Case Stats
Citation: AIR 1995 SC 370: (1996) 53 ECC 107: (1995) 75 ELT 32: (1995) 1 JT 219: (1994) 4 SCALE 840: (1995) 1 SCC 345: (1994) 5 SCR 278 Supp
Case No: Civil Appeal No. 7153 of 1994 etc.
Date of Decision: 08-11-1994
Court: Supreme Court of India
Judges: K.S. Paripoornan, J ; J. S. Verma, J
Final Decision: Dismissed
Bench: Division Bench
Name of the Court
Supreme Court of India
All Citations of the Case
AIR 1995 SC 370: (1996) 53 ECC 107: (1995) 75 ELT 32: (1995) 1 JT 219: (1994) 4 SCALE 840: (1995) 1 SCC 345: (1994) 5 SCR 278 Supp
[Judgment Source]
https://www.courtkutchehry.com/Judgement/Search/AdvancedV2?docid=267335
Facts of the Case
The appellants contracted to import split steering fatty acids under the Import & Export Policy 1983-84. An irrevocable letter of credit was opened before the policy was amended on 11.11.1983, which canalised the item, restricting its import only through STC. The policy exception only applied to goods already shipped before the amendment. The shipment in this case occurred after the amendment, and import was not routed through STC. The High Court rejected their writ petition, and they appealed to the Supreme Court.
Law Points Raised
1. Whether opening an irrevocable letter of credit prior to policy change protected import rights.
2. Whether the amendment could retrospectively affect lawful transactions.
3. Whether denial of exception to shipments not already made violates Article 14.
4. Whether the classification between goods in transit and others is rational.
Acts/Provisions/Articles Referred
• Constitution of India, 1950 — Articles 14, 19
• Customs Act, 1962 — Section 25
• Imports and Exports (Control) Act, 1947 — Section 3
Judgements Referred
• Kanishka Trading v. Union of India (1994)
• D. Navinachandra & Co. v. Union of India (1987)
• Universal Imports Agency v. Chief Controller of Imports (1991)
• Kaptan’s Enterprises v. Union of India (AIR 1986 Delhi 221)
Obiter Dicta
Equity must be balanced against public interest in matters of exemption withdrawal. Importers cannot rely on estoppel where policy changes are justified by broader economic or legal considerations.
Ratio Decidendi
The exemption and policy benefits can be modified or withdrawn in public interest. The cut-off condition of 'shipment already made' for the exception was upheld as reasonable. Promissory estoppel does not apply to policy changes made in public interest.
Final Ruling
The Court dismissed the appeal, upheld the amended policy, and found the classification reasonable. It held that the goods not shipped before the policy change do not qualify for exception. ₹10,000 cost imposed.
Relevant Paragraph Numbers
• Para 3–4: Policy details and amendment
• Para 5–6: Legal arguments on estoppel and Article 14
• Para 7–10: Discussion on precedent and final ruling
Summary
This case involved the import of fatty acids affected by a mid-policy amendment. The appellants argued against the retrospective application of the restriction. The Court ruled that benefits under import policy can be withdrawn in public interest, and exceptions made only for goods already shipped are constitutionally valid. Promissory estoppel was found inapplicable. The classification between shipped and non-shipped goods was held reasonable. Appeals were dismissed with costs.