Policy relaxation for pre-existing export contracts: High Court quashes non-speaking rejection and directs export permission under hardship relief.

Clause 21 of the Export and Import Policy had to be applied to pre-existing export commitments where the petitioner had entered contracts and purchased sandalwood before the new policy regime. The rejection was quashed because the authority failed to consider the relevant material and did not apply its mind to the demonstrated hardship caused by the policy change. In those circumstances, the High Court could intervene under Article 226 to prevent frustration of the hardship-relief mechanism and direct grant of the necessary permission or licence to export sandalwood chips and powder, subject to the policy conditions.

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Issues: Whether the petitioner was entitled to relaxation under Clause 21 of the Export and Import Policy for the period 1-4-1992 to 31-3-1997 and to a writ of mandamus directing permission to export sandalwood chips and powder to fulfil pre-existing contracts.

Analysis: The petitioner had entered into export contracts and purchased sandalwood before the new policy came into force. The earlier Division Bench had directed consideration of the petitioner's request under Clause 21 of the new policy. The impugned rejection did not disclose application of mind or consideration of the material placed before the authority. The record showed pre-existing commitments and genuine hardship caused by the change in policy. In such circumstances, the discretion under Clause 21 had to be exercised to prevent frustration of the policy's hardship-relief mechanism, and the Court could itself issue appropriate directions under Article 226.

Conclusion: The petitioner was entitled to relief. The rejection order was quashed and mandamus issued directing grant of necessary permission or licence to export sandalwood chips and powder, subject to the stated policy conditions.

Ratio Decidendi: Where a public authority fails to consider relevant material and ignores genuine hardship in exercising policy-based discretion, the High Court under Article 226 may quash the rejection and issue mandamus to give effect to the discretion lawfully.

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