DFIA licence revalidation certificate duty-free import dispute required from Customs for DGFT reconsideration
Customs was held obliged to issue a certificate to DGFT confirming that the DFIA licences could not be utilised while the duty-free import of Boric Acid remained under litigation. The request was limited to certification of the factual position needed for revalidation, not revalidation by Customs itself, because Para 2.13.1 of the Handbook of Procedures leaves revalidation to the licensing authority. The expiry of the licences could not fairly be attributed to the importer where non-utilisation resulted from provisional clearances and continued contest over the benefit. Physical custody of the licences was rejected as a prerequisite, as they had remained under constructive control for debit purposes during the dispute.
Issues: Whether Customs was bound to issue a certificate to the DGFT confirming that the DFIA licences could not be utilised because the admissibility of duty-free import of Boric Acid remained under litigation, so that the expired licences could be considered for revalidation under the Handbook of Procedures.
Analysis: The request was not for Customs to revalidate the licences itself, but only to certify the factual position that the licences could not be used because Customs had continued to contest the benefit and the imports had been allowed only provisionally. Under Para 2.13.1 of the Handbook of Procedures, revalidation is for the licensing authority, but the factual justification for such revalidation has to be furnished to that authority. The expiry of the licences could not fairly be attributed to the importer when non-utilisation resulted from continued litigation and refusal of duty-free clearance. The contention that physical custody of the licences by Customs was necessary was rejected, since the licences had effectively remained under constructive control of Customs for the purpose of debit while the dispute continued.
Conclusion: Customs was required to issue the requested certificate to the DGFT within two weeks so that the appellant could seek revalidation of the expired DFIA licences.
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