Trade policy relaxation power may coexist with ban-specific clause, but factual scrutiny must precede export permission

Clause 2.5 of the Foreign Trade Policy, 2004-2009 was treated as a general relaxation power capable of operating alongside Clause 1.5 on relaxation during a ban, because the specific ban-related clause was not exhaustive. The competent authority was therefore required to consider the request on its merits, including the claimed hardship and trade impact. The court also indicated that direct permission to complete the export order was inappropriate without first examining the authenticity of the supporting documents and the factual basis for relaxation, so the matter had to be reconsidered by the authority through a speaking order.

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Issues: (i) Whether the general relaxation power under Clause 2.5 of the Foreign Trade Policy, 2004-2009 could be invoked in a case involving a temporary export ban despite Clause 1.5 dealing with relaxation during a ban. (ii) Whether the writ court could directly permit completion of the export order without the competent authority first examining the authenticity of the supporting documents and the factual basis for relaxation.

Issue (i): Whether the general relaxation power under Clause 2.5 of the Foreign Trade Policy, 2004-2009 could be invoked in a case involving a temporary export ban despite Clause 1.5 dealing with relaxation during a ban.

Analysis: Clause 2.5 empowered the Director General of Foreign Trade to grant relaxation on grounds of genuine hardship and adverse impact on trade. Clause 1.5 dealt specifically with requests for relaxation during a period covered by a ban, but it was not exhaustive. The existence of Clause 1.5 did not exclude the wider power under Clause 2.5, and the authority was required to consider the representation on its merits.

Conclusion: The restriction placed on Clause 2.5 was unsustainable, and the matter had to be considered under the policy framework in a broader manner.

Issue (ii): Whether the writ court could directly permit completion of the export order without the competent authority first examining the authenticity of the supporting documents and the factual basis for relaxation.

Analysis: Although there was no specific finding that the exporters had indulged in malpractice or produced antedated documents, the factual basis for relaxation still required examination by the competent authority. Directly granting permission to export without assessing the quality and authenticity of the supporting documents went beyond the proper scope of judicial intervention at that stage.

Conclusion: The direction granting immediate permission to export was set aside, and the competent authority was required to reconsider the matter and pass a speaking order.

Final Conclusion: The appeal succeeded only to the extent of setting aside the direct permission to export, while the direction for fresh consideration by the competent authority was maintained.

Ratio Decidendi: A general relaxation power in trade policy may operate alongside a specific ban-related provision unless the policy expressly makes the specific provision exhaustive, but direct judicial permission should not be granted where the factual foundation for relaxation remains to be examined by the competent authority.

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