Export incentive eligibility through FTWZ supplies upheld where warehousing did not alter the export character of the transaction.

Supplies routed through a Free Trade Warehousing Unit were treated as part of an export arrangement where the petitioner had issued export documentation and received foreign exchange. The Court followed the view that warehousing logistics do not alter the essential character of the transaction, and the exclusionary clauses in the policy do not apply merely because goods pass through an FTWZ before onward shipment. On that basis, eligibility for FPS and MEIS benefits was accepted and the rejection of the claims was quashed.

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Issues: Whether the petitioner was entitled to claim benefits under the FPS and MEIS schemes for supplies made through a Free Trade Warehousing Unit, and whether the impugned rejection of such claims was liable to be quashed.

Analysis: The dispute turned on the character of the transaction and whether supplies routed through a Free Trade Warehousing Unit at the buyer's instance could be treated as exports eligible for incentive benefits. The Court followed the earlier view that the warehouse facility did not alter the essential nature of the exporter's transaction where the petitioner had effected supply against export documentation and received consideration in foreign exchange. The Court also applied the consistent interpretation adopted in earlier decisions that the exclusionary clauses in the policy would not apply merely because the goods were warehoused in an FTWZ before onward shipment.

Conclusion: The petitioner's claim for FPS and MEIS benefits was held to be maintainable and the rejection order was quashed.

Final Conclusion: The petitioner succeeded, and the respondents were directed to grant the claimed export incentive benefits within the stipulated time.

Ratio Decidendi: Where supplies are made through an FTWZ as part of an export arrangement and the transaction otherwise satisfies the policy conditions, the mere use of warehousing logistics does not defeat eligibility for export incentive benefits.

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