Group company eligibility under export policy requires the enterprise itself to hold control rights, not individual partners.

For eligibility under the Target Plus Scheme, the defined "group company" test had to be satisfied by an enterprise that itself held the requisite voting rights or board control in the company. An individual partner could not be substituted for the enterprise, and the partnership firm could not qualify where it held no shares and only its partners held shares individually. On a plain reading of the policy definition, "enterprise" could not be stretched to include individuals. The result was that the partnership firm and its partners could not be treated as the company's group company, and the denial of Target Plus benefits was upheld.

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Issues: Whether a partnership firm, or its individual partners, could be treated as a "group company" of a company for entitlement to benefits under the Target Plus Scheme under the Foreign Trade Policy 2004-09.

Analysis: The eligibility clause for the Target Plus Scheme applied to Star Export Houses, while the definition of "group company" required two or more enterprises in which one could exercise 26% or more voting rights in the other or appoint more than 50% of its board. On a plain reading, the expression "enterprise" could not be stretched to mean an individual. Even if a firm were treated as an enterprise, it had to be the firm itself that held the requisite voting rights in the company. In the present case, the firm held no shares in the company; only its individual partners held shares. Treating such partners as the relevant enterprise would defeat the scheme structure and the purpose of the definition.

Conclusion: The partnership firm and its partners could not be treated as the company's "group company" for the scheme, and the denial of Target Plus benefits was upheld.

Ratio Decidendi: For eligibility under a scheme defining "group company" by ownership or voting-control criteria, the qualifying enterprise must itself satisfy the statutory or policy-based control requirement, and individual partners or shareholders cannot be substituted for the enterprise.

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