AI Drafter 
TaxTMI 
TaxTMI 
2016 (4) TMI 790
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....rt Export Code (IEC) issued by the Director General of Foreign Trade bearing IEC No. 0412024047 for the purpose of import of spices, poppy seeds and other items. According to the petitioner, during the course of their business, they have intended to import poppy seeds from China, which according to them is permitted in terms of the Foreign Trade Policy in force from time to time. The condition prescribed in this regard is that the import contract for specified quantities has to be submitted to the fourth respondent, who would register the contract pursuant to which imports will be permitted in respect of the quantity mentioned in the contract. (ii) The petitioner would submit that hitherto, the issue relating to import of poppy seeds was agitated before the Allahabad High Court in PIL No. 22067 of 2013 filed by Ayurveda Sevashram Kalyan Samiti, Allahabad. By an order dated 29.11.2013, the Allahabad High Court has made certain observations in respect of import of poppy seeds into India. Pursuant ot the above order, the Department of Revenue, Ministry of Finance, Government of India vide communication dated Nil.February 2014 addressed to the fourth respondent informed that the com....
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....ram Kalyan Samiti, Allahabad in which an order dated 29.11.2013 was passed observing that the official respondents therein must ensure that poppy seeds illegally grown should not be allowed to be imported into India. A further direction was issued to ensure that the official respondents come out with a policy in respect of import of poppy seeds ensuring that only legally grown poppy seeds are imported into India. While so, the fourth respondent, purportedly in exercise of the powers conferred with the Ministry of Commerce and Director General of Trade, has come out with the impugned public notice relating to import of Poppy Seeds from China. It is further stated that Import and Export of goods and commodities are governed by the provisions of Foreign Trade (Development and Regulation) Act, 1992, particularly Sections 3, 5 and 6. As per the said Act, the power to formulate an export and import policy is exclusively vested with the Central Government. Even the power to amend the policy is vested with the Central Government. Such power is a legislative power in the nature of subordinate legislation and such powers cannot be delegated to any authority including the Director General of ....
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....espondent as they fall within the realm of Ministry of Commerce and Director General of Foreign Trade. Further, poppy seeds is freely importable subject to registration of the import contract with the office of the fourth respondent, however, by imposing the conditions for registration of import contracts more particularly from China is clearly out of the jurisdiction of the fourth respondent. As regards public notices relating to import of poppy seeds from Turkey, they are preceded by communications/notices clearly specifying the total availability of harvested crop in Turkey, quantity used for local consumption, quantity for export to countries other than India and specific quantity for export to India. However, such a clear specification is absent in the impugned public notice. Further, in the impugned public notice, it was indicated that if the quantity of poppy seeds is not available for allocation to all applicants, the quantity available for import to India from China would be allocated on drawal of lot basis and in such event, those who are not successful in the drawal of lot would be put on wait list and they will be considered for allocation of import of poppy seeds from ....
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....ent in exercise of power under Section 5 of the Foreign Trade (Development and Regulation) Act has statutory force and the power to amend the policy is within the exclusive domain of the Central Government. It was further observed that such power cannot be usurped even by the Director General of Foreign Trade in the guise of laying down regulatory measures. If the procedural norms are in conflict with the policy, then the policy will prevail and the procedural norms to the extent they are in conflict with the policy, will be declared as bad in law. The learned senior counsel for the petitoiner also brought to the notice of this Court that the order of the Division Bench of the Bombay High Court mentioned above has been upheld by the Honourable Supreme Court in the decision reported in (2003) 158 ELT A275 (SC) in (Union of India vs. Narendra Udesh). 5. The learned Senior Counsel for the petitioner also placed reliance on the decision of the Honourable Supreme Court in the case of (Atul Commodities Pvt Ltd vs. Commissioner of Customs, Cochin) 2009 (235) ELT 385 (SC) to contend that the power to amend the foreign trade policy is vested in the Central Government whereas the power to....
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....der a part or full registered quantity, then the quantity so surrendered will be re-allocated to unsuccessful applicants so that the shortage of poppy seeds can be avoided. The public notice impugned in the writ petition is aimed to ensure that the importer does not frivolously get contracts registered in their favour to reduce the chance of registration by other applicants. In other words, the conditions incorporated in the public notice is to dissuade frivolous importers from registering the contract and in the larger interest of the importers. 8. According to the learned Additional Solicitor General appearing for the respondents 1 to 4, the period stipulated in the public notice for surrender of part or full registration is 30 days and the validity of registration for actual import is four months from the date of registration. By this the importer, who has registered a quantity but did not import even after lapse of 4 months without surrendering within the prescribed period will be debarred. Thus, the quantity surrendered by one importer can be re-allocated to another importer who is willing to import and thereby the shortage of poppy seeds can be avoided. This, according to ....
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....petent authority for registration of sales contracts for import of poppy seeds from China and Czech Republic. By placing reliance on the above letter dated 22.01.2016, the learned Additional Solicitor General for the respondents 1 to 4 would contend that the fourth respondent has power and authority to impose the conditions in the public notice, which is impugned in this writ petition. 12. The learned Additional Solicitor General appearing for the respondents 1 to 4 in order to substantiate his contentions, relied on Article 39 (2) of the Constitution of India and contend that in order to effectively implement the policies of the Government, the fourth respondent is empowered to exercise certaom powers to have control over the material resources of the Country and to ensure that they are equally distributed to subserve the common good. Therefore also, the learned Additional Solicitor General would contend that it is not as though the fourth respondent has to confine himself with the powers vested under EXIM Policy relating to import of poppy seeds (HS Code : 1207 91 00) and the source and power of the fourth respondent is also traceable under Article 39 (2) of the Constitution o....
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.... that the petitoiner has no locus standi to file this writ petition. The petitioner is not an aggrieved person because at no point of time, he had imported poppy seeds. Even in response to the present public notice, he has not made any application to register a sales contract. Even during the past, the petitioner has not registered a single sales contract with the fourth respondent for import of poppy seeds. While so, there is no cause of action for the petitioner to approach this Court with this writ petition. Unless it is established by the petitioner that the conditions imposed in the public notice has in any way infringed his fundamental right to carry on business, the petitioner is estopped from maintaining this writ petition. As regards the power or authority of the fourth respondent to impose the conditions in the public notice, which are questioned in this writ petition, the learned Senior counsel for the respondents 5 to 7 would contend that the role of the fourth respondent is to ensure effective implementation of the policies of the Central Government. By placing reliance on Section 5 of the Narcotic Drugs and Psychotrophic Substances Act, 1985, in short NDPS Act, the le....
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....spondents 5 to 7 prayed this Court to dismiss the writ petition. 16. I heard the learned senior counsel for the petitioner, learned Additional Solicitor General appearing for the respondents 1 to 4 as well as the learned senior counsel for the respondents 5 to 7. I had gone through the entire materials placed on record. 17. On consideration of the rival submissions of the counsel on either side, the primary question that arise for consideration in this writ petition is whether the fourth respondent is empowered to issue the public notice dated 27.01.2016 by imposing certain conditions over and above the three conditions stipulated in Chapter 12 of Exim Code 1207 91 00 relating import of poppy seeds. For examining the source of power of the fourth respondent in detail, it is necessary to look into the three conditions which reads as follows:-:- "(i) Import permitted only from Australia, Austria, France, China, Hungary, The Netherlands, Poland, Slovenia, Spain, Turkey and Czech Republic (ii) The importer shall produce an appropriate certificate from the competent authority of the exporting country that opium poppy have been grown licitly/legally in that country as per req....
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....escribed in the order." 19. On a reading of Section 3, 5 and 6 mentioned above, it is evident that even for regulating or effectively implementing the policy of the Central Government, the fourth respondent has no power to impose any other conditions other than the one prescribed in EXIM Code 1207 91 00 relating import of poppy seeds. There is no delgation of power in favour of the fourth respondent to impose the conditions in the impugned public notice. There is no order passed by the Central Government by publishing it in the official gazzette specifically authorising the fourth respondent to exercise such power as are necessary for prohibiting, restricting or otherwise regulating the import of poppy seeds in compliance with Section 5 of the Foreign Trade (Development and Regulation) Act, 1952. Therefore, I hold that the fourth respondent has to confine the exercise of his power only in relation to the duties and responsibilities spelt out in Chapter 12 of Exim Code 1207 91 00 relating to import of poppy seeds and they are (i) whether the import of the poppy seeds is from one of the designated countries (ii) whether the importer has a certificate from the competent authority o....
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....Solicitor General placed reliance on a letter dated 22.01.2016 issued by the Government of India, Department of Revenue enclosing a copy of the revised guidelines approved by the competent authority for registration of sales contracts for import of poppy seeds from China and Czech Republic. By placing reliance on the above letter dated 22.01.2016, the learned Additional Solicitor General traces the power of the fourth respondent to impose the conditions in the public notice, which is impugned in this writ petition, as a measure of regulating and controlling the import of poppy seeds. I am unable to accept this contention. It is well settled that circulars, administrative instructions or letters of authorisation cannot over ride the statute. The Export-Import Policy announced by the Central Government in exercise of power under Section 5 of the Foreign Trade (Development and Regulation) Act has statutory force and the power to amend the policy is within the exclusive domain of the Central Government. While so, without making any amendment to the Export-Import Policy framed by the Central Government, even the Central Government cannot delegate power to the fourth respondent to exerci....
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....n of India) 2003 (1) Mh.LJ 1 rendered by the Division Bench of the Bombay High Court (ii) (Atul Commodities Pvt Ltd vs. Commissioner of Customs, Cochin) 2009 (235) ELT 385 (SC) it was categorically held that the power to amend the foreign trade policy is vested only with the Central Government. The ratio laid down by the Division Bench of the Bombay High Court and the Honourable Supreme Court in the above referred to decisions squarely applicable to the facts and circumstances of this case. 24. Similarly, in the decision of the Honourable Supreme Court in (Director General of Foreign Trade and another vs. Kanak Exports and another) 2015 SCC 123 relied on by the learned Senior Counsel for the petitioner, in an identical case, it was clearly held that the public notice issued by the fourth respondent is without jurisdiction and as per Section 5 of the Foreign Trade (Development and Regulation) Act, 1992, the Central Government alone can formulate and anounce the Exim Policy and resort to amend it from time to time. 25. As regards the submission of the learned Senior counsel for the respondents 5 to 7 relating to the locus standi of the petitioner to file this writ petition, it ....