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Judgment
S. Ravindra Bhat, J.—Heard the learned Counsel for the parties.
In terms of the Foreign Trade Development and Regulations Act, 1992 (the Act) and schemes formulated under the FEMA, the petitioners had availed of various FCFS licenses/benefits. The terms and conditions of such licenses were that the applicant/beneficiary had to export and realize the consideration in a time bound manner. To secure compliance, the licensee had to furnish bank guarantees for various amounts.
The controversy in this case is that the respondents alleged that the petitioner had not fulfilled the terms and conditions; they sought to enforce the security, furnished by way of the bank guarantees.
The Apparel Export Promotion Council (AEPC), the quota administrating agency, considered the petitioner''s documents in the first instance and concluded that there was no fulfillment of export obligations by it, rendering bank guarantees liable for forfeiture to the extent of Rs. 8,79,867/-. The petitioner preferred an appeal; the first appellate body by its order dated 31.3.2004 partly allowed the appeal and reduced the forfeiture amount to Rs. 5,39,919/- The petitioner preferred a further second appeal to the second respondent. One of the main contentions before this body was that 5th quota certificate had not been allotted to the petitioner; if the quotas reflected in those documents were excluded, the petitioner would be deemed to have exported 92% of the total quota requirements entitling it to full refund.
The second appellate body after considering the submissions held as follows:
The 2nd Appellate Committee considered the appeal in detail during the meeting and also heard Shri Naqvi the representative of the appellant firm besides the representative of AEPC. The Committee noted that the exporter is now taking the plea that although 5 Quota Certificates (QCs) have not been allotted to them still AEPC has taken these 5 QCs while calculating the utilization. If these QCs are ignored then the utilization touches 92% entitling the exporter to full relief. The Committee considered the matter further. It felt that the issue involved is one of removal of discrepancies and calculation of utilization thereafter. AEPC is, therefore, directed to again re-check all the relevant records and arrive at the correct utilization figure and allow admissible relief, if any, made out on such-recalculation. No other relief is found admissible. The appeal is so decided.
It is contended that the AEPC did not comply with the direction of the 2nd appellate body.
During the pendency of the proceedings, the AEPC, 4th respondent filed an affidavit on 23.8.2008. In terms of this affidavit, the AEPC deposed that 4th quota certificate was in fact not issued. In terms of the averments, the total quantity allocated to the petitioner was Rs. 3,40,394/-; after deducting the quantities of the 4th quota certificates, such amount got reduced to Rs. 3,34,027/-. In terms of the affidavit and the worksheets annexed to it, the AEPC''s position now is that the total exported quantum is to the tune of 89.24%, therefore, forfeiture to the extent of Rs. 3,63,087/-, is justified.
The Court has considered the submissions of the parties. During the hearing, learned Counsel for the petitioner submitted that the additional affidavit and the reasons given by the AEPC now are contrary to the record as it should have excluded the other documents which would have resulted in the exclusion of the 5th certificate. On the other hand, learned Counsel for the AEPC submitted that the 5th certificate had a rectifiable discrepancy and, therefore, was entitled to be reckoned as a quota allocation.
It is evident that the rival stands would entail investigation of the scheme as well as documents furnished by the petitioner and contentions as to its being qualified for exclusion on the one hand, and asserted to the contrary by the AEPC. This Court is hardly in a position to enquire into the matter and render findings on such factual basis. Besides this virtually amounts to the Court overseeing the effect of the remand without existence of a subsequent adjudication order. In the circumstances, it would be appropriate that the AEPC passes a speaking order after considering the relevant circumstances and giving such hearing to the petitioners as is being expedient.
During the pendency of the proceedings, the Court had made an interim order staying encashment of bank guarantees; it was also directed that in case the bank guarantees had already been invoked, the amount should be kept aside.
In the circumstances, the impugned invocations made to the Dena Bank and the Citi Bank both dated 16.8.2005 forfeiting the amount of Rs. 4,80,233/- and 3,79,834/- are hereby quashed.
The Writ Petition is allowed to the above extent. All rights and contentions of parties are reserved.