Court deems suspension of Importer-Exporter Code Numbers unlawful, stresses due process

The Court found that the suspension of Importer-Exporter Code Numbers without proper notice and opportunity for representation violated the Foreign Trade (Development and Regulation) Act, 1992. Despite allegations of fraudulent activities, the impugned orders were deemed unsustainable due to procedural irregularities. An interim direction was issued to keep the orders in abeyance pending completion of the investigation. The Court stressed the importance of following due process and procedural fairness in matters concerning the suspension or cancellation of code numbers under the Act. The case was disposed of with no costs, allowing the respondent to continue the investigation if necessary.

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Issues:
1. Suspension of Importer-Exporter Code Numbers without proper notice and opportunity for representation.
2. Compliance with the provisions of the Foreign Trade (Development and Regulation) Act, 1992.
3. Validity of interim injunction and keeping impugned orders in abeyance pending investigation.

Analysis:
1. The petitioners challenged the orders suspending their Importer-Exporter Code Numbers, arguing a violation of the Foreign Trade (Development and Regulation) Act, 1992. The Court highlighted Section 8 of the Act, emphasizing the necessity for informing the affected party in writing and providing a reasonable opportunity for representation before suspending or canceling the code numbers. It was noted that the petitioners were not given this opportunity before the impugned orders were passed, rendering the orders unsustainable.

2. The respondent justified the suspension citing fraudulent activities by the petitioners and an ongoing investigation. The Court acknowledged the seriousness of the complaint but emphasized the importance of following due process under Section 8(b) of the Act. Despite the allegations, the Court ruled that the impugned orders could not stand due to the lack of proper procedure followed. An interim direction was given to keep the orders in abeyance until the completion of the investigation and issuance of final orders. The respondent was permitted to proceed with the investigation while ensuring compliance with legal requirements.

3. The Court noted the lack of information on the progress of the investigation post the interim order. However, it was emphasized that the impugned orders remained stayed since 2006 due to the absence of a counter affidavit from the respondent. The Court disposed of the Writ Petitions with no costs, allowing the respondent to continue the investigation if still pending. The judgment highlighted the importance of adhering to procedural fairness and legal requirements in matters of suspension or cancellation of Importer-Exporter Code Numbers under the Act.

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