TaxTMI 
TaxTMI 
2021 (5) TMI 595
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.... the present petition are as follows: 2.1 The Central Government issued various promotional/incentive schemes to accelerate growth of export goods for the country to earn the foreign exchange. Chapter IV and V of the Foreign Trade Policy ('the FTP' for short) contains the provisions relating to Duty Exemption Scheme. These are the schemes for extending incentive to exporters. 2.2 One such scheme is import of capital goods under Export Promotion Capital Goods ('the EPCG Scheme' for short). Under the said scheme, the importers are allowed to import capital goods at Zero rate of duty or at the rate of 3% of the duty. This is to ensure that at affordable price the exporters are allowed to import the capital goods and good quality of final product can be made out from the same. The EPCG Scheme allowed import of capital goods for pre-production, production and post-production, subject to the condition that the exporters fulfill Export Obligation equivalent to eight times of duty on capital goods imported under the EPCG Scheme within a period of eight years or the period as extended by DGFT thereafter, reckoned from the date of issuance of the authorisati....
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.... the pendency of such application of EOP, further export of goods totally valued at US$ 1,33,075/- (worth Rs. 77,54,572/-) was made. Although, the said export was not considered towards fulfillment of Export Obligation; as the application of the petitioner was pending and the Export Obligation Period ('the EOP' for short) had expired when the said goods were exported. 2.8 Respondent No.2 by an amendment sheet No.2 issued from File No.08/36/160/00206/AMI9 dated 27.08.2018 had extended the time for fulfillment of Export Obligation upto 09.09.2018 for the first block period; however, no Export Obligation could be discharged by the petitioner, as the letter granting extension of the time for Export Obligation was received only a month before the extended period expired. The petitioner also tried to fulfill the Export Obligation through the third party exports as defined under para 9.6 of the FTP and permitted under Para 5 of the FTP. Although, what was required was that the goods were actually to be manufactured on the imported capital goods w.e.f. April, 2015, the petitioner did not claim the benefit of such exports. 2.9 Because of this, the petitioner applie....
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....2 on 10.09.2018 after duly examining all facts and considering that the obligations have also been fulfilled by the petitioner and also considering the provisions of FTP governing the issue, fees of Rs. 8000/of such extension has also been paid. The respondent No.3 had no business to unilaterally suspend the said extension without granting any opportunity of hearing to the petitioner. 2.15 According to the petitioner, it is a settled position of law that the DGFT is the final authority in the matters concerning FTP as provided in para 2.57 of the FTP and licences, such as the EPCG licence issued to the petitioner. Despite the said position, respondent No.4 intervened in the process and prevented the petitioner from enjoying the benefit of the extension of the EOP granted to the petitioner as is permissible under the law. It is lamented by the petitioner that the DGFT permission once granted cannot be withdrawn. Resultantly, the present petition with the following prayers: "12. (a) this Hon'ble Court be pleased to issue writ of Mandamus or any other appropriate writ, order or direction under Article 226 of the Constitution of India, ordering and direct....
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.... to be issued on 10.07.2019. 4. Affidavit-in-reply is filed by the respondent-Commissioner of Customs, NSII, Customs and Excise Department, denying every allegations and averments. According to the respondent, the Notification No.97/2004-CUS dated 17.09.2004 is not applicable in the present case. The Notification 64/2008-CUS dated 09.05.2008 is applicable in the present case and the same is also mentioned in the EPCG authorisation No.0830002618 dated 09.09.2008 issued to the petitioner. 4.1. It is further the say of the respondent that out of the total shipping bills, the petitioner had only 14 shipping bills for export of goods totaling worth US$ 2,54,266.14 equivalent to Rs. 1,57,08,787.73 mentioned towards fulfillment of their obligation towards EPCG authorisation No.0830002618. It is further contended by the respondent that the petitioner in connivance with M/s.Quarterfold Printabilites indulged in fraudulent activity of getting their names and EPCG licence number mentioned as supporting manufacturer in the 9 shipping bills filed by M/s.Quarterfold Printabilites without manufacturing and supplying any goods to M/s.Quarterfold Printabilites with an intent to submit t....
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....iod. There had been suspension of the amendment on 22.01.2019. According to him, he had no option but to export and therefore, against the invoice of 15.04.2019, he exported 10% of the quantity, and he did not mention the authorisation number in the export document, as it was not viable for the petitioner to export the ordered quantity as his authorisation was suspended to cancel the order, and did not supply further material towards purchase order on 12.01.2019. 8.2 He has lamented further that as it was not financially viable to supply the material since the export was not to be counted towards fulfillment of Export Obligations against the authorisation. According to the learned advocate, the petitioner has not shown even a single rupee of sales to M/s.Quarterfold Printabilites in the books of accounts. Against the Export Obligation of US$ 2,54,244.14 he has been able to fulfill such obligation of US$ worth of Rs. 4,01,481. He completed 43% of his obligation and is ready to so do it, so therefore, if the real objective of such export, if is looked at, he should be provided an opportunity. He emphasised that once the extension is granted, the same cannot be revoked withou....
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.... to fulfill complete Export Obligation and therefore, sought further extension of period for fulfilling the obligation of export. Such a request was made to respondent No.2 and during the pendecy of this request, he further exported the goods worth US$ 1,33,075/- ( worth Rs. 77,54,572/-). It is to be noted that this could not be considered towards the fulfillment of his Export Obligation as his EOP had already expired by then. 14. The respondent No.2 on 27.08.2018 extended the time for Export Obligation to 09.09.2018 for the first block period. As such letter was received only a month before the extended period expired, nothing could be done by the petitioner. He attempted to fulfill this through the third party exports as defined under para 5 and 9.6 of the FTP. He again applied for second extension, which was granted on 10.09.2018 and the time was granted upto 09.09.2020. 15. What is required of the petitioner was that the imported capital goods are to be utilized for the purpose of manufacturing and since the petitioner had exported goods at US$ 2,54,266.14 (FOB) against the Export Obligation of US$ 9,29,268.71 (FOB) till 09.09.2018 under EPCG licence No.0830002618 dated 0....
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....ards fulfillment of their Export Obligation and to obtain EODC against the said EPCG licence No.0830002618 dated 09.09.2008. 17. As could be noticed from the counter affidavit of the respondent Nos.1 to 3 the EOP extension in respect of EPCG Authorisation, which was granted to the petitioner by the respondent No.2 upto 09.09.2020 has been cancelled on account of instructions received from the DRI, Ahmedabad that the petitioner was indulging in misuse of the EPCG Scheme by fraudulently attempting to show bogus export towards fulfillment of their Export Obligation against EPCG Authorisation. The DRI has also alleged that in respect of the shipping bills of M/s.Quarterfold Printabilites, the petitioner had shown the said firm as its supporting manufacturer and had used the petitioner's name and EPCG Authorisation number in the shipping bills of the firm to show them as its exports. It is thus prima facie clear that the required condition of EPCG Authorisation that the goods exported needed to be manufactured out of the capital goods imported by the petitioner has not been complied with as per the informations given by the DRI and therefore, the respondent No.2 had cancelled the....
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.... there had been a suspension of the amendment sheet No.3 dated 27.11.2018. It is to be noted that this communication clearly speaks of the suspension if not the cancellation or rejection of grant of the extension of the Export Obligation. This had come in wake of the inputs received from the DRI. The show cause notice pursuant to the said search operation and subsequent to the suspension of this is already given on 05.03.2019. Any indulgence on the part of the Court at this stage, would amount to entertaining the matter and indulging into the merit at the stage of show cause notice, which is impermissible. 20. Apt would be to refer to the decision of the Apex Court rendered in case of Union of India vs. Indalco Industries, reported in 2003 (3) SCR 377, its relevant findings and observations are as follow : "There can be no doubt that in matter of taxation, it is inappropriate for the High Court to interfere in exercise of jurisdiction under Article 226 of the Constitution either at the stage of show cause notice or at the stage of assessment where alternative remedy by way of filing a reply or appeal, as the case may be, is available but these are the limitations impose....
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....ustrial Tribunal to stay its hands and to embark upon the preliminary enquiry itself. The jurisdiction of the High Court to adopt this course cannot be, and is indeed not disputed. But would it be proper for the High Court to adopt such a course unless the ends of Justice seem to make is necessary to do so? Normally, the questions of fact, though they may be jurisdictional facts the decision of which depends upon the appreciation of evidence, should be left to be tied by the Special Tribunals constituted for that purpose. If and after the Special Tribunals try the preliminary issue in respect of such jurisdictional facts, it would be, open to the aggrieved party to take that matter before the High Court by a writ petition and ask for an appropriate writ. Speaking generally, it would not be proper or appropriate that the initial jurisdiction of the Special Tribunal to deal with these jurisdictional facts should be circumvented and the decision of such a preliminary issue brought before a High Court in its writ jurisdiction. We wish to point out that in making these observations, we do not propose to lay down any fixed or inflexible Rule; whether or not even the preliminary ....