Import licence adjustment without express power or hearing violates the import control scheme and natural justice.

Import control authorities could not adjust the value of a validly issued import licence against a later entitlement unless that power was expressly conferred by the governing scheme or flowed from a lawful cancellation or debarment order. A composite licence without item-wise value allocation did not justify treating the unused item value as excess licensing, and the undertaking covered adjustment only if excess licensing was found on scrutiny. The adjustment and appellate orders were also invalid because they were made without notice or hearing, and natural justice applied where import entitlement was directly affected.

---

---

Issues: (i) Whether the adjustment of the value of the earlier import licences against the petitioner's subsequent import entitlement was authorised by the governing import control scheme and the undertaking given by the petitioner. (ii) Whether the impugned adjustment and the appellate orders were vitiated for want of notice and opportunity of hearing.

Issue (i): Whether the adjustment of the value of the earlier import licences against the petitioner's subsequent import entitlement was authorised by the governing import control scheme and the undertaking given by the petitioner.

Analysis: The governing import control provisions conferred specific powers to refuse, amend, suspend, keep in abeyance, debar, or cancel licences, but they did not confer any general power to adjust the value of a validly granted licence against a future entitlement without cancellation of the earlier licence. The undertaking relied upon by the respondents spoke of adjustment only if excess licensing was found on scrutiny of the registered exporter's application. The licences in question were composite licences for multiple items with no item-wise value allocation, and the petitioner's non-use of one item could not, by itself, justify treating the entire licence value as excess licensing. On the material before the Court, the authorities proceeded on an erroneous assumption that excess licensing for the full value had been established.

Conclusion: The adjustment was without jurisdiction and not supported by the undertaking or the import control scheme; the finding is in favour of the petitioner.

Issue (ii): Whether the impugned adjustment and the appellate orders were vitiated for want of notice and opportunity of hearing.

Analysis: The original adjustment order was passed without notice to show cause and without affording the petitioner an opportunity of being heard. The appellate orders were also made without hearing the petitioner, and no valid appellate order was shown to have been communicated or produced. Since the adjustment directly affected the petitioner's import entitlement, observance of natural justice was required even if the action was viewed as administrative rather than quasi-judicial.

Conclusion: The impugned orders were vitiated for breach of natural justice and are set aside in favour of the petitioner.

Final Conclusion: The petition succeeds, the impugned adjustment cannot stand, and the petitioner is entitled to the reliefs granted by the Court with costs.

Ratio Decidendi: A licensing authority cannot reduce or appropriate the value of a valid import licence against future entitlements unless such power is expressly conferred by the governing scheme or follows from a lawful cancellation or debarment order, and any action affecting civil rights must comply with natural justice.

---