. It is further submitted that under the policy for allocation of NQE 1993 the base period was January 1992 to December 1992. Thus the submission of Mr. Raval is that the quota entitlement cannot be made available to the petitioner on the assumption that though the petitioner has not been found eligible for allocation in the year 1993 still the same be taken into consideration for allocation of 1995. He further submits that the quota is issued on the basis of bilateral agreement arrived at between the Government of India and the Governments of the Importing countries and thus a limited quota is available and the same is only on yearly basis. ( 9 ) THE dispute pertains to issuance of NQE Entitlement quota of the year 1993 for which the petitioner was required to submit the application on or before 7. 9. 1992. It is not in dispute that the application was not submitted on or before the said date i. e. 7. 9. 1992. The only plea of the petitioner is that they were not informed and as such could not make application in time. The last date was duly published in various Newspapers like Economic Times Financial Express Indian Express in its issue of 4. 8. 1992 and Apparel Weekly volume I (28) dated 27. 7. 1992. The policy does not contemplate for sending of circular. Otherwise also it is not practicable to give intimation individually to everyone. The last date was duly published in various Newspapers like Economic Times Financial Express Indian Express in its issue of 4. 8. 1992 and Apparel Weekly volume I (28) dated 27. 7. 1992. The policy does not contemplate for sending of circular. Otherwise also it is not practicable to give intimation individually to everyone. In the facts of the case publication of details including last date for submission of application through advertisement in prominent Newspapers like Economic Times Financial Express and Indian Express must be held to be sufficient circulation of the information more particularly when the petitioner is in the trade since long and is supposed to know the entire procedure. The petitioners application has been rightly rejected on the ground of delay for good and sufficient reasons by order dated 23. 8. 1994 There is no infirmity in the said order and it does not call for any interference. As the petitioner did not submit the application on or before the date fixed the petitioner was not found to be eligible for allocation of NQE entitlement for the year 1993 Now the petitioner seeks direction of grant of extra quota in the year 1995 above the usual entitlement on the basis of its performance in the year 1991. It may be stated that the very basis of the policy is to earn Foreign Exchange and create opportunity of employment in the country as on the basis of the entitlement one can manufacture the garments by having sufficient hands and then export. It is actual export and the foreign exchange realisation which is the requirement of the base period. For allocation of quota in the year 1993 the base period was 1991. Meaning thereby what has been exported and what amount of foreign exchange has been realised became basis of computing the entitlement. Similarly in the year 1994 what has been exported in the year 1992 was the basis. It is not that what is entitlement which becomes the benefit for the succeeding year but what is important is the entitlement and that for what amount the actual export has taken place and foreign exchange has been earned. Similarly in the year 1994 what has been exported in the year 1992 was the basis. It is not that what is entitlement which becomes the benefit for the succeeding year but what is important is the entitlement and that for what amount the actual export has taken place and foreign exchange has been earned. As the petitioners application was rejected the export was not carried out by it to scheduled countries in the year 1993 under the NQE entitlement system and as such in view of the policy the petitioner is not entitled to extra quota for the year 1995 on the basis of performance of 1991. It is contended by the learned counsel for the petitioner Mr. H. J. Nanavati that if the quota of 1993 is not carried forward to 1995 and/or subsequent year by giving extra quota above its usual entitlement the petitioner will suffer recurring loss. The contention has no substance. As pointed out above the allocation under NQE entitlement system is hardly 8% of the total quantity available. It is evident from the table given above that rest of the quantity under various categories is available on the basis of past performance and according to the respondent the petitioner is getting the said quota. ( 10 ) LASTLY Mr. G. L. Raval learned counsel for the respondent submits that the petitioner has been conspicuously silent with respect to NQE Entitlement for the year 1994. It appears that the petitioner got NQE Entitlement for the year 1994 on the basis of performance of the year 1992. Thus for the export which the petitioner carried out in the year 1994 it would be entitled again in 1996 and the present policy is upto 1996. ( 11 ) EVEN otherwise this Special Civil Application calls for no interference by this Court in exercise of the jurisdiction under Article 226 of the Constitution of India as on the basis of the trade policy of the Government the petitioner has no right much less the fundamental right either in the matter of grant of licence or quota for export. It may be noticed that in the present case the policy under which the petitioner claims relief is based on allocation of quota under Bi-lateral contract arrived upon between the Government of India and the Government of Importing Countries. It may be noticed that in the present case the policy under which the petitioner claims relief is based on allocation of quota under Bi-lateral contract arrived upon between the Government of India and the Government of Importing Countries. ( 12 ) IN view of the aforesaid discussion there is no merit in the writ petition and the same is accordingly dismissed. Notice discharged. There shall be no order as to costs. 13 Mr. H. J. Nanavati learned counsel for the petitioner submits that he wants to make representation to the Union of India against the order passed by the Council. It would be open for the petitioner to make such representation if so advised and the Government may decide such representation it made in accordance with the scheme. Petitiion Dismissed. .