Retrospective export incentive cap held unsustainable; claim must be examined on merits through a reasoned speaking order.
A retrospective monetary cap on export incentive entitlement under the Foreign Trade Policy was found inconsistent with the scheme's object and the policy framework, so the restriction was quashed as without jurisdiction, arbitrary, illegal and capricious. The authority could not reject the exporter's claim merely because the amount claimed exceeded the stated monetary figure during the relevant financial year; it had to examine the claim on merits, undertake the prescribed scrutiny, and pass a reasoned speaking order. The writ petition succeeded, and the competent authority was directed to decide the incentive claim afresh in accordance with the scheme.
Issues: (i) Whether the communication restricting the export incentive entitlement to Rs. 1 crore was sustainable; (ii) whether the petitioner's claim for export incentive could be rejected merely because the amount claimed exceeded Rs. 1 crore during the relevant financial year.
Issue (i): Whether the communication restricting the export incentive entitlement to Rs. 1 crore was sustainable.
Analysis: The incentive scheme was introduced to promote incremental exports under the Foreign Trade Policy. A later clarification imposed a monetary cap with retrospective effect. The Court applied the earlier coordinate-division-bench decision on the same scheme and found the restriction inconsistent with the policy framework and the scheme's object.
Conclusion: The restriction was held to be without jurisdiction, arbitrary, illegal and capricious, and it was quashed.
Issue (ii): Whether the petitioner's claim for export incentive could be rejected merely because the amount claimed exceeded Rs. 1 crore during the relevant financial year.
Analysis: The governing policy required the authority to examine the claim and undertake the prescribed scrutiny before passing a reasoned order. The claim could not be defeated solely on the ground that the total amount claimed exceeded the stated monetary figure.
Conclusion: The application was directed to be considered on merits and could not be rejected on that ground alone.
Final Conclusion: The writ petition succeeded, the restrictive communication was set aside, and the competent authority was directed to decide the incentive claim afresh by a reasoned and speaking order after undertaking the prescribed scrutiny.
Ratio Decidendi: A retrospective monetary restriction on an export incentive claim, inconsistent with the scheme and policy framework, cannot stand where the authority is obliged to consider the claim on merits and pass a reasoned decision under the prescribed procedure.
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