Import quota allocation must follow cut-off capacity; post-cut-off expansion cannot justify a larger share.

An import allocation scheme tied to a judicially fixed ceiling must be administered only on the basis of production capacities existing on the specified cut-off date. Post-cut-off enhancement of a unit's capacity, even if later recognised by regulatory consent to operate, cannot be used to revise the inter se distribution or enlarge that unit's share of raw petroleum coke. DGFT public notices had to remain consistent with the Supreme Court's ceiling and could not alter the underlying capacity base administratively. The allocation made by relying on enhanced post-cut-off capacity was therefore invalid, and the impugned allocation was set aside with directions to redraw the distribution in accordance with the court's findings.

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Issues: Whether the Directorate General of Foreign Trade could rework the allocation of imported raw petroleum coke on the basis of an enhanced production capacity of a calciner created after the Supreme Court's order fixing the total import ceiling, and whether the subsequent allocation in favour of that unit was valid.

Analysis: The import ceiling of 1.4 million metric tonnes was fixed on the basis of the production capacities existing as on 09.10.2018 and the capacities disclosed to the regulatory authorities and the EPCA. The later consent to operate recognising enhanced capacity was granted after that date and could not be treated as part of the basis on which the ceiling was fixed. The public notices issued by the DGFT had to operate consistently with that ceiling and could not be used to alter the underlying capacity base or to enlarge the share of a unit by relying on post-cut-off expansion. The Court held that any change in the inter se allocation based on later enhancement of capacity would upset the foundation of the Supreme Court's restriction and could not be done administratively by the DGFT.

Conclusion: The allocation made on the basis of enhanced post-cut-off capacity was invalid.

Final Conclusion: The petitions and appeals succeeded to the extent that the impugned allocation based on enhanced capacity was set aside and the authorities were directed to redraw the allocation in accordance with the Court's findings.

Ratio Decidendi: Where a quota or allocation has been fixed on the basis of capacity existing on a specified cut-off date pursuant to a binding judicial ceiling, the administering authority cannot revise the inter se distribution by relying on capacity enhancements certified after that date.

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