Export control classification and promissory estoppel: essential nature of the commodity governed, and policy change was upheld in public interest.

Argenti Nitras was treated as silver nitrate and classified as a silver compound falling within the export control entry, because classification depended on the substance's essential nature rather than its medicinal use or trade name; the commodity therefore remained subject to the export control order, including after amendment to a different schedule item. Promissory estoppel did not prevent the Government from changing the export policy, because the policy was expressly temporary, reserved the power of change, denied any enforceable right from pre-ban commitments, and the petitioners failed to show a sufficient change of position against a sovereign policy made in public interest. The challenge to the export ban accordingly failed.

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Issues: (i) Whether Argenti Nitras fell within item 77(ii) of Schedule I, Part B of the Export Control Order, 1977 as a silver compound containing more than 50 per cent silver. (ii) Whether the Government was bound by promissory estoppel to honour pre-ban export commitments despite the change in export policy.

Issue (i): Whether Argenti Nitras fell within item 77(ii) of Schedule I, Part B of the Export Control Order, 1977 as a silver compound containing more than 50 per cent silver.

Analysis: The expression "silver compound" was construed broadly by reference to the nature of the article and the object of the export control scheme. Argenti Nitras was treated as silver nitrate, which is a silver compound, even though it was used as a drug. The classification under the export order depended on the substance's character and not on its medicinal use or trade name. The same goods remained governed by the export control order before and after the amendment, differing only in placement from Part B to Part A.

Conclusion: Argenti Nitras was covered by item 77(ii) and, after the amendment, by item 55 of Part A.

Issue (ii): Whether the Government was bound by promissory estoppel to honour pre-ban export commitments despite the change in export policy.

Analysis: Promissory estoppel required a clear and unequivocal representation and a real change of position. The export policy was framed for a limited period, expressly reserved the power of change, and stated that no enforceable right arose from pre-ban commitments. The change of export policy was a matter of sovereign and public interest, not ordinary administrative action. The petitioners also had not shown a sufficient practical alteration of position that could attract estoppel against the State in the circumstances of a changeable policy.

Conclusion: Promissory estoppel did not apply against the Government in relation to the change in export policy.

Final Conclusion: The challenge to the export ban failed, and the writ petitions were rejected because the commodity was within the export control item and the Government was not estopped from changing the policy in public interest.

Ratio Decidendi: A commodity governed by a broad export-control entry is to be classified by its essential nature, not by its use or commercial description, and promissory estoppel cannot prevent the State from altering an expressly changeable sovereign policy made in public interest.

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