Division Bench overturns single judge's order allowing 18,900 MTs non-basmati rice export despite prohibition notification

The AP HC set aside a single judge's order permitting export of 18,900 MTs of non-basmati rice despite notification No. 20/2023 prohibiting such exports. The petitioner had argued that denial would cause financial losses from foreign buyers. The appellate court found the single judge improperly allowed entire contracted quantity export without deciding on the notification's validity, especially after petitioner withdrew the challenge to the notification after obtaining interim relief. The matter was remanded to the single judge for fresh consideration alongside similar batch petitions.

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Issues Involved:
The judgment involves the challenge against a notification banning the export of non-basmati white rice, the retrospective effect of the restrictions, the doctrine of legitimate expectation, and the permissibility of exporting rice in violation of the notification.

Challenge Against Notification:
The petitioner, a company engaged in rice export, entered into contracts with foreign buyers for supplying non-basmati Indian white rice. A notification was issued banning the export of such rice, leading to the petitioner seeking permission to export the rice covered under the contracts. The single Judge observed that the restrictions operated retrospectively, impeding traders from fulfilling their obligations, and modified the interim order to allow the export of 18,900 MTs of rice in line with the concluded contracts.

Doctrine of Legitimate Expectation:
The learned single Judge found that the restrictions in the notification violated the doctrine of legitimate expectation as they prevented traders from honoring their obligations. The court held that such restrictions were impermissible, leading to the modification of the interim order to permit the export of the rice covered under the contracts entered into before the issuance of the impugned notification.

Permissibility of Exporting Contrary to Notification:
The appellant argued that the single Judge erred in permitting the export of rice in violation of the impugned notification without quashing it. It was contended that allowing the export of rice not falling under the conditions of the notification went against the government's policy of safeguarding food security and controlling prices. The Court noted that the single Judge's decision to permit the export of the entire quantity of rice covered by the contracts contradicted the purpose of challenging the notification, which was not addressed due to the petitioner withdrawing the challenge after obtaining interim relief.

Decision and Remand:
The High Court set aside the impugned judgment and remanded the matter for fresh consideration along with other related petitions. The Court emphasized the need to address the validity of the notification and upheld or set it aside accordingly. The case was disposed of with no order as to costs, and pending applications were closed.

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