Court allows use of imported raw materials for SEZ and Export Units post-policy change

The court concluded that the petitions became infructuous due to the subsequent notification dated 27-1-2021, which allowed the import and utilization of specific raw materials for SEZ and Export Oriented Units. It directed the respondent authorities to permit the petitioners to use previously imported raw materials and discharged the undertakings. The court highlighted that the change in policy now enabled the utilization of these materials, which were previously unused following court directions.

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Issues Involved:
1. Challenge to Rule 2(vi)(a) of the Hazardous and Other Wastes (Management and Transboundary Movement) Amendment Rules, 2019.
2. Permissibility of import of raw materials (virgin plastic waste and scrap) by SEZ units.
3. Impact of subsequent notification dated 27-1-2021 on the import and utilization of raw materials.
4. Directions for utilization of previously imported raw materials and discharge of undertakings.

Issue-Wise Detailed Analysis:

1. Challenge to Rule 2(vi)(a) of the Hazardous and Other Wastes (Management and Transboundary Movement) Amendment Rules, 2019:
The petitioners challenged Rule 2(vi)(a) of the 2019 Amendment Rules, which omitted the permission for SEZ and Export Oriented Units to import certain plastic wastes. They argued that this rule was ultra vires several sections of the Environment (Protection) Act, 1986, the SEZ Act, 2005, the SEZ Rules, 2006, and the Foreign Trade (Development and Regulation) Act, 1992, as well as Articles 14 and 19(1)(g) of the Constitution of India.

2. Permissibility of Import of Raw Materials by SEZ Units:
The petitioners, having licenses to import raw materials (new/virgin plastic scrap/waste) for their SEZ operations, faced objections from Customs authorities post the 2019 Amendment Rules. These authorities contended that such imports were no longer permitted even for SEZ units. The petitioners sought a writ of mandamus to declare their right to import such materials under their existing approvals and to direct Customs to allow the import and utilization of these materials.

3. Impact of Subsequent Notification Dated 27-1-2021:
A significant development occurred with the issuance of a new notification on 27-1-2021, which allowed the import of 'post-industrial or pre-consumer polyethylene wastes' and 'Polymethyl Methacrylate' for SEZ and Export Oriented Units. This notification effectively lifted the restrictions imposed by the 2019 Amendment Rules, permitting the petitioners to import and utilize these materials.

4. Directions for Utilization of Previously Imported Raw Materials and Discharge of Undertakings:
Following the 27-1-2021 notification, the petitioners moved applications seeking permission to use the raw materials that had been imported and were lying unused due to the court's directions. The court acknowledged the change in policy and directed the respondent authorities to permit the petitioners to use these raw materials. The court also discharged the undertakings given by the petitioners, noting that the materials were now freely importable and usable under the new rules.

Conclusion:
The court concluded that, given the subsequent notification dated 27-1-2021, the petitions had become infructuous. It directed the respondent authorities to allow the petitioners to use the previously imported raw materials and to remove any seals placed on these materials. The undertakings filed by the petitioners were also discharged. The court emphasized that the change in policy now permitted the use of these materials, which had been kept unused pursuant to its earlier directions.

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