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of <h1>Court orders reconsideration of export license rejection due to lack of proper consideration and arbitrary exercise of power.</h1> The court found in favor of the petitioner, criticizing the PRC for rejecting their request without proper consideration of software issues and delays. ... BIFR - discharge of export obligation - whether the petitioner has a legal right to the relaxation and concessions under Article 226 of the Constitution of India? - discrimination - similar relaxations and concessions as sought by the petitioner have been granted by the PRC to a large number of similarly circumstanced exporters - Held that: - It is well settled that discretionary power cannot be exercised arbitrarily. If facts - it appears that the PRC has rejected the prayer of the petitioner for procedural relaxation and concession without proper application of mind to the contentions of the petitioner - In a large number of cases, specific examples of which have been given in the writ petition and/or annexures thereto, PRC has considered exports under free shipping bills. Further the contention of the petitioner that exports were made under free shipping bills, only because the Advance License numbers were not accepted by reason of defects in the software, has been ignored. The PRC has not recorded any definite finding that the Advance License numbers could be accepted in the software. Petition allowed - The PRC is directed to reconsider its order dated 13.10.2015 in the light of the observations made above - decided in favor of petitioner. Issues Involved:1. Challenge to the PRC's order rejecting procedural relaxation and concessions.2. Legal right to relaxation and concessions under Article 226 of the Constitution of India.3. Allegations of discrimination and violation of Article 14 of the Constitution of India.4. Validity of the PRC's decision on the grounds of procedural lapses and software issues.5. Clubbing of licenses under the Handbook of Procedures.Issue-wise Detailed Analysis:1. Challenge to the PRC's Order:The petitioner challenged the PRC's order dated 13.10.2015, which rejected their application for procedural relaxation and concessions to get credit for exports already made against export obligations on certain Advance Licenses.2. Legal Right to Relaxation and Concessions:The petitioner argued that they had a legal right to the relaxation and concessions under Paragraph 4.1.9 (A) of the Foreign Trade Policy 2004-2009, which provided a five-year extension for sick industrial companies registered with the BIFR. The PRC's denial was contended to be wrongful, and the petitioner sought to enforce these rights under Article 226 of the Constitution of India.3. Allegations of Discrimination and Violation of Article 14:The petitioner alleged discrimination and violation of Article 14, claiming that similar relaxations and concessions were granted to other similarly situated exporters. Specific instances were cited where the PRC had granted such relaxations, but the petitioner was denied the same.4. Validity of the PRC's Decision on Procedural Lapses and Software Issues:The petitioner argued that due to changes in the alphanumeric numbering of import licenses and software used by the Import Controlling Authority, their exports were not recorded properly. This was not their fault but a system issue, and they should be granted the relaxation as a matter of legal right. The PRC's decision was also criticized for not considering the delay in issuing extension orders, which effectively reduced the extension period to 3.5 years instead of five years.5. Clubbing of Licenses:The petitioner sought the facility of clubbing licenses for redemption/regularization as provided in Paragraph 4.20 of the Handbook of Procedures. The PRC rejected this on grounds that the licenses were issued between 1989 to 1993, which was not permissible under the applicable provisions. The petitioner argued that the restrictions introduced by amendments on 13.10.2011 should be prospective and not apply to licenses issued before 2002.Judgment:The court found that the PRC had rejected the petitioner's request without proper application of mind and failed to consider the software issues and the delay in issuing extension orders. The court noted that discretionary power must not be exercised arbitrarily and that the petitioner had provided specific instances where similar relaxations were granted to other exporters. The court directed the PRC to reconsider its order, taking into account the observations made and allowing clubbing of licenses if the exports during the five-year period were related to the import licenses. The PRC was also directed to call for documents to verify the exports related to the imported raw materials and inputs against Advance Licenses.
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