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of <h1>Board allows appeal, accepts ITC license for import, and remits full fine. Extension of credit post-notice not new contract.</h1> <h3>IN RE : M/s KANTILAL MANILAL & Co.</h3> IN RE : M/s KANTILAL MANILAL & Co. - 1981 (8) E.L.T. 95 (C. B. E. & C.) Issues: Interpretation of Public Notice No. 78/77 regarding importation against a letter of credit extended after the notice, consideration of firm commitments, and the impact of abnormal circumstances on contractual obligations.Analysis:1. Interpretation of Public Notice No. 78/77: The case involved the importation of Tetracycline Hydrochloride against a letter of credit extended after the issuance of Public Notice No. 78/77. The notice specified that imports could only be made against a license issued for drugs and drug intermediates. The appellants argued that the notice did not explicitly prohibit imports against a letter of credit opened before the notice and extended later. They relied on past handbooks and a clarification by CCI & E to support their contention that the extension of a letter of credit did not constitute a fresh commitment barring import clearance.2. Consideration of Firm Commitments: The Department contended that the benefit of the notice could not be extended to the case as the letter of credit was altered post-notice. However, the appellants maintained that there was a firm order and acceptance before the notice, and the extension of the letter of credit was necessitated by abnormal circumstances beyond their control, such as a damaged reactor at the supplier's factory.3. Impact of Abnormal Circumstances on Contractual Obligations: The Board acknowledged the existence of a firm commitment with a valid letter of credit before the notice was issued. It noted that the extension of the shipment period, the only amendment to the original terms of the letter of credit, was due to abnormal circumstances and did not fundamentally alter the contractual obligations. Therefore, the Board deemed it unreasonable to consider the extension as a fresh contract or to invalidate the importation based on the extension post-notice. Consequently, the Board allowed the appeal, accepted the ITC license for the import, and remitted the fine imposed on the appellants in full.
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