Import licence revalidation cannot curtail original validity where policy gives automatic month-end extension and shipment rights continue

A revalidation endorsement on an import licence did not cut short the original licence period where the governing import policy treated the licence as valid until the end of the month in which it expired. The original licence continued to govern shipment rights during that automatically extended period, and validity depended on the date of actual shipment or despatch rather than the date of arrival in India. Conditions attached to the revalidated period could not retrospectively extinguish rights already accrued under the original licence. Imports made within the original licence's extended currency remained valid.

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Issues: Whether the endorsement made while revalidating an import licence extinguished the original validity of the licence for shipment of goods under the prior import policy up to the end of the month in which the original licence expired.

Analysis: The original licence, issued under the earlier import policy, remained governed by the rule that validity is linked to the date of actual shipment or despatch, not the date of arrival in India. Where the expiry date falls before the last day of the month, the licence is automatically valid until the end of that month. The revalidation endorsement operated only for the extended/revalidated period and could not retrospectively curtail the rights already available under the original licence during its legally extended currency. The original licence and the revalidated licence were treated as distinct for the purpose of the rights and obligations flowing from each period.

Conclusion: The endorsement on revalidation did not extinguish the original validity of the licence, and the import effected within the automatically extended original period remained valid. The finding was in favour of the assessee and against the revenue.

Ratio Decidendi: A revalidation endorsement on an import licence does not override the statutory or policy-based automatic extension of the original licence period, and rights accrued under the original valid period cannot be nullified by conditions attached only to the revalidated period.

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