Court declines interference with EPCG license jurisdiction challenge, emphasizes completion of adjudication process

The court declined to interfere with notices challenging the jurisdictional validity of EPCG license export obligation fulfillment, citing limited grounds for interference at the Show Cause stage. The court emphasized completing the adjudication process logically and directed the petitioners to cooperate within a specified timeline. Interference by the Writ Court was deemed limited, and the petition was disposed of without costs, clarifying that allegations were not admitted due to the absence of affidavits. No coercive action was to be taken until after communicating the adjudication order.

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Issues:
1. Jurisdictional validity of notices dated 19th August, 2019 and 1st January, 2021.
2. Applicability of Foreign Trade Policy regarding export obligation fulfillment.
3. Interference by Writ Court at the Show Cause stage.

Jurisdictional Validity of Notices:
The petitioner held an EPCG license with export obligations, initially fulfilled through group companies. Subsequently, the fulfillment was certified by the Foreign Trade Development Officer. However, a notice was issued stating that the export obligation was wrongly discharged by the group companies beyond a certain date. The petitioners challenged the jurisdiction of the notices, citing a relevant judgment. The respondents argued that the EPCG license fell under a specific Foreign Trade Policy effective from a certain date, and the violation was detected later, justifying the notices. The court held that interference at the Show Cause stage could only be on limited grounds. As the matter was in adjudication stage and the notices were not without jurisdiction on the face of the record, the court declined to interfere at that stage.

Applicability of Foreign Trade Policy:
The respondents referred to the Foreign Trade Policy in effect during the relevant period to argue that the petitioner's EPCG license was governed by the policy effective from a specific date. They contended that the petitioner violated the policy by exceeding the export obligation fulfillment limit through group companies. The notices were issued based on this violation, with the assurance that coercive steps would only be considered post-adjudication. The court emphasized the need for the adjudication process to be completed logically and directed the petitioners to cooperate with the adjudicating authority by responding to the show cause notice within a specified timeline. The entire adjudication process was mandated to be completed within a set timeframe.

Interference by Writ Court:
The court reiterated that interference by the Writ Court at the Show Cause stage was limited. Since the notices were issued by the authorized officer and the matter was in the adjudication stage, the court found no grounds to interfere with the notices. The petitioners were instructed to file their reply to the show cause notice within a specified period, failing which adjudication would proceed without their input. The court directed that no coercive action should be taken by the respondents until one week after communicating the adjudication order. With no further issues to adjudicate, the writ petition was disposed of without costs, and the court clarified that the allegations in the petition were not deemed admitted by the respondents due to the absence of affidavits.

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