Court grants interim relief in challenge to onion export ban, allows exports under certain conditions.

The court granted interim relief in a case challenging a notification prohibiting onion exports. It directed that shipping bills filed before the notification should not be considered lapsed until the matter was decided. Consignments with shipping bills generated before the notification were allowed for export, subject to certain conditions. The court highlighted the significance of procedural compliance under the Customs Act and stressed the legal importance of shipping bills. Further proceedings were scheduled for December 2020.

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Issues Involved:
1. Challenge to the notification prohibiting the export of onions.
2. Validity of shipping bills filed before the issuance of the notification.
3. Allegations of insider information and arbitrary actions by customs authorities.
4. Procedural compliance under the Customs Act, 1962 and related regulations.

Detailed Analysis:

1. Challenge to the Notification Prohibiting the Export of Onions:
The petitioners challenged the notification No.31/2015-20 dated 14.09.2020 issued by the Director General of Foreign Trade, which prohibited the export of all varieties of onions with immediate effect. They argued that the notification was arbitrary, unreasonable, and contrary to the Foreign Trade Policy, 2015-20. The court acknowledged the petitioners' grievance and directed that shipping bills filed prior to the issuance of the notification should not be considered lapsed until the court decided the matter.

2. Validity of Shipping Bills Filed Before the Issuance of the Notification:
The petitioners contended that their shipping bills for the export of onions were filed before the issuance of the notification and should be allowed for export. The court noted that the shipping bills set in motion the process of exportation and held significant legal sanctity under section 50 of the Customs Act, 1962 and the Shipping Bill (Electronic Integrated Declaration and Paperless Processing) Regulations, 2019. The court directed that the consignments with shipping bills filed and generated before 22:28:11 hours on 14.09.2020 should be allowed for export, subject to the clarification given by the Central Board of Indirect Taxes and Customs in its communication dated 18.09.2020.

3. Allegations of Insider Information and Arbitrary Actions by Customs Authorities:
The petitioners alleged that the customs authorities had insider information about the impending notification and arbitrarily stopped processing Let Export Orders for their consignments on 14.09.2020. The court observed that the respondents did not specifically deny these allegations in their affidavits. The court took into account the procedural requirements under sections 50 and 51 of the Customs Act, 1962, and the 2019 Regulations, which emphasize the accuracy and completeness of information in shipping bills and the proper procedure for export clearance.

4. Procedural Compliance Under the Customs Act, 1962 and Related Regulations:
The court examined the procedural compliance under sections 50 and 51 of the Customs Act, 1962, which deal with the entry and clearance of goods for exportation. The court emphasized that a shipping bill is a crucial document that initiates the export process and must be treated with due sanctity. The court also referred to the internal communication from the Central Board of Indirect Taxes and Customs dated 18.09.2020, which clarified that procedural or policy modifications to the disadvantage of exporters should not apply to consignments already handed over to customs for examination and export before the notification date.

Conclusion:
The court issued a rule and granted interim relief, allowing the export of onions for shipping bills presented and generated before 22:28:11 hours on 14.09.2020. The matter was listed for further hearing in the first week of December 2020. The court's order emphasized the importance of procedural compliance and the legal sanctity of shipping bills in the export process.

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