Export obligation extension requests must be decided on merits before coercive action is taken

Export obligation defaults under the relevant scheme do not automatically bar consideration of a request for extension of time. Where the petitioners had submitted representations explaining the circumstances preventing timely compliance, the competent authority was required to examine those requests on merits and pass a reasoned order. An endorsement made by an employee while seeking adjournment of show cause proceedings did not forfeit the petitioners' entitlement to seek extension. The writ court declined to decide the adequacy of the explanations at that stage, as sufficiency of reasons was for the authority to determine. Coercive action was kept in abeyance until the representations were considered and decided.

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Issues: Whether the petitioners were entitled to have their request for extension of time to fulfil export obligations considered on merits and whether coercive action should be kept in abeyance pending such consideration.

Analysis: The petitioners had admitted non-fulfilment of export obligations within the stipulated time but had placed representations before the authorities seeking extension of time and explaining the circumstances preventing compliance. The Court held that an endorsement made by an employee while seeking adjournment of the show cause proceedings could not forfeit the petitioners' right to seek extension. It further held that the sufficiency or insufficiency of the reasons advanced by the petitioners was a matter for the competent authority to examine, and not for determination in writ proceedings at that stage. In fairness, the authority was required to consider the representations and decide the request by a reasoned order.

Conclusion: The petitioners were entitled to have their request for extension of time considered by the competent authority, and coercive action was stayed until such consideration and decision.

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