High Court: Unjustified Rejection of Import License Application for Marble Blocks. Eligibility criteria met. Quashed rejection.

The High Court held that the rejection of the petitioner's application for an import license for marble blocks for the year 2010-11 was unjustified. Despite discrepancies in domestic sales turnover figures, the petitioner met the eligibility criteria and was entitled to the license. The Court quashed the rejection communications and directed the respondents to grant the license to the petitioner, emphasizing that the penalty imposed was unwarranted. The petition was allowed with no costs imposed.

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Issues:
Impugned communication rejecting license to import marble blocks for 2010-11, Eligibility criteria for import license, Discrepancy in domestic sales turnover, Misdeclaration and penalty imposition, Justification of rejecting license application.

Impugned Communication Rejecting License:
The petitioner challenged the communication dated 10.5.2010 by the Director General of Foreign Trade (DGFT) rejecting the application for a license to import marble blocks for the year 2010-11. Subsequent communications reiterating the rejection were also contested by the petitioner. The High Court noted that the petitioner, a public limited company engaged in manufacturing marble tiles and slabs, had been issued licenses for importing marble blocks in previous years. The petitioner's eligibility for the license was based on specific criteria laid down by the Central Government.

Eligibility Criteria for Import License:
The eligibility criteria for obtaining a license to import marble blocks included having installed a marble gang saw machine by a specified date and achieving a certain level of indigenous sales turnover in previous financial years. The petitioner met these criteria as they had two gang saw machines and a domestic sales turnover well above the required amount. The High Court emphasized that the discrepancy in the domestic sales turnover figures submitted by the petitioner did not impact their entitlement to the import quota, as the actual turnover exceeded the prescribed threshold.

Discrepancy in Domestic Sales Turnover:
The High Court addressed the discrepancy in the domestic sales turnover figures provided by the petitioner, noting that although there were differences between the figures in the balance sheet and the Chartered Accountant's Certificate, the actual turnover was significantly higher than the required amount. The Court found that the discrepancy did not affect the petitioner's eligibility for the import quota, and any discrepancies were attributed to negligence rather than an intentional misrepresentation.

Misdeclaration and Penalty Imposition:
The Director General of Foreign Trade had imposed a token penalty of Rs. 1 lakh on the petitioner for discrepancies in turnover figures, acknowledging that there was no malafide intention on the petitioner's part. The High Court observed that the penalty imposed was unjustified given that the discrepancies did not impact the petitioner's entitlement to the import quota. The Court noted that the penalty was paid by the petitioner under protest.

Justification of Rejecting License Application:
The High Court concluded that the rejection of the petitioner's application for the import license was not justified, considering that the discrepancies in turnover figures did not affect the petitioner's eligibility. The Court quashed the impugned communications rejecting the license application and directed the respondents to grant the license for importing marble blocks for the year 2010-11 to the petitioner. The petition was allowed, and no costs were imposed.

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