Case: Prem Chand Somchand Shah and Another Vs. Union of India and Another

2. The petitioners in both these writ petitions are partnership firms carrying on business of import of rough diamonds and export of cut and polished diamonds. The Import and Export Policy for the period April 1978 to March 1979, in para 174, made provision for grant of certain import facilities to Export Houses which were registered in accordance with the provisions of the said Policy. One of the said facilities was grant of an Additional Licence in terms of para 176 of the said Policy for an amount to be calculated at one-third the f.o.b. value of the exports of select products made by the Export House in the year 1977-78. The petitioners submitted application for registration as Export Houses and for grant of Export House Certificate which would have entitled them to the grant of such Additional Licence. The said applications of the petitioners were rejected by the authorities on the view that petitioners had failed to diversify their export of "Other Products" during the year 1977-78. The said order refusing the Export Certificate was challenged by the petitioners by filing writ petitions under Article 226 of the Constitution before the Bombay High Court. One of those writ petitions (filed by the petitioners in Writ Petition No. 460 of 1988 herein) was dismissed by a learned Single Judge of the High Court and the said petitioners file an appeal before a Division Bench of the High Court. While the said appeal and the other writ petition (filed by the petitioners viz. Writ Petition No. 459 of 1988 herein) were pending in the Bombay High Court, this Court decided Civil Appeal No. 1423 of 1984, Union of India v. Rajnikant Brothers 1986 Supp(SCC) 692), and other connected matters by order dated April 18, 1985, wherein it was observed that there was no requirement of diversification of exports as a condition for the grant of Export House Certificates in the Import Policy for the year 1978-79, and the authorities were directed to issue necessary Export Certificates for the year 1978-79. In that order this Court laid down the following condition : (SCC pp.The petitioners in both these writ petitions are partnership firms carrying on business of import of rough diamonds and export of cut and polished diamonds. The Import and Export Policy for the period April 1978 to March 1979, in para 174, made provision for grant of certain import facilities to Export Houses which were registered in accordance with the provisions of the said Policy. One of the said facilities was grant of an Additional Licence in terms of para 176 of the said Policy for an amount to be calculated at one-third the f.o.b. value of the exports of select products made by the Export House in the year 1977-78. The petitioners submitted application for registration as Export Houses and for grant of Export House Certificate which would have entitled them to the grant of such Additional Licence. The said applications of the petitioners were rejected by the authorities on the view that petitioners had failed to diversify their export of "Other Products" during the year 1977-78. The said order refusing the Export Certificate was challenged by the petitioners by filing writ petitions under Article 226 of the Constitution before the Bombay High Court. One of those writ petitions (filed by the petitioners in Writ Petition No. 460 of 1988 herein) was dismissed by a learned Single Judge of the High Court and the said petitioners file an appeal before a Division Bench of the High Court. While the said appeal and the other writ petition (filed by the petitioners viz. Writ Petition No. 459 of 1988 herein) were pending in the Bombay High Court, this Court decided Civil Appeal No. 1423 of 1984, Union of India v. Rajnikant Brothers 1986 Supp(SCC) 692), and other connected matters by order dated April 18, 1985, wherein it was observed that there was no requirement of diversification of exports as a condition for the grant of Export House Certificates in the Import Policy for the year 1978-79, and the authorities were directed to issue necessary Export Certificates for the year 1978-79. In that order this Court laid down the following condition : (SCC pp.

Court's reasoning:
7. Shri Salve has invited our attention to the Import Licence dated November 21, 1988 issued in favour of M/s. Suraj Diamonds Industries Pvt. Ltd. wherein it is stated that this licence is valid for import of items as per para 215 of Import and Export Policy 1988-91 subject to restrictions/conditions laid down therein. It has been submitted that this licence has also been issued under the Import and Export Policy 1978-79 on the basis of the f.o.b. value of exports. It has been urged that the petitioners as well as the said licensee, namely M/s. Suraj Diamonds Industries Pvt. Ltd. are persons similarly situate and whereas M/s. Suraj Diamonds Industries Pvt. Ltd. have been granted an Additional Licence whereunder it is permissible to import items as per para 215 of the Import and Export Policy 1988-91, the said facility has been denied to the petitioners and that the petitioners have been subjected to arbitrary and hostile discrimination. The learned Additional Solicitor General has pointed out that the said licence to M/s. Suraj Diamonds Industries Pvt. Ltd. was issued under a mistake and the said mistake has been rectified on December 2, 1988, i.e., within 10 days of the issue of the said licence. In view of the fact that the licence issued in favour of M/s. Suraj Diamonds Industries was issued under a mistake and the said mistake has been rectified, it cannot be said that the petitioners have been subjected to hostile discrimination vis-a-vis other Export Houses similarlyShri H.N. Salve, has, however, urged that the view of the decision of this Court in D. Navinchandra & Co. case ( 1987 (3) SCC 66 : 1987 (2) SCR 989 ) the Export Houses who were granted Additional Licences under the Import and Export Policy 1978-79 have to be treated at par with Export Houses who have been granted Additional Licences under the Import and Export Policy for the subsequent years and since there has been relaxation in the matter of policy of canalisation of imports under sub-para (4) of para 215 in respect of Additional Licences granted to Export Houses under the Import and Export Policy 1988-91, the petitioners are also entitled to a similar relaxation. We are unable to agree withHere we find that in the Import and Export Policy 1988-91 there has been relaxation to a limited extent in respect of imports by Export Houses who are granted Additional Licences under the said Policy on the basis of their exports during that period 1987-88 and subsequent periods. Since the basis for the grant of Additional Licences which are entitled to this relaxation is different from the basis on which Additional Licences were granted to the petitioners, the petitioners cannot claim the benefit of the same relaxation and assail the validity of sub-para (10) of para 218 of the Import and Export PolicyBefore we conclude, we may take note of the recent decision of this Court in B. Vijay Kumar & Co. v. Collector of Central Excise and Customs ((1991) 1 Scale 33). The appellants therein had been granted Additional Import Licence in pursuance of this Courts order dated April 18, 1985 in Rajnikant Brothers case 1986 Supp(SCC) 692) and had imported canalised items under the said licence. The goods were not cleared by the customs authorities and the Collector of Customs imposed penalty and passed orders for confiscation of the foods and permitted the appellants to take delivery of goods on payment of redemption fine. The Customs, Excise and Gold (Control) Appellate Tribunal (hereinafter referred to as the Appellate Tribunal) on appeal, while upholding the order of imposition of redemption fine, set aside the order of Collector imposing penalty. In view of the special facts and circumstances of the case and specially having regard to the findings of the Appellate Tribunal that the appellants imported canalised items bona fide, this Court set aside the orders of the Collector and the Appellate Tribunal with regard to confiscation of goods and imposition or redemption fine without dealing with the submissions of learned counsel for the parties with regard to the interpretation and the effect of the earlier judgments of this Court in Raj Prakash Chemicals case ( 1986 (2) SCC 297 : 1986 (1) SCR 448 ) Indo-Afghan case (Indo Afghan Chambers of Commerce v. Union of India, 1986 (3) SCC 352 : 1986 (3) SCR 88 ), Godrej Soap case (Star Diamond Co., India v. Union of India, 1986 (4) SCC 246 : 1986 SCC(Cri) 431) and D. Navinchandra & Co. case ( 1987 (3) SCC 66 : 1987 (2) SCR 989 ) This decision is, therefore, a decision based on the facts of that particular case only