Case: Union Of India &amp; Others Vs. M/S Chowgule &amp; Co. Ltd. &amp; Others

3. Respondent is a limited company incorporated underthe Companies Act, 1956. It is engaged, inter alia, in the export of processes iron one of Goan origin. It is also recognised as a trading house. Under the Import Export Policy for April 1988-March 1991 (hereinafter referred to as "the old policy") trading houses were eligible for the benefit inter alia of additional licences of defined value against the export of processes iron ore under the policy. Old policy was terminated and instead a new police starting w.e.f. April 1990- March 1993 (for short "the New Policy") was introduced. During the period 1.4.1989 to 31.3.1990 the respondents had exported processes iron ore of the value of Rupees 21,92,15,711.69. On 4.6.1990 the company applied to the Assistant Chief Controller or Imports & Exports for additional licence of a value of Rs. 2,12,63,924/- against the said exports. The application was rejected by the Assistant Chief Controller of Imports & Exports on 24th September, 1990 on the ground that application for additional licence for the licensing year 1990-1991 could not be considered on the basis the items appearing in Appendix 12 of the New Policy because the was no provision for grant of licence under the heading transitional arrangements in terms of the paragraph 222 of the New Policy. Respondents preferred an appeal which was dismissed on 21st January, 1991. Likewise second appeal was dismissed on 12th March, 1992. Review Petition filed by the respondents was also rejected on 9th June, 1993.4. Government of India, Ministry of Commerce, Directorate General of Foreign Trade, Udyor Bhavan, New Delhi issued REP Circular No.11/93 dated 5th May, 1993 (hereinafter referred to as "the Circular 11 of 93") providingWhere the applications for issue of Exim Scrips/REP etc. licences are pending in respect of exports made and export proceeds realised there against prior to 1.3.92, the 20% premium will be straightway paid, instead of issuing the licences, provided that licensing authority after processing the application and determining the eligibility for issue of licences is satisfied that the applicant is eligible for grant of Exim Scrips/REP etc. licences.On 14th July, 1993 respondents lodged its claim for 20% premium instead of additional licence for the licensing year April-March 1991 against exports of processed iron ore in the preceding licensing year April-March 1990. The claim of the company was rejected by the Deputy Director of Foreign Trade, Panaji vide letter dated 1st September, 1993 on the ground that minerals and ores appearing in Appendix 12 of the policy book 1990-1993 were ineligible for additional licence.6. Aggrieved against the aforesaid sets of orders the respondents filed the writ petitions in the High Court of Bombay, Panaji Bench, Goa seeking two-fold relief. Firstly, for quashing of the orders passed by the various authorities as mentioned above refusing their prayed for additional licence and secondly a writ of mandamus or any other appropriate writ directing the Union of India to forthwith pay to them premium of 20% of Rs. 2.12,63,924/- being the was value of the additional licence for April-March 1991 to which the respondents were entitled to under the Circular 11 of 1993.

Court's reasoning:
The application for the additional licence could be made only after the end of the fiscal year, as only thereafter the export house could know its entitlement. The High Court was, therefore, right in holding that the interpretation put by the authorities on the new policy in declining the claim of the respondents for the grant of additional licence was unacceptable. Under the new policy as well, the export houses/trading houses would remain entitled to the additional licence for the exports made during the period when the old policy was in force but subject to the condition that they would be allowed to import against the additional licence such items which are governed by the policy in force at the time of the import of thedo not find any infirmity in the orders passed by the High Court in quashing the orders passed by the authorities rejecting the claim of the respondents for grant of additionaldo not find any infirmity in the orders passed by the High Court in the issuance of writ of mandamus directing the Union of India to forthwith pay to the respondents the premium of 20% instead of issuing the additional licence in terms of the Circular 11 of 93. Circular 11 of 93 provides that where application for grant of additional licence are pending in respect of the exports made and export proceeds relating to the period prior to 1.3.1992 then instead of issuing the licences, the 20% premium shall be paid. The order passed by the High Court is strictly in conformity with the Circular 11 of 93 issued by the appellants