@JUDGMENTTAG-ORDER
Kalyan Jyoti Sengupta, J.@mdashBy this writ petition the petitioner has challenged the impugned circular being No. 28 (RE): 98 dated 28th July,
1998 being Annexure-GG to the petition. Admittedly, the writ petitioners are the exporters of the textile goods namely Gents jackets with or
without lining both knitted and woven. In this case the petitioner''s grievance is that in terms of the export policy the petitioner exported 8
consignments of textile goods abroad and those goods are concerning woven materials. According to the petitioner they are entitled to get duty
exemption (DEPB) credit as per notified rate as in Annexure-F to the writ petition. The applications were made for the exports which had taken
place immediately after the aforesaid impugned circular being issued. Those applications were not processed in accordance with the previous
notification wherein there is no mention of charging value cap for DEPB entitlement sofar as woven materials are concerned. The department
concerned, however, insisted on complying with the aforesaid clarificatory circular which is under challenge and sought to impose value cap of Rs.
200/- in case of woven materials also. Mr. Mehta, learned Counsel appearing in support of the application contends that the aforesaid clarificatory
circular issued by the Deputy Director is wholly illegal and ultra vires the provision of Sections 3 and 5 of the Foreign Trade (Development and
Regulation) Act, 1992. According to him the aforesaid impugned circular was not notified in the official gazette and the same cannot be treated as
an amendment of the previous notification. This amendment can only be done under the provisions of Section 5 read with Section 3 of the
aforesaid Foreign Trade (Development and Regulation) Act, 1992. He also contends that this clarificatory power is not extended to make
amendment either. In support of his submission he has relied on a Division Bench judgment of this court reported in Enterprise International Ltd.
Vs. Collector of Customs, . He contends that by the previous notification certain benefit was given to the exporters so far as the aforesaid materials
are concerned and such benefit cannot be taken away by the Deputy Director of Foreign Trade in terms of the aforesaid impugned clarificatory
circular. Further he contends that the clarificatory circular cannot take place by way of amendment. In support of his submission he has relied on
the decision of the Supreme Court reported in Bengal Iron Corporation and another Vs. Commercial Tax Officer and others, . Therefore, he
contends that the applications which have been made by his client should be directed to be considered ignoring the impugned aforesaid circular. He
has shown me an interim order passed by this Court in this matter on 6th April, 1999 whereby the petitioners were allowed to make the
applications for taking duty exemption entitlement with a value cap of Rs. 200/- per piece even for woven gents jacket with or without lining
without prejudice. According to Mr. Mehta in terms of the aforesaid interim order his client has already made this application and the same has
been processed. He contends that if the writ petition succeeds then the aforesaid interim order will not have any binding effects and his application
for the duty exemption entitlement should be granted without value cap of Rs. 200/- per piece in case of woven materials also.
2. Mr. Basu, learned Senior Advocate contends, first of all, that the petitioner has alternative remedy. The petitioners should have referred this
dispute under Clause 4.13 of Export and Import Policy which was then applicable and secondly, the Director could have taken decision in this
regard. Since there is dispute and doubt as to whether value cap is imposable in case of woven materials or not this could have been finally
decided by the Director himself. Therefore, the writ petition should not be allowed.
3. On merit Mr. Basu contends that clarification has been given by the Director as there were various problems and some disputes and doubts
arose at one point of time, the Deputy Director is quite competent to issue such clarification by the aforesaid impugned notice to obviate this
problem. He contends that the effect of the circular is not really an amendment of any provision of law. By this notice only the doubt has been
removed and so value cap has been imposed in case of woven gents jackets with or without lining. Mr. Basu, however, in his usual fairness submits
that if I hold that this circular has got effect of amendment of the previous circular issued under the aforesaid Act for Duty Entitlement Pass Book
Scheme then possibly there is some merit in the contention of the writ petition.
4. Having heard the respective submissions of the learned Counsels I am to examine as to whether the existence of alternative remedy is a bar in
entertaining the writ petition. While doing so, I am to examine whether Clause 4.13 as mentioned in Export and Import Policy is really an
alternative remedy or not. So I appropriately reproduce the aforesaid clause :
If any question or doubt arises in respect of the interpretation of any provision contained in this Policy, or regarding the classification of any item in
the book titled ""ITC (HS) Classifications of Export and Imports items"", the said question or doubt shall be referred to the Director General of
Foreign Trade whose decision thereon shall be final and binding.
If any question or doubt arises whether a licence has been issued in accordance with this Policy or if any question or doubt arises touching upon
the scope and content of a licence, the same shall be referred to the Director General of Foreign Trade whose decision thereon shall be final and
binding.
5. In my careful examination of the aforesaid clause it appears that the aforesaid clause will be applicable only in case where there is any question
''or doubt in respect of interpretation of any provision contained in the Policy or regarding the classification of any item in the book titled ITC(HS)
Classification of Export and Import items. Having regard to the subject matter of the writ petition and having noted the title of DEPB rates I am of
the view that there is no room or scope for any doubt or dispute where any interpretation is required. Therefore, I hold that the aforesaid clause is
not an alternative remedy atleast in this case. Even assuming that the aforesaid clause comes to be an alternative remedy then in this case theory of
alternative remedy will not be applicable in view of the fact that the writ petition was admitted by this court without any reservation. Therefore,
alternative remedy would not be applicable in this case. Moreover, by this writ petition the legality and validity as well as the authority of the
Deputy Director has been challenged in issuance of the aforesaid impugned clarificatory circular. Therefore, I am unable to persuade myself to
accept the argument of Mr. Basu that the writ petition should not be entertained.
6. Now coming to the question on merit no law has been shown to me that the Deputy Director can issue any clarification on his own motion or
without any application being made in general. By the EXIM Policy of the relevant years it has been declared in no uncertain terms that in order to
get Duty Entitlement credit in DEPB scheme the exporter need not have to pay value cap in case of woven gents jackets with or without lining and
this notification was issued in terms of the aforesaid Act by the appropriate authority. I do not find that the impugned circular has been notified in
accordance with the provisions of Section 3 of the aforesaid Act also.
7. I am of the view that the effect of this impugned clarificatory circular is nothing short of amendment of the previous circular and such amendment
can only be done in accordance with the provision of Section 5(3) of the aforesaid Act and read with Section 3 thereof. Therefore, the impugned
circular is wholly ultra vires of the provision of the said Act and this view of mine is supported by decision of this Court reported in Enterprise
International Ltd. Vs. Collector of Customs, as cited by Mr. Mehta. The Division Bench of this Court has held amongst others that the impugned
clarification resulted in rendering the petitioners'' Exim Scrips/REP Licences ineffective. Licences could only be cancelled or rendered ineffective in
terms of Paragraphs 9 and 10 of the Import Control Order. The impugned circular did not come within any of those grounds. It has also been held
further that the impugned clarification and/or notice has no statutory force and by the impugned circular right under the licences cannot be taken
away. In the Supreme Court''s decision Bengal Iron Corporation and another Vs. Commercial Tax Officer and others, cited by Mr. Mehta it has
been held amongst others that the departmental clarifications and circulars cannot be given effect to in derogation of the provisions of the Act and
also the previous notification. Therefore, I set aside the impugned circular and I direct the respondents to process the petitioner''s application
ignoring the aforesaid impugned circular and in accordance with the rules then prevailing. Therefore, the application which has also been processed
in terms of the interim order should be given effect without imposing the value cap of Rs. 200/- so far as the woven jackets with or without lining
are concerned. This application shall be processed and disposed of within a period of 8 weeks from the date of communication of this order.
8. However, this order will be restricted to these petitioners only.
9. Therefore, the writ petition succeeds. There will be no order as to costs.
10. All parties concerned are to act on a xerox signed copy of this Dictated Order on the usual undertakings.