TaxTMI 
TaxTMI 
2023 (7) TMI 116
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....ich has interfered with and set aside the minutes of the meeting as well as the decision of the Central Government allocating pet-coke. 3. The necessary facts are that the Director General of Foreign Trade (DGFT) determined the criteria for the allocation of imported raw pet-coke (RPC) and allocated imported RPC among various entities. On 18.07.2018, the Central Ministry of Environment, Forest and Climate Change ("MoEF"), officers of the Environment Pollution (Prevention and Control) Authority for NCR and the Ministry of Petroleum and Natural Gas ("MPNG") decided in principle that import of pet-coke be ought to be restricted only to industries using it as a feedstock or as part of their manufacturing process and not as fuel. This court - seized of the public interest litigation ("PIL") in M.C. Mehta v. Union of India [W.P. No 13029/1985] (hereafter "M.C. Mehta Case") directed implementation of the minutes of the meeting of 18.07.2018 by its order dated 26.07.2018. The MoEF issued an office memorandum further to this court's order dated 10.09.2018, prescribing guidelines for regulation and monitoring of the import of RPC. Importers were obliged to obtain consent and registration ....
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.... The industry has also informed EPCA that it meets S02, NOx and particulate emission standards, as stipulated by CPCB. A.1.2 EPCA Recommendation on Calciner Industry. The Calciner industry should be allowed to import pet coke as its industry uses it for feedstock and not for fuel. This import is required as anode grade petcoke is not available in sufficient quantities in the country." 4. On 09.10.2018, based on the EPCA report, this court made an order directing that RPC import cannot exceed 1.4 MMTPA and that it could be used as feedstock for producing CPC. The figure of 1.4 MMTPA was based on the production capacity of calciners given by each one of them. This became the basis of an order by this court dated 09.10.2018. As a consequence, on the same day, a notification Notification No 42/2015-20 was issued by DGFT amending the foreign trade policy in relation to the import of RPC. The amendment allowed the import of RPC for cement, calcium carbide, gasification, limekiln and graphite industries for use as feedstock or in the manufacturing process on an actual user basis. The regulation and monitoring of these imports were to be supervised on the basis of....
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....yers made on the basis of expansion etc. are totally misconceived and cannot be entertained. No further orders are required to be passed on these I.As. i.e. I.A. Nos. 168847/2018, 1451/2019 & 1847/2019 [filed on behalf of Rain CII Carbon (Vizag) Ltd.], I.A. No. 164303 (filed on behalf of Saket Agarwal), I.A. No. 12291/2019 (filed on behalf of Sanvira Industries Ltd.) and I.A. No. 13210/2019 (filed on behalf of Goa Carbon Ltd.). The same are hereby dismissed." 7. On 22.03.2019, a second public notice, in regard to allocation was issued. Sanvira had requested for enhancement of allocation to it, based on its claim of enhanced capacity to the extent of 1,30,000 MTPA. This application for enhancement was rejected by DGFT, which also rejected a similar application for increased capacity by the contesting respondent, Rain CII. The relevant part of the rejection order, dated 22.04.2019 is extracted below: "7. The committee also observed that M/s Rain (CII) has drawn attention to DGFT's Office Memorandum No. 01 /93/180/03/AM-1 O/PC-2(A)/P-12485 dated 5th December, 2018. The Committee decided that in view of the order of the Hon'ble Supreme Court dated 28.1.2019 (as deta....
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.... outer limit for import of RPC had already been fixed and any prayer seeking enhancement of that limit cannot be entertained and that the said order made no observation, as to whether the enhanced production capacity of the existing calciners were to considered or not is baseless. The Committee was of the view that the prayer before the Hon'ble Supreme Court (as in Para 1) was "to enhance/increase the import limit of 1.4 Million MT of RPC by an additional amount of 488,000 MT per annum for manufacturing CPC at the Applicant's SEZ Unit and accordingly direct the DGFT and other authorities, including the Ministry of Commerce, to allocate this additional RPC to the Applicant. To which the Hon'ble Supreme Court in its order dated 28.01.2019 directed that "the order passed by this Court is clear. This Court has set the outer limit for import of Raw Pet Coke cannot exceed 1.4 MT per annum in total. In view of the aforesaid, prayers made on the basis of expansion etc. are totally misconceived and cannot be entertained. No further orders are required to be passed on these I.As. The same are hereby dismissed." M/s Rain Cll (Vizag) Ltd. had prayed before the Hon'ble Supreme C....
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.... No further clarification is required. This application is disposed of." 10. In view of the above, the Committee decided to reject the submission made by the applicant to allocate additional quantity of RPC for the new capacity added by the firm after 09.10.2018." 11. This decision was again challenged by Sanvira, by filing WP No. 1858/2020 before the Delhi High Court. On 17.04.2020, DGFT had issued a public notice, which indicated the procedure for allocation of quota for the import of PET coke (RPC and CPC); it inter alia stated that: ii. "The annual quantity limitation in import will be operated on fiscal year basis. * Accordingly, the total quantity permitted for import per annum by the Hon'ble Supreme Court and available for import is (i) Calcined Pet Coke for use as Calcined Pet coke in Aluminium Industry is 0.5 Million MT and (ii) Raw Pet Coke for CPC manufacturing industry is 1.4 Million MT. This is available for all industrial units in these two sectors including the petitioners. iii. All eligible entities desiring to avail quota as mentioned above, may apply for import license as per procedure mentioned in Trade Notice N....
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.... to finalize the quantum of allocation of CPC and RPC pursuant to the public notice dated 17.04.2020. Rain CII's request for enhanced allocation based on its claim of increased capacity was also considered. The minutes of meeting recorded on that day, i.e. 03.06.2020 are as follows: "4. M/s Rain CII Carbon (Vizag) Ltd, SEZ Unit has submitted an application for quantity of 4,88,000 MT of RPC in addition to an application for the DTA unit. It was noted that the CTO from Andhra Pradesh Pollution Control Board had been obtained vide their Consent Letter dated 6.3.2020. The Committee noted that since the CTO does not specify the installed capacity as on 9th October 2018, the Committee accordingly decided to not consider the request for allocation of quota. xxx 6. The Committee examined the SPCB certificates of all the applicants for RPC imports. On examination, Committee observed that the SPCBs have adopted varying conversion rates for calculating the requirement of RPC for producing CPC. In their CTO certificates, the Committee also noted that consumption requirement is not indicated in SPCB certificates of all the firms. To bring uniformity, the Committee decided to ....
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....n challenge. On the basis of all these reasoning, Rain CII's petition was rejected. 14. Rain CII preferred appeals and writ petitions to the Division Bench of the Delhi High Court LPA 25/2021; LPA 70/2021; LPA 71/2021, W.P. (C) 5749/2021, and W.P. (C) 6258/2022 Rain CII Carbon (VIZAG) Ltd. vs. Union of India and Ors. , challenging the judgment of the Single Judge and also impugning the public notice dated 17.04.2020. The Division Bench, in its impugned judgment, held that on 09.10.2018, when this court passed the order, every calciner had given its capacity. The total capacity of all the calciners put together came to 11,72,750 MTPAs and the production and the total import that was necessary for the calciners to continue producing pet coke from raw pet coke was assessed as 1.4 MMTPA. This was based entirely on the total production capacity. On 09.10.2018, Sanvira's recognition to increase its capacity from 2,00,000 Metric Tonnes to 3,30,000 MT had not been placed, rather the consent to operate dated 22.04.2017 restricted Sanvira to produce only 200000 MT of pet coke. The impugned judgment held that Sanvira's increased capacity (of 1,30,000 MT) was granted only on the basis of an....
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....ders dated 28.01.2019 and 08.07.2019 of this court merely clarified that the overall import of RPC has to be confined to 1.4 MMTPA. This court did not consider Sanvira's claim that as on 09.10.2018 its production capacity was in fact, 3.30 lakh MT. 17. In reply Rain CII argued that the Committee had from the very beginning rejected requests for enhancement of allocation on the ground that any capacity increase after 09.10.2018 would not be taken into consideration. This consistent stand was reflected in the EPCA's minutes of the meeting prior to 03.06.2020. In fact, even the GOI defended the rejection of Sanvira's request, barely five weeks before the impugned allocation by contending before the High Court that Sanvira was abusing the judicial process by repeatedly requesting the same relief. Having regard to these facts, there is no change of circumstances - much less new development or new facts which could have persuaded the committee as held by the Single Judge. There was in fact no change in the criteria. On behalf of Rain CII, it was highlighted that all facts pertaining to the alleged increase in capacity prior to 09.10.2018 i.e. the issuance of the CTO, the fact that ins....
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..... The EPCA report clearly states that the total capacity was 1.17 million tonnes; in arriving at this figure the EPCA took note of the capacity based upon the Consent to Operate (CTO) issued by the concerned Pollution Control Board. In the case of Rain CII, the capacity recorded was 500,000 MTPA, and in the case of Sanvira- 2,00,000 MTPA. The guidelines for regulation and monitoring of imported pet coke had been issued on 10th September 2018 by an office memorandum - through the MOEF, GOI. The relevant guidelines are extracted below: "1. Guidelines for Regulation and Monitoring of Imported Petcoke in India As per notification of Director General of Foreign Trade (DGFT) dated 17.08.2018, imported of Petcoke for use as fuel is prohibited. However, import of Petcoke is allowed for the following industries namely, cement, lime kiln, calcium carbide and gasification for use a feedstock or in the manufacturing process only on actual user basis as per the conditions stipulated below: (1) Petcoke importing industries namely, cement, like kiln, calcium carbide and gasification shall obtain the consent of and registration with the concerned State Pollution Control ....
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....th respect to its increased production capacity to 3,30,000 TPA. In its application I.A. No 73242/2019, Sanvira contended as follows: "(a) In September 2017 the applicant initiated capacity addition from 200,000 to 330,000 MTPA comprising of approximately furnaces having a capacity of 40,000 MTPA each and expansion of power point_ capacity from 8 MW to 16 MW. (b) The total cost of capacity addition undertaken by the Applicant is Rs. 75 Crores, of which Rs. 50 Crores has been raised through a loan from EXIM Bank. Copy of loan sanction letter dated 03.01.2018 issuing by EXIM Bank is annexed hereto and marked as Annexure A-4 (Pages 30-56). (c) By March 2018, the Applicant had installed the first furnace of 40,000TPA and had a total installed capacity of 240,000 MTPA. Minutes of the consortium of Bank meeting dated 05.05.2018 and 13.08.2018 which note that 240,000 MTPA capacity was operational since 01.08.2018 are annexed hereto and Marked as Annexure A-S (Pages 57 -6) and Annexure A-6 (Pages 62-67). Report dated 17.04.2018 of the Lender Engineer appointed by the Bank Consortium which notes that Applicant had erected and commissioned additional CP....
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....e procedures after the Order of this Court dated 09.10.2018 would not be taken into consideration while allocating the RPC. This is clear from the narration from the Order made on 13.02.2020 which records as follows: "(iii) Procedure for allocation of quota for import of Raw Pet Coke for CPC manufacturing industry was notified by Public Notice No. 81/2015-20 dated 23.03.2019. As per the Public Notice the EFC in DGFT has to evaluate and allot quota among applicants. (iv) Accordingly, a meeting of the EFC was held on 05.04.2019. In order to bring uniformity in allocation of RPC it was decided to allocate as per the production capacity on a proportionate basis. One of the criteria adopted by the committee was that the additional capacity added by the applicants after the Supreme Court's order dated 09.10.2018 will not be taken into consideration while allocating RPC. In the meeting held on 05.04.2019 for considering allocation of 1.4 million MT of Raw Pet Coke, the committee observed that M/s Rain CII Carbon (Vizag) Ltd. and M/s Sanvira Industries Ltd. had submitted additional requirement of 4,88,000 MT and 1,30,000 MT of RPC respectively. The committee further o....
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....of the Hon'ble Supreme Court i.e., 09.10.2018. the Committee uploaded the draft Minutes of the EPC meeting (held on 05 .04.2019) on DGFT website to enable the applicants to represent their grievances by 15.04.2019 and based on the representation, if any. Committee will take a decision and allocate the final quantity." The same documents i.e., the minutes also recorded that Sanvira's additional capacity was created after this court's order dated 09.10.2018. 25. From all these facts, it is evident that Sanvira kept on contending that its capacity was 3,30,000 MTPA. The minutes of the meeting dated 13.02.2020, also allude to the previous attempts by Sanvira, to have its capacity increased, as on 09.10.2018 in an effort to secure more allocation. All such contentions were rejected. In this background, the view expressed by the single judge, that the principle for allocation was changed somewhat in the public notice, dated 17.04.2020, is not tenable. The relevant part of that notice reads as follows: "All eligible entities desiring to avail quota as mentioned above may apply for import license as per procedure mentioned in Trade Notice No. 49 dated 15th March 2019 alo....
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....cation. Clearly, the GOI had altered its position, within five weeks, because in the order dated 02.05.2020, in an application moved by Sanvira, in the pending writ petition, its position, through the statement of its counsel, was that there was no change in the allocation method, by the public notice of 17.04.2020: "4. Ms. Maninder Acharya, learned ASG submitted that repeatedly the applicant/petitioner has been seeking the same relief which was denied to it by the Supreme Court and not only the instant application but the writ petition itself was an abuse of the process of the court. The learned ASG submitted that merely because a public notice was issued, no fresh cause of action accrued in favour of the applicant/petitioner and its grievance, if any could be redressed only by approaching the Supreme Court." 27. Despite the above statement, the Minutes of the meeting dated 03.06.2020, treated the letter of 04.05.2020 (by APPCB) as if Sanvira's original capacity was 3,30,000 MTPA, ignoring the consistent position, whereby its claims to that effect were rejected about five times previously. Keeping this background, the single judge concluded as follows: "37. A ....