REP licence imports follow the policy in force at issuance, and qualifying studio equipment may be treated as capital goods.

Imports under a REP licence are governed by the import policy in force when the licence is issued, not the policy prevailing on the date of actual import. The licence carried flexibility to import capital goods within the prescribed value limit, subject to exclusions. TV broadcast and studio equipment used in film production was treated as capital goods because it answered the policy description of plant, machinery or equipment required for rendering services. As the goods were not shown to fall within any excluded category, their import under the REP licence was permissible and refusal of clearance was unjustified.

---

---

Issues: Whether the import of TV broadcast and studio equipment under a REP licence was governed by the import and export policy in force when the licence was issued, and whether the equipment was permissible as capital goods under the policy.

Analysis: The policy applicable to a REP licence is the policy in force when the licence is issued, not the policy in force on the date of actual import. Under the relevant import policy, capital goods meant plant, machinery, equipment or accessories required for production of goods or rendering of services. The REP licence carried in-built flexibility and could be used for import of capital goods within the prescribed value limit, subject to the stated exclusions. The equipment in question was found to be equipment used in film production and thus answered the description of capital goods. It was not shown to fall within the excluded categories, and even if it fell within a general electrical equipment entry, that did not take it outside the permitted capital goods import under the REP licence.

Conclusion: The import was governed by the earlier policy and the equipment was permissible under the REP licence. The refusal to clear the goods was unjustified and the petitioner succeeded.

Ratio Decidendi: Where a REP licence is issued during the currency of a particular import policy, the licence and imports made under it are governed by that policy, and equipment qualifying as capital goods may be imported under the licence within the policy's flexibility unless specifically excluded.

---