Saving clause for pre-restriction imports upheld where sandalwood purchase was conclusively committed before policy change.

Paragraph 1.5 of Chapter 1A of the Foreign Trade Policy, 2004-09 protected an import of sandalwood where the commercial transaction had been concluded before the later restriction came into force. The proforma invoice and remittance dated 30.03.2006, together with the customs invoice, bill of lading, phytosanitary certificate and exporter's confirmation, showed a firm pre-restriction commitment. An irrevocable letter of credit was not ative where the earlier conclusion of the transaction was otherwise established. The saving provision therefore applied, and confiscation, redemption fine and penalty were unsustainable.

---

---

Issues: Whether the importer was entitled to the benefit of paragraph 1.5 of Chapter 1A of the Foreign Trade Policy, 2004-09 so as to avoid confiscation, redemption fine and penalty for import of sandalwood without licence.

Analysis: The relevant documents showed that the proforma invoice and remittance were made on 30.03.2006, before the restriction on import of sandalwood was introduced by the policy circular dated 07.04.2006. The later customs invoice, bill of lading, phytosanitary certificate and exporter's confirmation supported the existence of a concluded commercial arrangement that had crystallised before the policy change. Paragraph 1.5 of Chapter 1A of the Foreign Trade Policy, 2004-09 protected imports that had been firmly committed before the restriction came into force, and the absence of an irrevocable letter of credit was not decisive where the transaction was otherwise established to have been concluded earlier.

Conclusion: The importer was entitled to the benefit of the policy saving provision, and the confiscation, redemption fine and penalty were unsustainable.

---