Import-Export Policy entitlement governed Special Imprest Licences where policy conditions were satisfied, despite customs exemption objections.

Under the Import-Export Policy 1988-91, entitlement to a Special Imprest Licence depended on satisfaction of the policy conditions for duty-free import of raw materials used in export production. The Bombay HC held that, once those conditions were met, the import authorities were bound to correct the first licence and issue the Special Imprest Licences. Reliance on a Customs Act exemption notification was irrelevant to the grant of the licence under the policy and could not justify refusal.

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Issues: Whether the petitioners were entitled to correction of the first licence and issuance of Special Imprest Licences under paragraph 220(iii) of the Import-Export Policy 1988-91.

Analysis: The petitioners had satisfied the conditions for a Special Imprest Licence under the Policy for duty-free import of raw materials required for manufacture of goods meant for export. The respondents sought to justify refusal on the basis of the exemption notification under the Customs Act, but that consideration was held to be irrelevant to the grant of the licence under the Import-Export Policy. Once the policy conditions were met, the import authorities were bound to issue the licence and could not deny it on the footing of the customs exemption notification.

Conclusion: The petitioners were entitled to correction of the licence and to issuance of the two Special Imprest Licences.

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