Judgment 1. The subject matter of challenge in this writ petition, which has been referred by a single Judge of this Court to a Division Bench of this Court, challenges Notification No. 25(RE-2007)/2004-2009 dated 29th August, 2007 issued by the Government of India, Ministry of Commerce and Industry, Department of Commerce, New Delhi, in exercise of power under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 read with paragraph 2.1 of the Foreign Trade Policy-2004-2009, whereby and under Schedule-I (Imports) of the ITC (HS) Classifications of Export and Import items has been amended, as a result importation of betel nuts has been allowed only through Mangalore Port and through nowhere else. This has prevented importation of betel nuts across the land border of India and Nepal. 2. The writ petitioner is an Importer of betel nuts from Nepal. He has contended that the said amendment infringes the treaty in between India and Nepal and at the same time unjustly supports south Indian growers of betel nuts at the cost of betel nuts growers of Nepal. 3. On 18th February, 2008 while the writ petition was referred to Division Bench, the learned single Judge while dealing with the writ petition passed an interim order staying the amendment, which interim order is continuing. 4. Union of India has filed several counter affidavits to justify the stand taken by it. It is the contention of Union of India that Nepal though grows betel nuts, it does not grow enough betel nuts for the needs of its citizens, which compels Nepal to import betel nuts from South Asian countries. It has been stated that there is no clinical or physical difference in between betel nuts grown in Nepal and those grown in other South Asian countries. It has been stated that the size of betel nuts grown in other East Asian countries is slightly larger than betel nuts grown in Nepal. It has been stated that betel nuts in excess quantity are being imported in Nepal for the purpose of smuggling the same to India. It has been stated that Indo-Nepal border is porous, through which betel nuts imported from other South Asian countries are smuggled in lots into India. It has been stated that by reason of such smuggling the South India betel nuts growers are facing financial hardship. It has been stated that Indo-Nepal border is porous, through which betel nuts imported from other South Asian countries are smuggled in lots into India. It has been stated that by reason of such smuggling the South India betel nuts growers are facing financial hardship. It has been stated that in order to stop smuggling of betel nuts of other South Asian countries into India through Nepal the measure complained of has been taken. 5. The above submissions read with the action taken makes it abundantly clear that although according to the perception of Union of India Nepal does not grow enough betel nuts for the needs of its citizens, it is still in a position to export the same to India and, accordingly, if betel nuts are carried from Nepal either by air or by land to Mangalore, such importation of betel nuts, though may have originated from other South Asian countries, would still be a product of Nepal exported to India. This argument is fallacious and suggests that the whole object and motive is to bring at par the cost of importation of betel nuts from Nepal with the cost of production of betel nuts in South India. 6. Indo-Nepal treaty promises exploration and undertaking of measures including technical co-operation to promote and diversify trade between two countries. It promises grant of maximum facility and to undertake all necessary measures for free and unhampered flow of goods needed by one country from the other, to and from their respective territories. The measure adopted to make betel nuts imported from Nepal more expensive and that too not from the territories of Nepal is contrary to the basic philosophy of the said treaty. The said treaty has specified routes through which trade witll be conducted between two countries. The routes so specified do not contemplate air lifting of goods from Nepal to a far flung territory in India for the purpose of exporting the same to India. The treaty does not contemplate packing up of trade articles at Nepal in containers or in locked up trucks and unloading of the same not acros the border of India but at a far flung place in India. The treaty does not contemplate packing up of trade articles at Nepal in containers or in locked up trucks and unloading of the same not acros the border of India but at a far flung place in India. The treaty provides, amongst others, as follow: "In order to facilitate the smooth flow of goods across the border the list of commodities subject to restrictions, prohibitions of exports to each others territories shall be immediately communicated through diplomatic channels as and when such restrictions or prohibitions are imposed or relaxed." 7. In the event Union of India was of the view that betel nut producted in Nepal is not sufficient to meet its own demands resulting in importation of betel nuts in large quantities, it was well within the competence of Union of India to restrict or prohibit importation of betel nuts from Nepal and to communicate the same to its Nepalees counter part through diplomatic channels. By taking the steps as complained of Union of India has acknowledged that Nepal has exportable betel nuts. It is, however, contrary to the provisions of the treaty is seeking to allow importation of betel nuts from Nepal by asking Nepalees betel nuts to be unloaded at Mangalore. 8. The learned counsel for Union of India has drawn our attention to the agreement of co-operation between the Government of India and the Government of Nepal whereby and under it has been provided that the contracting parties, while recognizing that there is long and open border between the two countries and there is free movement of persons and goods across the border and noting that they have the right to pursue independent foreign trade policy, agreed that either of them would take all other measures as are necessary to ensure that the economic interests of the other party are not adversely affected through unauthorized trade between the two countries. When the Union of India is aware that by utilizing unfavourable balance of trade and payment Nepal is importing betel nuts for the purpose of meeting the needs of its own citizens, in order to ensure that the economic interests of Nepal are not adversely affected through unauthorized trade of such betel nuts, we think Union of India before taking the stand, as has been taken in the instant case, ought to have had taken recourse to prohibit or restrict importation of betel nuts from Nepal. It was and still is unjust on the part of Union of India to allow importation of betel nuts from Nepal but at Mangalore and not at a point across the border in between Nepal and India. 9. We, therefore, allow the writ petition and quash the amendment, being the subject matter of challenge in the present writ petition.