Advance licence rights cannot be defeated retrospectively by later norms; surrender direction was invalid and revalidation required.

An advance licence is governed by the Export and Import Policy and procedure in force on the date of issue, so later norms cannot retrospectively impair rights already crystallised under an earlier licence. Where a quantity-based advance licence was granted after the competent authority examined the application, subsequent publication of norms could not justify cancellation, modification, or a direction to surrender the original licence, especially after the export obligation had been fulfilled. The Bombay HC held the surrender direction arbitrary and illegal and required the respondents to endorse transferability and revalidate the licence.

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Issues: Whether the norms issued on 20 January 1995 could retrospectively alter or cancel a quantity-based advance licence granted on 14 September 1993, and whether the respondents were justified in directing surrender of the original licence instead of endorsing transferability and revalidating it.

Analysis: The licence was granted under the Export and Import Policy then in force, and paragraph 48 made an advance licence subject to the policy and procedure prevailing on the date of issue. Paragraph 51 contemplated that, where standard input-output norms had not been published for a quantity-based advance licence, the quantitative norms would be fixed by the competent authority. Once the competent authority had granted the licence after examining the petitioners' application, the later publication of norms could not operate to the prejudice of rights already crystallised under the earlier licence. The later norms were held to be prospective only and could not authorise cancellation or modification of an existing licence after the export obligation had been fulfilled. The order directing surrender of the original licence was therefore arbitrary and illegal.

Conclusion: The later norms could not be applied retrospectively to the petitioners' earlier advance licence, and the direction to surrender the licence was invalid; the respondents were required to endorse transferability and revalidate the licence.

Ratio Decidendi: An advance licence is governed by the policy and norms in force on the date of its issue, and later norms cannot retrospectively defeat or modify rights already accrued under that licence.

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