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Advocates
  • Somnath Chatterji
  • R.L.Gaggar
  • Pronob Dutta
  • N.C.Roy Chaudhary
  • Bhaskar Gupta
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  • Susanta Chatterji, J.
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Citation Codes
Equivalent Citations
citation codes
Case Number
Advocates
  • Somnath Chatterji
  • R.L.Gaggar
  • Pronob Dutta
  • N.C.Roy Chaudhary
  • Bhaskar Gupta
Judges
  • Susanta Chatterji, J.
Acts
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Smart Summary

Summary of Judicial Opinion

Factual and Procedural Background

Multiple writ petitions were filed in the Original Side challenging: (a) Public Notice No. 122-ITC(PN)/88-91 dated 28 April 1989 (Annexure “E”), and (b) Import Trade Control Order No. 52/88-91 dated 28 April 1989 (Annexure “D”), both issued by the Ministry of Commerce, Government of India.

The principal relief sought by petitioners Kalindi Woollen Mills (P) Limited and one of its shareholders was a writ of mandamus directing revocation/cancellation of the Public Notice and Control Order and restraining respondents from giving effect to them. The challenged amendments inserted a condition in Open General Licence No. 1/88 (dated 30 March 1988) that “Imports of Woollen rags/Synthetic rags/Shoddy Wool will be allowed through two ports only viz. Bombay and Delhi, ICD.”

The petitioners operate a factory in Ghaziabad, use woollen/synthetic rags and shoddy wool as raw material, and had entered into several overseas contracts (January–April 1989) based on the earlier OGL regime. After the 28 April 1989 measures, petitioners discovered the changes and challenged them as ultra vires and discriminatory. Customs authorities at Calcutta issued a public notice allowing certain shipments to be cleared there if shipped within sixty days from 28 April 1989; petitioners also challenged related customs actions (including redemption fines). The matter was heard at length by the Bench.

Legal Issues Presented

  1. Whether the Public Notice No. 122-ITC(PN)/88-91 and Import Trade Control Order No. 52/88-91 (dated 28 April 1989) are intra vires the powers granted to the Central Government under section 3 of the Imports & Exports (Control) Act, 1947.
  2. Whether the restriction limiting imports of woollen rags/synthetic rags/shoddy wool to two specified ports (Bombay and Delhi ICD) is arbitrary or discriminatory and therefore violative of Article 14 (and related constitutional protections such as Article 301/Article 19 where argued).
  3. Whether conditions governing imports under Open General Licence (OGL) may lawfully be amended so as to affect imports under Additional Licences (paragraph 215 of the Import Policy)—i.e., whether OGL conditions extend to or bind Additional Licence imports.
  4. Whether the policy decision to restrict entry points of specified OGL items is immune from judicial scrutiny as a non-justiciable policy choice of the executive.

Arguments of the Parties

Petitioners' Arguments

  • The impugned Control Order and Public Notice are ultra vires section 3 of the Imports & Exports (Control) Act, 1947 and the Imports (Control) Order, 1955, because the Act does not permit the Central Government to select particular ports through which goods otherwise importable must be brought into the country.
  • Section 3(3) (as read by petitioners) concerns post-importation regulation and cannot be used to impose pre‑import restrictions on points of entry; section 3 powers relate to goods by description and not to destination or ports of entry.
  • The restriction to Bombay and Delhi ICD discriminates against factories in Eastern and North-Eastern India (higher transportation cost), amounting to arbitrary classification and violation of Article 14; petitioners relied on precedents holding that burden of reasonableness is on the State.
  • The Import Policy’s paragraph 215 (Additional Licences) does not state that OGL conditions apply to additional licences; hence OGL conditions cannot be extended to additional licences by the impugned Public Notice/Control Order.
  • The petitioners contended the impugned measures caused concrete inconvenience and extra cost and sought relief to protect pre-existing contracts and import arrangements.

Respondents' Arguments

  • The measures were adopted in public interest to prevent misuse of OGL (unscrupulous traders importing finished garments disguised as rags) and to curb widespread abuse; restriction to specified ports was an administrative measure to ensure effective control and to plug loopholes.
  • Section 3(1) empowers the Central Government to regulate not only importation but also points of entry and subsequent disposal/use of imported goods; earlier Supreme Court authority (AIR 1963 SC) supports such broader powers under section 3.
  • The policy decision is within the executive’s domain and is not immune from review only in narrow circumstances; but absent glaring unconstitutionality courts should not substitute their view for policy choices. The respondents relied on authorities limiting judicial interference in policy matters.
  • Customs and licensing authorities clarified that conditions applicable to OGL items were made applicable to Additional Licences subject to certain exceptions (telex from Chief Controller); respondents denied the petitioners’ factual and legal allegations.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
AIR 1975 Cal. P. 440 — Hoare Miller & Co. Ltd. v. Assistant Collector of Customs Interpretation of section 3(1): “description” refers to qualities of goods and not identification by destination; orders under s.3(1) must be construed strictly and cannot, by description, prohibit by destination. The Court considered this authority at length but found it not directly helpful to petitioners because that case dealt with export restrictions by description; the Bench held the present case concerns administrative restriction of points of entry for imports and therefore the Hoare Miller principle did not decide the present issue in favour of petitioners.
AIR 1987 Cal. P. 181 (Division Bench) — affirmation of Hoare Miller Affirmation of the Single Judge's view on the scope of s.3(1) as discussed in Hoare Miller. The Bench acknowledged the Division Bench’s affirmation is binding but held its proposition did not assist petitioners on the question of controlling points of entry for imports.
AIR 1963 SC, Page 1470 — Abdul Aziz v. State of Maharashtra Section 3(1) is not limited to point-of-entry control but extends to control of subsequent disposal/use; licensing authority may regulate use to make import control effective. The Court relied on this Supreme Court authority to support the view that the Central Government can control points of entry and subsequent use for effective regulation and to prevent diversion/misuse.
AIR 1988 SC, P. 1291 — Federation of A.I.R. & C.E. Stenographers v. Union of India Principles under Article 14 — classification must be reasonable, founded on intelligible differentia with a rational nexus to the object sought to be achieved; Article 14 protects against arbitrariness. The Court restated the Article 14 test from this decision and applied it: it examined whether the classification (restricting ports) had an intelligible basis and rational nexus with the object (preventing abuse). It found petitioners had not demonstrated sufficient suffering or lack of nexus.
AIR 1980 SC, Page 1149 — Union of India v. D. Damani & Co. National policy on import/export is generally not to be interfered with by courts unless there is glaring unconstitutionality; courts should be cautious in superseding policy decisions. The Court cited this authority as guidance that policy measures adopted by the Government should not be lightly struck down; it applied the principle to decline interference absent clear unconstitutionality.
AIR 1984 SC, Page 1543 — Maharashtra State Board... v. Paritosh Bhupesh Kurmarsheth Delegated legislation and the limits of judicial scrutiny: the Court’s role is to test whether regulations fall within delegated power and statute’s object/purpose, not to second-guess policy wisdom. The Court invoked this precedent to emphasize that its scrutiny is limited to whether impugned regulations fall within statutory power and purpose; it refused to substitute its view of policy for that of the executive.
AIR 1964 SC, Page 370 — Gopal Narain v. State of Uttar Pradesh Guidance on discerning administrative/legislative policy from statutory provisions and the appropriate role of courts when policy must be inferred from an Act. The Court used this precedent to explain how a court may ascertain the policy underlying a statute and to justify deference to a clearly discernible policy, subject to constitutional bounds.
AIR 1969 Bombay, P. 224 — Ganpat Bapurao Bibekat v. Rameshwar Shalligram Pitambarwale Recognition that section 3 and related orders are within legislative competence and may regulate imports for public interest; assessment of reasonableness under Article 19(6) may be necessary. The Court referred to this decision to support the proposition that controls under the Act are within competence and to inform the reasonableness inquiry under constitutional provisions.
AIR 1952 Madras, Page 840 — S.P. Shaik Abdul Khader & Co. v. A.R. Subramania Pillai That the Imports & Exports (Control) Act does not violate fundamental rights; provides context for upholding control legislation within constitutional bounds. The Court cited this case as part of the historical line of authority upholding the Act's constitutionality and supporting regulation of imports under the Act.
1987 (29) ELT 753 (Full Bench Delhi High Court) — Jain Exports Pvt. Ltd. v. Union of India; affirmed by (1988) 3 SCC 579 Where an item is transferred from OGL list to canalised list during currency of licence, it cannot be imported under the earlier OGL regime; revalidation does not override later policy/list changes at time of arrival. The Court relied on and discussed this line to address petitioners' argument about continuity of import rights under OGL/additional licences; the Court held that policy changes can validly affect importability and that relevant conditions may apply to Additional Licences where policy and conditions operate consistently.

Court's Reasoning and Analysis

The Court conducted a structured analysis focused on: (1) the statutory ambit of section 3 of the Imports & Exports (Control) Act, 1947; (2) the constitutional challenges (Article 14, Article 19/301 aspects); and (3) the relation between OGL conditions and Additional Licences under the Import Policy.

Statutory scope of section 3:

  • The Court examined the text of section 3(1)–(3) and earlier judicial authority. It observed that section 3 empowers the Central Government to make provision for prohibiting, restricting or otherwise controlling imports and that such powers have been interpreted to extend to control over points of entry and subsequent disposal/use of imported goods (citing AIR 1963 SC and related authorities).
  • While acknowledging Hoare Miller (AIR 1975 Cal.) and its Division Bench affirmation (AIR 1987 Cal.), the Court distinguished those authorities as principally addressing export restrictions and construction of “description” in a different factual matrix; accordingly, those decisions did not determine the present question whether points of entry for imports may legitimately be restricted.

Reasonableness and Article 14:

  • The Court applied the Article 14 test of intelligible differentia and rational nexus (as articulated in the AIR 1988 SC authority). It accepted that classification is permissible but must be founded on an intelligible basis and have a rational nexus with the object sought to be achieved.
  • Examining the factual record, the Court concluded that the restriction to Bombay and Delhi ICD was adopted to curb abuse (import of serviceable garments falsely described as rags) and to enable effective administrative control. The Court found a rational nexus between the restricted points of entry and the object of preventing misuse.
  • The petitioners failed to demonstrate concrete and substantial prejudice (the Court noted petitioners' factories were in Uttar Pradesh/near Delhi and did not show sufficient data of actual hardship resulting from the restriction). On the record, the Court did not regard the classification as arbitrary or unreasonable.

OGL conditions and Additional Licences:

  • The Court reviewed Import Policy paragraph 215 and related OGL conditions. While petitioners argued OGL conditions should not be applied to Additional Licences, the Court found that the policy and conditions are to be construed consistently and that changes in conditions governing OGL items can impact Additional Licence importation where the policy and statutory framework reconcile in that manner.
  • The Court referred to the Full Bench Delhi judgment and its Supreme Court affirmation (Jain Exports → (1988) 3 SCC 579) which supported the proposition that policy changes can affect importability even of pre-existing licences depending on timing and conditions; the Court applied that reasoning to conclude persons with Additional Licences do not necessarily retain broader freedom to import the items via excluded ports when consistent policy changes are made.

Role of judicial review and deference to policy:

  • The Court emphasised established authorities that judicial interference with executive policy is limited: courts must determine whether delegated regulations fall within statutory powers and conform to constitutional requirements, but should not substitute their own view of policy unless there is glaring unconstitutionality.
  • Applying that principle, and given the evidence of misuse and the administrative objective to curb diversion, the Court concluded that the impugned measures fell within the statutory power under section 3 and were not constitutionally infirm.

Conclusion of analysis:

  • The Court found the impugned Public Notice and Imports Trade (Control) Order were not contrary to section 3 of the Act, did not violate Article 14 (or other constitutional provisions relied upon), and represented a reasonable administrative measure in public interest to prevent abuse.
  • The Court rejected the petitioners’ challenge to the consistency of OGL conditions vis-à-vis Additional Licences, holding the policy and related conditions can be construed to apply so as to achieve the regulatory objective and that petitioners had not established a legal basis to override the amendment.

Holding and Implications

Holding

The writ petition is DISMISSED. The Court concluded that the Import Trade (Control) Order No. 52/88-91 and Public Notice No. 122-ITC(PN)/88-91 dated 28 April 1989 are within the statutory power under section 3 of the Imports & Exports (Control) Act, 1947 and are not violative of Article 14 or other constitutional provisions as argued by the petitioners.

Immediate Consequences and Practical Effects

  • The writ petition was dismissed and the Court found no merit to grant relief to the petitioners.
  • All interim orders, if any, were vacated. However, by consent and upon prayer of counsel, the Court granted a stay of operation of the order for a fortnight (two weeks) from the pronouncement.
  • There was no separate order as to costs.
  • The Court directed that the ratio of the decision applies to other pending writ petitions; those petitions may be disposed of by placing them in the daily list for hearing in accordance with law and procedure.
  • Administrative direction: parties may act on a Xerox copy of the order on usual undertaking (as recorded in the opinion).

Note: The summary above is strictly confined to the material and reasoning contained in the provided judicial opinion. No facts, holdings, or implications have been added beyond what the Court stated in that opinion.

Show full summary ...

    M/S. Kalindi Woollen Mills (P) Ltd. & Anr. v. Union Of India & Ors.

    The Court:— A good number of writ petitions have been moved in the Original Side of the Constitutional Writ Jurisdiction of this Court challenging a Public Notice bearing No. 122-ITC(PN)/88-91 dated 28th of April, 1989 issued by the Ministry of Commerce, Government of India, New Delhi and an Import Trade Control Order No. 52/88-91 dated 28th of April, 1989 issued by the Ministry of Commerce, Government of India. The present case has been heard by this Bench patiently considering lengthy submissions advanced by the learned counsel appearing for the respective parties. The petitioners Kalindi Woollen Mills (P) Limited, a Company and the petitioner No. 2 being one of its shareholders have come to this Court seeking reliefs by way of issuance of a Writ of Mandamus commanding and directing the respondents to revoke, rescind and cancel the order and/or the Public Notice dated 28th of April, 1989 copy of which is Annexure “D” to the present writ petition and also the Public Notice No. 122-ITC(PN)/88-91 dated 28th April, 1989 copy of which is Annexure “E” to the writ petition and restraining them from giving effect to or taking any step in term's thereof or thereunder and to grant consequential reliefs thereof. Annexure “D” indicates inter alia that in exercise of the powers conferred by section 3 of the Imports and Exports (Control) Act, 1947 (18 of 1947), the Central Government makes the following amendment in the Open General Licence No. 1/88 dated 30th March, 1988, published under the Notification under the Government of India in the Ministry of Commerce No. 329(E) dated 30th March, 1988 viz:

    In the said Open General Licence No. 1/88, in condition Number 14, after sub-clause (iii), the following shall be inserted, namely:—

    (iv) Imports of Woollen rags/synthetic rags/Shoddy Wool will be allowed through two ports only viz. Bombay and Delhi, ICD.”

    2. Similarly, Annexure “E” is quoted verbatim as it is:—

    COPY OF —

    PUBLIC NOTICE NO. 122-ITC(PN)/88-91

    Dated 28th April, 1989

    Import & Export Policy for April 1988.March 1991

    Attention is invited to the Import & Export Policy for April 1988—March 1991 published under the Ministry of Commerce Public Notice No. 1-ITC (PN)/88-91 dated the 30th March, 1988, as amended.

    2. The following amendment shall be made in the Policy at appropriate places indicated below:

    SI. No. Page No. of Import and Export Policy 1988–91 Volume I Reference Amendment 1. 170 Appendix 6 Conditions governing imports under Open General Licence. After the existing condition No. 25(ii) the following condition shall be added: “(iii) Imports of Woollen rags/Synthetic rags/Shoddy Wool will be allowed through two ports only viz. Bombay and Delhi ICD”.

    3. The above amendment in the Import & Export Policy has been made in public interest.

    Issued by:

    Ministry of Commerce

    New Delhi.

    3. The petitioners allege in details that the Company has a factory at Village Dhoom Manikpur, in the District of Gaziabad in the State of Uttar Pradesh and the principal raw material required for running the said factory by the petitioners, is rag's, both Woollen and synthetic as well as Shoddy Wool. The availability of the said goods in the country being inadequate, the same are allowed to be imported under the Open General Licence Scheme of the Government of India contained in the Import Policy 1988-91, and the importation of the said goods was allowed under the Import Policy subject to the conditions imposed regarding, inter alia, importation through canalising agency and/or importation under specific licences, by the Import Licensing Control Authorities. It is further stated in details that under the said Import Policy, the Government of India in exercise of powers conferred upon it under section 3 of the Imports and Exports (Control) Act, 1947 issued on the 30th March, 1988 an order being Open General Licence No. 1/88 whereby the said goods were allowed to be imported under the Open General Licence Scheme subject to the conditions contained in the said Control Order. The Import Policy contained appropriate provisions of Appendix-IV thereof. It is placed on record that one of the conditions under which the said goods are allowed to be imported by an Actual User thereof is that the contract for importation of such goods has to be registered prior to importation of the said goods with the Textile Commissioner of the Government of India and it is only after the contracts are registered with the said Textile Commissioner and appropriate registration number is granted by the said Authority, one can import the subject consignment accordingly. The allegation of the petitioners is that the petitioner Company acting on the basis of the representation made by the respondents under the Open General Licence Control Order No. 1/88 dated 30th March, 1988 entered into six several contracts during the period January, 1989 to April, 1989 with foreign sellers for purchase and importation of consignments of the goods required to be used at its factory as raw materials on the terms and conditions and/or of quantity and specification as contained in the respective indents thereof. In or about May, 1989, the petitioners have, however, come to learn that the Control Order bearing No. 52/88/91 dated 28th of April, 1989 has been issued to the said Open General Licence and the same is referred by way of Annexure “D” to the present writ petition. The petitioners have” also found the change of the import policy in view of the Public Notice copy of which is Annexure “E” as detailed above. Meanwhile, however, on or about 16th of June, 1989 a Public Notice was issued by the Collector of Customs, Calcutta allowing importation through Port of Calcutta of the said goods if the shipment's of the goods covered by the Import Contracts prior to the issuance of the Public Notice were effected within 60 (sixty) days from 28th April, 1989 i.e within 27th of June, 1989. Since certain steps have been taken by Customs Authorities at Calcutta by way of redemption fines, the petitioners have challenged to quash the ‘same also. Mainly, the aforesaid Annexure “D” and “E” to the writ petition as detailed above have been very seriously challenged on the grounds that there is no provision in the Imports and Exports (Control) Act, 1947 whereby the respondents can restrict importation of good's which are otherwise importable into the country on, inter alia, the terms and conditions if contained in the Import Policy and/or the Open General Licence governing such importation through any one or two ports in the country to be picked and chosen at the whims and fancy of the respondents. Any attempt to restrict importation of the goods only to the Port of Bombay and Delhi ICD are therefore, illegal, invalid, null and void. It is highlighted that section 3 of the aforesaid Act enables the Central Government to, in the manner provided in the said section, prohibit or restrict import and export of goods of any specified description. The power under section 3 of the said Act is general in nature and hence any restriction or prohibition imposed under the said section has to be applicable in all parts of the country for the public interest. The power under the said section 3 of the said Act cannot by any stretch of imagination be construed to enable the Central Government to pick and choose at its whims and fancy, particular ports through which only certain goods can be imported into the country and restricting and/or prohibiting importation of such goods from other Ports in the country. Any prohibition or restriction or control of any kind whatsoever under section 3 of the said Act has to be applicable to the entirety of the country, if the said goods are allowed to be imported into the country under the Open General Licence Scheme of the Government of India. There can be no legal valid basis of justification whatsoever to restrict their importation in the country only through the Port's of Bombay and Delhi ICD. Accordingly the petitioners have made a case that the purported order and/or the purported Public Notice is discriminatory and arbitrary and violative of Article 14 of the Constitution of India and by issuance of the said Order and/or the Public Notice, the respondents are seeking to discriminate between persons similarly situated and the owners of the factories which are situated in the Western and North-Western parts of the country would now be able to import the goods at a much lesser price than owners of factories which are situated inter alia, the Eastern and North-Eastern part of the country as the additional cost of transportation of goods from Bombay and Delhi to their respective destination's would have to be borne by them for no fault of theirs and the order and the Public Notice are alleged to have been issued in gross abuse of the powers conferred upon the respondents under section 3 of the said Act and those are discriminatory in nature and the same should be quashed by issuing an appropriate writ of this Court. The petitioners have, however, given the details of their inconveniences and extra-costs to be incurred for the restrictions as several complications have arisen to import the goods through the two Ports viz. Bombay and Delhi ICD.

    4. The writ petition is strongly opposed by the respondents. Affidavits-in-opposition have been filed in two sets viz. one by the respondent no's. 1, 2 and 3 and the other by the respondent nos. 4 and 5. The Deputy Chief Controller of Imports and Exports, Government of India, Ministry of Commerce has placed on record that prior to the issue of the Open General Licence Order No. 1/88 dated 30.3.88 the importation of Woollen/Synthetic rags was restricted and/or allowed to be imported by the canalising agency only and/or under specific licence. In order to help the genuine Actual Users of such Woollen/Synthetic rags it was decided to allow importation of such goods under OGL and the same was implemented under OGL Order No. 1/88 dated 30th March, 1988. After the said goods have been incorporated as an OGL item, various unscrupulous traders were flooding the Indian Market with imported woollen/synthetic finished goods by importing it under the cover of Woollen/Synthetic rags to the great detriment of the local manufacturers and it was found that the said unscrupulous traders were importing serviceable garments or cut garments which could be easily stiched as serviceable garments falsely and wrongfully descripting them as woollen/synthetic rags. Large quantities of importation were seized in Delhi as also in Calcutta prior to April, 1989. To prevent such abuse, it was thought that the importation of such rags should be restricted and to make such changes it required times for various Ministries including the Textile and Commerce Ministry, and as an interim measure till such decision was made, it was decided to restrict, control and also the clearance of such goods was effected by restricting such importation and clearance to Delhi and Bombay. It is placed further on record that most of the Actual Users and/or/owners of Woollen and Synthetic factories/mills are all situated in Western part of the country at Hyderabad. The whole object of importing of woolen Aynthetic rags was for the recovery of yarns from the same for the purpose of manufacturing other woollen products and such yarns would only be made and taken out from such rags and manufactured goods therefrom by Actual Users and/or persons and/or woollen mills. The amendment was made in public interest and the petitioners' factory is in Gaziabad near Delhi and the Company's registered office is at No. D/2r Maharani Bag, New Delhi and the present petition is misconceived accordingly. Other allegations of the petitioners have, however been controverted.

    5. The Assistant Collector of Customs has sworn an affidavit on behalf of the respondent nos. 4 and 5. He has placed on record the details of the amended order and the public Notice and to various developments for passing the interim order. It is brought to the notice of the Court that the Customs Authorities at Calcutta received a telex message dated 30.11.89 issued from the office of the respondent no. 2, Chief Controller of Imports and Exports, Government of India, Ministry of Commerce, New Delhi clarifying that all the conditions applicable for importation of OGL, item shall be equally applicable for importation of goods under Additional Licences excepting the Actual User Conditions. For any view of the matter all conditions relating to OGL have also been made applicable to the additional licences excepting the Actual User Conditions. There is also denial of all the allegations of the writ petitioners.

    6. The writ petitioners have filed affidavit-in-reply reiterating the stand taken in the main writ petition and controverting the cases as made out by the respondents separately.

    7. The learned Counsel appearing for the petitioners have mainly argued that the impugned Public-Notice and the Control Order are ultra vires the provisions of the Imports & Exports (Control) Act, 1947 and the Imports (Control) Order, 1955. It is emphasized that there is no provision in the said Act whereby the respondent can restrict importation of goods which are otherwise importable in the country on inter alia, the terms and conditions contained in the Import Policy and/or the Open General Licence governing such importation, According to them, if a particular kind of goods is allowed to be imported under Open General Licence, the same has to be allowed to be imported through any Port in the country. The importation of the goods only through Bombay and Delhi-ICD Ports, is therefore, illegal, invalid and null and void. The attention of this Court has been drawn to clauses (a) & (b) of section 3(1) of the said Act. It is submitted that while clause (b) empowers the Central Government to make provisions for prohibiting, restricting or otherwise the controlling and bringing into any port or place in India all goods of any specified description to be taken out of India without being removed from ship or conveyance in which they are being carried, whereas in clause (a) the expression “any port or place in India” is distinctly absent. A reference is made to the case reported in AIR 1975 Cal. P. 440 (Hoare Miller & Co. Ltd. v. Assistant Collector of Customs). This decision of the Single Judge was affirmed by the Division Bench of this Court as reported in AIR 1987 Cal. P. 181. It is contended that sub-section (3) of section 3 of the said Act does not empower the Central Government to issue the impugned Public Notice and the impugned Trade Control Order. The said section 3(3) of the said Act specifically provides for imposition or prohibition, restriction or conditions in respect of goods or classes of goods which have already imported into India. Accordingly, the said sub-section is concerned with a post importation situation as such user of the imported materials and after their importation, for example by actual user or by manufacturers with concomitant export obligations and accountal thereof by the said manufacturers or users. Hence, the restrictions or conditions or prohibition that would be sought to be imposed in exercise of powers under the said sub-section by the Central Government has to be on “goods” and has to be applicable to the entire country. Such a power cannot be invoked to restrict the importation of the goods through any one or two particular ports of the country.

    8. It is further argued that the purported Control Order and/or the purported Public Notice are discriminatory, arbitrary and violative of Article 14 of the Constitution of India. It is highlighted that the owners of factories which are situated in the Western and North-Western parts of the country would now be able to import the said goods at a much lesser price than owners of factories which are situated in, inter alia, the Eastern and North-Eastern parts of the country as the additional cost of transportation of goods from Bombay or Delhi would now have to be borne by them for no fault of theirs, whereas similarly situated, the owners of factories in the Eastern or North-Eastern parts of the country would now be placed in a disadvantageous position vis-a-vis their competitors in the North-Western and Western parts of the country. It is alleged that there cannot be any public interest in making such hostile discrimination. The case of violation of Article 14 of the Constitution of India has been demonstrated by referring to the decision reported in AIR 1988 SC, P. 1291 (Federation of AIR & CE Stenographers v. Union of India) and particularly the observations made in paragraph 9 at page 1299 of the said decision. It is submitted that the burden of reasonableness is upon the respondents to prove that such restrictions are permissible in law. The decision reported in AIR 1970 SC, P. 1299 has been cited in support of this contention.

    9. The policy decision of the Government cannot avoid the scrutinization of the Court and the decision of the Supreme Court reported in AIR 1984 SC, Page 1543 has been referred. The learned Advocates for the petitioners have also drawn the attention of the Court to the decision reported in AIR 1980 SC, Page 1149 where the Hon'ble Supreme Court has rejected a similar contention as made in the present case that the Government is in the best position to take a policy decision and there is a ban of judicial scrutiny of such policy decision of the Government.

    10. A further argument has been developed in support of the case of the petitioners that in paragraph 215 of the Import Policy provides for grant of additional licence to Export Houses and Trading Houses on the basis of the admissible exports made by them in the preceding licensing year. The conditions under and subject to which such licences are issued are all contained in the various clauses of paragraph 215 of the said Import Policy paragraph 215(2)(i) of the said Import Policy also provides that the additional, licences issued thereunder would be valid for the import of “items appearing in Part-I of List-VIII, Appendix VI of the said Import Policy. The said goods are “item” falling under the said list of Import Policy. It is, therefore, pertinent to note that none of the clauses of para graph 215 of the said Import Policy provides that the conditions governing imports under Open General Licence as contained in Appendix-VI of the said Import Policy would be also applicable to goods importable under the additional licence issued under paragraph 215 of the said Import Policy. Clause 2(1) of paragraph 215 of the Import Policy, according to the petitioners, refers only to the “items” contained in a Part of the List X of Appendix VI of the said Import Policy. A reference is only to the goods contained in the said list and not to the conditions to which the said goods can be imported under the Open General Licence Scheme which are contained under the head “conditions governing imports under Open General Licence”. The contracts have to be registered with the Textile Commissioner in terms of Clause 24 of the “conditions governing Imports under “Open General Licence” as contained in Appendix VI of Import Policy 1988-91. There is no such condition of importation of such woollen/synthetic rags under an additional licence.

    11. The contention of the petitioner is also that upon perusal of the Import Policy 1988–91 it would be evident that there are specific and separate provisions for grant of each additional licence and the conditions which have to be satisfied for a particular clause of category or persons to be entitled to receive any of the said licences, whereas the Open General Licence being general in nature, no specific licences are issued to each and every person. It would also be seen from the said policy that licence is issued subject to such condition and unless and until the conditions under one particular category of licence, are not specifically incorporated in the case of another category of item, such condition in the former category cannot automatically apply to the later category. It is placed on record that the Import Policy by itself has no statutory force and as such paragraph 215 has no statutory force that therefore the conditions in the OGL No. 1/88 would apply under the importation by the additional licences.

    12. The attention of this Court has also been drawn to Article 301 of the Constitution of India that subject to the other provisions of this Part, trade, commerce and intercourse throughout the territory of India shall be free. The petitioners have referred to a copy of the unreported judgment dated 25.4.90 passed by the Single Judge of the Hon'ble High Court of Judicature at Madras (B.L Tandon v. Union of India) in issuing a writ upon reason that merely because some unscrupulous importers are attempting to bring serviceable garments under the guise of mutilated rags, it would not enable the respondents to impose a restriction which is not warranted since the respondents have enough machinery, resources and manpower to device ways and means for checking the import of any unauthorised item and there cannot be a ban to import the goods through other ports.

    13. While opposing the writ petitioners, the learned lawyers appearing for the respondent authorities have tried to justify the acts done and/or caused to have been done in issuing the impugned Public Notice dated 28th of April, 1989 and the Import Trade Control Order dated 28th of April, 1989 issued by the Ministry of Commerce, Government of India. They have referred to the decision reported in AIR 1963 SC, Page 1470 contending inter alia that the power under section 3(1) of the aforesaid Act enables the respondents to not only prohibit and restrict of importation of goods as such but also their points of entry by or through any port in the country. According to them, the policy has been formed in order to prevent unscrupulous traders from importing serviceable garments and cut garments but wrongly describing them as woollen/synthetic rags and the measures have been taken to prevent the same in the manner as provided under the law. They have strongly submitted that the policy decision of the Government in permitting the importers to import into India through specific points of entry is for public benefit and this type of policy cannot be subjected to judicial scrutiny as discussed in the case reported in AIR 1984 SC, Page 1543. The Hon'ble Supreme Court has also found in AIR 1980 SC, Page 1449 that the Court cannot be called upon to decide as to whether this type of policy is right or wrong. There is also reference in support of the case of the respondents to the case reported in AIR 1964 SC, Page 370 that the classification underlying the alleged policy had to have a reasonable nexus with the object sought to be achieved. In geographical classification also, there is a reasonable relation to the object sought to be achieved and regard being had to the materials on record, it can be appreciated by this Court that the policy in question is neither unreasonable nor unfair. The respondents have strongly challenged urging inter alia that the writ petition is throughly misconceived and the petitioners having all the factories in northern and north-western parts of India cannot come to this Court to import to goods at the Calcutta Port and to seek reliefs in the manner as prayed.

    14. With great anxieties, this Court has patiently heard the contention of both sides. This Court has the occasion to go through the materials on record in details and in depth. This Court has applied its mind to consider the legality, validity and sufficiency of the impugned Public Notice bearing No. 122-ITC(PN)/88-91 dated 28th of April, 1989 as well as the Imports Trade Control Order No. 52/88-91 of the same date issued by the Ministry of Commerce, Government of India as recorded above. It is needless to observe that in course of hearing, the attention of the Court has been drawn to the fact that there is amendment of the policy clearly providing inter alia that the types of goods such as woollen rags/shoddy wool/synthetic rags will be allowed only when these are imported in completely pre-mutilated conditions through two Ports only viz. Bombay and Delhi ICD. Section 3 of the Imports & Exports (Control), 1947 (Act 18 of 1947) lays down the powers to prohibit or restrict Imports & Exports as it runs as follows:—

    Sec. 3 : (1) The Central Government may, by order published in the Official Gazette, make provision for prohibiting, restricting or otherwise controlling, in all cases or in specified classes of cases, and subject to such exceptions, if any, as may be made by or under the order —

    (a) the import, export, carriage coastwise or shipment as ships, stores of goods of any specified description;

    (b) the bringing into any port or place in (India) of goods of any specified description intended to be taken out of (India) without being removed from the ship or conveyance in which they are being carried.

    (2) All goods to which any order under sub-section (1) applies shall be deemed to be goods of which the import or export has been prohibited under section 11 of the Customs Act, 1962 and all the provisions of that Act shall have effect accordingly.

    (3) Notwithstanding anything contained in the aforesaid Act, the Central Government may, by order published in the Official Gazette, prohibit, restrict or impose conditions on the clearance whether for home consumption or for shipment abroad, of any goods or class of goods imported into India.

    15. Upon further scrutiny, it will appear that neither section 3 nor Imports (Control) Order (1955) as published in Gazette of India, Extra on 7.12.55 Exports (Control) Order, 1958 published in Gazette of India, Extra on 1.5.58 are beyond legislative competence of Central Legislature, Reference may be made to the decision reported in AIR 1969 Bombay, P. 224 (Ganpat Bapurao Bibekat v. Rameshwar Shalligram Pitambarwale). The powers conferred under section 3(1) of the aforesaid Act are not restricted merely to prohibiting or restricting imports at the point of entry of goods into the territory of India but extends also to controlling the subsequent use of the goods imported. The policy intends to conserve essential supplies for civilian consumption in this country. Provision is made for regulation by permits. An appeal is provided for grants and against refusal of permits. It has to be considered whether the restrictions imposed are “reasonable” within the meaning of Article 19(6) of the Constitution and the machinery provided for implementation of the policy is satisfactory or not. This aspect of the matter has been considered in the case reported in AIR 1952 Madras, Page 840 (S.P Shaik Abdul Khader & Co. v. A.R Subramania Pillai) that this Act does not violate the fundamental rights under the Constitution. No argument has been advanced before this Court challenging the vires of section 3 of the Imports & Exports (Control) Act, 1947 or the Imports (Control) Order, 1955. On the contrary, it has been argued that the impugned Imports Trade (Control) Order and the Public Notice issued by the Ministry of Commerce, Government of India are beyond the scope of section 3 of the Imports & Exports (Control) Act, 1947 as well as Imports (Control) Order, 1955. The main grievances of the petitioners are that the policy adopted by the Central Government to permit entry of the imported goods only through the two Ports viz. Bombay and Delhi ICD, in contrary to and inconsistent with the provisions as laid down under the Imports and Exports (Control) Act, 1947 as well as the Imports (Control) Order of 1955. The impugned Public Notice and the Order cannot have a legal force inasmuch as those are intended to make an unreasonable restriction. The steps are discriminatory in nature and they infringe the fundamental rights of free trade. The restrictions are alleged to be unjust, unfair and arbitrary and unless those are struck down there would be breaches of the fundamental rights of the petitioner as guaranteed under the Constitution of India. It is all the more argued that if the Imports Trade (Control) Order and the Public Notice are allowed to remain, there will be serious inconveniences, undue harassment and never ending discrimination. The petitioner have tried to demonstrate the nature of inconveniences by pointing the difference of Price Index to convene the importation of the foreign goods to particular points of entry and without by prohibiting the petitioners to receive imported goods in other Ports including Calcutta. The challenge as to scope of the Act as well as any Policy formulated by the Government under the Act, cannot be the subject matter of the judicial scrutiny on the basis of different Price Index or for any financial stringency. The scope of the Act, Control Order and the Policy framed thereunder are always put to test within constitutional bounds and it has to be considered whether they are just, fair and reasonable. A great emphasis has been made to the case of Hoare Miller & Company Limited v. The Assistant Collector of Customs) as reported in AIR 1975 Cal. P. 440 (Supra). The scope of section 3(1) of Imports and Exports (Control) Act, of 1947 has been considered. It was found that the expression “all cases” in section 3(1) has to be read in conjunction with specified classes of cases. The expression “all cases” cannot be so construed as to mean the goods of specified description and to mean goods identified by destination of the goods. “Description” is here an adverb relating to the goods, that is to say, to the qualities of the goods and not to the identification of the goods. When by provision, authority is given to impose restriction on the trade that provision must accordingly be construed strictly. Thus, an order under section 3(1) prohibiting export of “all goods” to a country is beyond the authority given by section 3 because there is no specification of the goods intended to be prohibited. The facts of the case tend to show that the contracts in respect of the subject goods have been entered into between Union Agencies (Distributors) Pvt. Ltd., Rhodesia and the exporters. The name of their Zambia Associates Messrs. Factors Zambia Ltd., had been utilised as a cover and Messrs. J.N Barnett & Co., Beirs as their Agent for diversion of the goods to Rhodesia. Since the exports to Rhodesia are prohibited in terms of the Government of India order No. 9/65 dated 17.11.65 issued under section 3 of the Imports & Exports (Control) Act, 1947, it appears that Messrs. Hoare Miller & Co. Ltd., have filed the shipping bills under reference in an attempt at exporting the goods to Rhodesia in contravention of the aforesaid prohibition. Steps were taken to confiscate the goods under section 113(d) of the Customs Act and thereby Messrs. Hoare Miller & Company Limited filed the writ petition. Under the background of the said facts, the Court found that the effect of the deeming provision is not with the order made under sub-section (1) of section 3 of the Imports & Exports (Control) Act, 1947. It should be deemed to have been made for the purposes as enjoined under section 11(2) of the Customs Act, 1962. The principle which should guide the interpretation of the expression of an order made under section 11 of the Customs Act cannot be applicable to an order made in sub-section (1) of section 3 of the Imports & Exports (Control) Act, 1947. The main thrust of the argument before this Court relating to the present case is that any restriction, prohibition and control under Imports and Exports (Control) Act, 1947 relates to the goods but cannot relate to the land of destination nor it can relate to the ports of entry as such by relying upon the said argument. It is argued that restriction to import the goods to any particular port and to deny other ports to receive the imported goods is contrary to and inconsistent with the provision of the Act itself. This Single Bench Judgment has been confirmed in the Division Bench as reported in AIR 1987 Cal. Page 181. With great respect, this Court has gone through the decision in between the lines. The Division Bench affirming the judgment of the Single Judge is all the more binding upon this Court. But the proposition as laid down in the aforesaid decision does not come to the help of the petitioners inasmuch as the scope of the Act has been discussed with regard to the goods for the purpose of export. Here is a question when certain goods are being allowed to be imported. The restrictions are there as to what types of goods to be brought into the country. At the time of bringing the imported goods into the country there is restriction as to the points of entry. There is no question of applicability of the restriction to any prohibited land. It is for the purpose of administrative feasibility for effective machination, for effective control and in order to plug loopholes perpetrated by unscrupulous traders to bring into the territory of the country various prohibited goods, the Government imposes restriction with the particular type of goods can be brought as per Open General Licence and/or Additional Licence through one or two or three particular points of entry to the country. It cannot be branded as an unreasonable restriction. The principle as laid down in the aforesaid decision does not have any impact upon the facts of the present case as discussed above.

    16. By looking at the decision reported in AIR 1963 SC, Page 1470 (Abdul Aziz v. State Of Maharashtra.) it has been found that the power conferred under section 3(1) of the Imports & Exports (Control) Act is not restricted merely to prohibiting or restricting imports at the point of entry of goods into the territory of India but extends also to controlling the subsequent disposal of the goods imported. It is for the appropriate authority and not for the Courts to consider the Policy, which must depend on diverse considerations, to be adopted in regard to the control of imports of goods. The import of goods can be controlled in several ways. If it is desired that goods of a particular kind should not enter the country at all, the import of those goods can be totally prohibited. In case, total prohibition is not desired, the goods could be allowed to come into the country in limited quantities. That would necessitate the empowering persons to import under licences certain fixed quantities of the goods. The quantity of goods to be imported will have to be determined on consideration of the necessity for having those goods in the country and that action would depend on the use to be made on those goods. It follows therefore, that the persons licensed to import goods up to a certain quantity should be amenable to the orders of the Licensing Authority with respect to the way in which those goods are utilised. If the Licensing authority has no such power, its control over the import cannot be effective. If may have considered it necessary to have goods imported for a particular purpose. If it cannot control their utilization for that purpose, the imported goods, after import, can be diverted to different uses, defeating thereby the very purpose in which the import was allowed and power had been conferred on the Central Government to control imports. It is, therefore, not possible to restrict the scope of the provision about the control of import to the stage of importing of the goods at the frontiers of the country. Their content is much wider and extends to every stage at which the Government feels it necessary to see that the imported goods are properly utilised for the purpose for which their import was considered necessary in the interest of the country. The provision in Clause 5 of the Imports (Control) Order (1955) empowering the licensing authority to attach a condition to the effect that the goods covered by the licence shall not be disposed of except in the manner prescribed by the licensing authority is a valid provision which comes within the powers conferred by section 3 of the said Act on the Central Government. This Court also finds that the scope of Clause 5(4) of Imports (Control) Order 1955 has been considered by the Supreme Court by observing that sub-clause (4) of clause 5 provides that the licensee shall comply with all conditions imposed or deemed to be imposed under the Clause. The contravention of any condition of a licence thus amounts to the contravention of the provision of sub-clause (4) of clause 5 of the Order and consequently to the contravention of the order made under the Act. If the licensee does not comply with the conditions of the licence about the use of the goods to be imported he contravenes the order made under the Act and makes him liable to punishment.

    17. In the instant case, the problem arises as to the legality and validity of the restrictions as imposed by the impugned Imports Trade (Control) Order and the Public Notice. It has strongly been argued that by the purported Public Notice and/or the purported order, the owners of the factories which are situated in the Western and North-Western parts of the country will now be able to purchase goods at a much lesser price than owners of factories which are situated in, inter alia, the Eastern and North-Eastern parts of the country as the additional cost of transportation of goods from Bombay or Delhi would now have to be borne by them for no fault of theirs. A case of violation of Article 14 of the Constitution of India is sought to be made out. It is urged that there could be no rationale nexus or basis whatsoever for importation of the subject goods through the Bombay Port and Delhi ICD only and by prohibiting importation thereof through the Calcutta Port. The principle in respect of classification without violating Article 14 of the Constitution has been summarised by the Hon'ble Supreme Court in the decision reported in AIR 1988 SC, Page 1291 (Federation of A.I.R and C.E Stenographers v. Union of India) as referred by the petitioners. It appears that this case has mainly considered the principle of ‘equal pay for equal work’ and to the differentiation sought to be justified on ground of dissimilarity of responsibility, confidentiality and relationship with public etc. It has been emphasized that Article 14 of the Constitution strikes at the arbitrariness in State action and ensures fairness and equality of treatment. It is attracted where equals are treated differently without any reasonable basis. The principle underlying the guarantee-is that all persons similarly circumstanced shall be treated alike both in privileges conferred and liabilities imposed. Equal laws must be applied equally and there should be no discrimination between one person and another if as regards the subject matter of either administrative action or of legislation, their position is substantially the same. Article 14 forbids-class legislation but permits reasonable classification for the purpose of legislation or administrative mandate. The classification must, however, be founded on an intelligible basis which distinguishes persons or things that are grouped together from those that are left out of the group and that differentia must have a rational nexus with the object to be achieved by the differentiation made in the statute or order in question. In other words, there ought to be casual connection between the basis of classification and the object of the classification. Being fully aware of this test, this Court has considered the facts of the present case and does not appreciate the challenge as made by the petitioners. The factories of the petitioners are mainly situated in the State of U.P and around Delhi. It is not appreciated as to why the petitioners are insisting to get the goods imported through the Port of Calcutta. The petitioners have not been able to demonstrate by giving sufficient data and materials that apart from dry principle of law, there is actually any sufferings of the petitioners or that the petitioners-suffer from the restrictions so challenged. Besides, this Court has also considered the scope of the Policy and the Import Order vis-a-vis the Public Notice whether they are discriminatory in nature in making out a case of unreasonable classification.

    18. True it is that a provision would have to pass the test of reasonableness under clause (5) and first Part of clause (6) of Article 19 of the Constitution of India. That would also be the position in respect of Article 304(b). But since the requirement of these provisions is the same as the yardstick of reasonableness would be common to all these cases. It is well recognised that when an enactment is found to infringe any of the fundamental rights guaranteed under Article 19(1), it must be held to be invalid unless who support it can bring it under the protective provision of clause 5 or clause 6 of that Article. To do so, the burden is on those who seek the protection and not on the citizen to show that the restrictive enactment is invalid as observed by the Hon'ble Supreme Court in case of Vrajlal Manilal & Co. v. State of Madhya Pradesh reported in AIR 1970 SC, Page 129. The facts of the present case are quite distinguishable. Apparently, there is no infringement and the Policy of the Government is very clear that a reasonable restriction has been imposed for checking the abuse of importation of prohibited goods. There is neither total ban of importation of the items of the goods nor there is limited importation of the quantity of the goods. The entry of the goods to the country is permitted and the trading of the goods all through the country and the use and intercourse are also permitted. The only restriction is for the entry of the goods to the country through two specific points viz. Bombay and Delhi ICD. This restriction appears to be reasonable regard being had to-the facts and background of the case and the circumstances leading to check attempts by unfair traders to import the prohibited goods in a surreptitious way. In the case of the Union of India v. D. Damani &. Co. reported in AIR 1980 SC, Page 1149, the Apex Court considered the scope of section 3 of Imports & Exports (Control) Act, 1947 as to export of silver and the total ban vis-a-vis Administrative Policy behind the ban and as to whether it was justiceable in view of Article 19 of the Constitution. The facts of the case where that a dealer in export of silver had entered into agreement with State Trading Corporation for the purpose of exporting silver to foreign buyer and had made all arrangements to perform the contract. In the meanwhile, the Exports (Control) Fifteen (Amendment) Order (1979) came into force which imposed a complete ban on export of silver including pre-ban contracts. The agreement between the dealer and the State Trading Corporation contained an indemnity clause according to which in case the contract with foreign buyer could not be performed the dealer undertook to indemnify the State Trading Corporation. It was held that in the circumstances of the said case even though the contract to export silver related to pre-ban period, the Court would not interfere with the Government Order prohibiting export of silver and even if the foreign buyer claims damages from the State Trading Corporation for breach of contract due to ban of export of silver the State Trading Corporation would not be allowed to enforce the indemnity contract against the exporting policy in view of the equitable considerations. It was made clear that the constitutional questions should be considered by Courts only when it is absolutely necessary and not otherwise. Prima facie, National Export Policy should not be interfered with by Courts unless compelled by glaring unconstitutionality. In order to appreciate the scope of the policy the Hon'ble Supreme Court has given a proper guideline in the case of Gopal Narain v. State of Uttar Pradesh reported in AIR 1964 SC, P. 370 Subba Rao, J. (As His Lordship then was) delivering the judgment has observed that because of a legislature's reluctance or inadvertance to express itself clearly of its policy, a heavy and difficult burden is often placed on Courts to discover it, if possible, on a fair reading of the provisions of the Act. Some Acts expressly lay down the Policy to guide the exercise of discretion of an authority on whom a power to classify is conferred. Some Acts though they do not expressly say so, through their provisions may enact clearly, by necessary implication, their policy affording a real guidance for the exercise of discretion conferred on an authority thereunder. While a Court should be on its guard not to enter into the domain of speculation with a view to cover up an obvious deficiency in a legislature, it may readily be discovered such a Policy, if it is discernible on a fair reading of the provisions of the Act. It is neither possible nor adviseable to lay down precisely how a Court should call out such a Policy from an Act in the absence of express statutory declaration of policy. It would depend upon the provisions of each Act, including the preamble. But what can be paucity is the Policy must appear clearly either expressly or by necessary implications from the provisions of the Statute itself.

    19. A strong argument has been made to distinguish the impact of the conditions as laid down in Open General Licence (OGL) and the Additional Licence. It is highlighted that all the conditions and/or the restrictions are not provided in the Additional Licence and the persons holding the Additional Licence have a larger freedom and if there is no such condition in the Additional Licence, the restrictions sought to be imposed are contrary to law and beyond the original Policy. If there is any attempt to restrict and/or regulate the conditions appearing in the Open General Licence it will not automatically affect the additional licence and the persons having additional licence cannot be restrained to proceed in the proper perspective. This Court has considered this aspect of the case also inasmuch a policy adopted by the appropriate Government must be consistent and the steps to be taken by the Government must be fair and not discriminatory. It has been contended that in the instant case the conditions governing imports under the Open General Licence have been purported to be changed by the Impugned Control Order and/or Public Notice. It is alleged that there has been no corresponding amendment or change in the conditions governing the grant of importation of additional licences which are contained in Chapter XVIII Paragraph 215 of the Import Policy. It is argued that the amendments made in the conditions governing imports under Open General Licence cannot apply to the importation under additional licence. Since the Import Policy by itself has no statutory force the conditions contained in OGL Order No. 1/88 would not apply to importation under the additional licence. According to the petitioners, statutory additional import licence would govern importation of the goods be imported under an additional licence. Upon perusal of paragraph 215 of the Import Policy and looking to the conditions as laid down in the Open General Licence as well as additional licence, it appears that what can be imported under an additional licence are “items” covered under Part-I of List 8 of Appendix 6 of the Import Policy. The conditions are almost same and similar. If there is any change of the condition of any clause it will have impact both upon the Open General Licence as well as upon the additional licence. The policy is always deemed to be consistent. All the relevant statute and the steps taken thereunder have got to be reconciled and upon properly construing the relevant provisions, it does not appear that in the facts of the present case, the persons holding additional licence have a larger freedom to import the goods in question through the ports other than Bombay and Delhi ICD.

    20. The attention of this Court has been drawn to the decision of the Full Bench of the Delhi High Court reported in 1987(29) ELT, Page 753 (Jain Exports Private Limited, New Delhi v. Union of India) which has since been affirmed by the Hon'ble Supreme Court by its decision as reported in (1988) 3 SCC, Page 579. The issue involved in the said case was whether or not coconut oil which has been transferred from the OGL List to the Canalised List could be imported under an Import Licence issued in 1980–81 which was re-validated on June 28, 1982 when the Import Policy of 1982–83 was enforced. It has, however, been found that once a particular item is transferred from OGL list to the Canalised List during the period when the licence has been issued and the goods arrived at the importation in the country, such goods no longer remain importable under Open General Licence and thus can be imported only by the canalising agency. The petitioners have tried to make out that if the item viz. woollen/synthetic rags as contained in List 8, Part-I, Appendix 6 of the Import Policy will have to be taken within the list and placed in the list of the canalised list or any other list of different Import Policy 1988–91 even under an additional licence, the said goods could not have been imported. It is contended that in the instant case, there has been no such change in List 8, Part-I of Appendix 6 of the Import Policy. No restriction has been imposed nor any condition has been laid down to restrict the importation through any Port in the country and whatever restriction has been imposed has been in the conditions governing import under the Open General Licence. In this connection, Paragraph 24 and Paragraph 26 of the Import Policy are relevant. Besides, the Delhi High Court in its Full Bench Judgment has considered that section 3 of the Imports and Exports Act empowers the Central Government to prohibit or restrict imports. An OGL order passed under the said section by which it gives in general to import certain items but subject to certain conditions in effect prohibits the imports of these items unless the conditions mentioned in the said order are complied. Thus notwithstanding that even if during the currency of 1980–81 Import Policy, industrial coconut oil could be imported, the same were prohibited in terms of 1981–82 Policy and 1982–83 Policy at the time of arrival of goods in July/September 1982, as by then these goods were canalised and no longer on Open General Licence. Further, revalidation was in January 1982. Condition No. 18 of OGL Order dated 3.4.1981 provided that shipment of goods should have been received by 31.3.1982 or 30.6.1982 and irrevocable letter of credit opened by 28.2.1982 Since the goods arrived in September, 1982, even in terms of the said conditions, the goods could not have been imported validly. It is clearly held that any argument which assumes a certain vested right to import certain items and denies power to the Union of India to change that policy subsequently must be repelled. Therefore, the submission that there was a vested right in the petitioners to import the items which were in OGL under 1980–81 Policy, even though they may be canalised in subsequent years, that the licence issued in 1980–81 must continue to govern the requirements of import, that the purpose of revalidation is only to extend the period of validity for the shipment and that the arrival date could have no relevance to the items which could be imported are misconceived. It is not for the Court to examine merits and demerits of a Policy laid down by regulation making body. It has been found by the Hon'ble Supreme Court in its decision reported in AIR 1984 SC, P. 1543 (Maharashtra State Board Secondary and Higher Secondary Education v. Paritosh Bhupesh Kurmarsheth). It has been observed that the question whether a particular piece of delegated legislation whether a rule or regulation or other type of statutory instrument—is in excess of the power of subordinate legislation conferred on the delegate has to be with reference only to the specific provisions contained in the relevant statute conferring the power to make the rule, regulation etc. and also the object and purpose of the Act as can be gathered from the various provisions of the enactment. It is exclusively within the province of the legislature and its delegate to determine, as a matter of policy, how the provisions of the Statute can best be implemented and what measures, substantive as well as procedural would have to be incorporated in the rules or regulations for the efficacious achievement of the objects and purposes of the Act. It is not for the Court to examine the merits or demerits of a policy laid down by regulation-making body because its scrutiny has to be limited to the question as to whether the impugned regulations fall within the scope of the regulation-making power conferred on the delegate by the Statute. Any drawbacks in the policy incorporated in a rule or regulation will not render it ultra vires and the Court cannot strike it down on the ground that, in its opinion, it is not a wise or prudent policy, but is even a foolish one, and that it will not really serve to effectuate the purposes of the Act.

    21. It further appears that in affirming decision of the Single Judge of this Court reported in AIR 1975 Cal. Page 440 (supra), the Division Bench of this Court in its Judgment as reported in AIR 1987 Cal. Page 181 has noted that under the current Defence of India Rules, 1971 the Government has been empowered to prohibit or restrict Imports & Exports of goods. Rule 126 specifically provides that the Central Government may be notified order prohibit or restrict the Imports and Exports of all goods or goods of any specified description from or to any specified persons or class of persons. Sub-Rule (3) of Rule 126 further empowers the Central Government to prohibit or restrict or control in all cases or any specified classes of cases and subject to exceptions as may be made, the import or export of all goods or goods of any specified description. It is, therefore, clear that any parallel legislation which is perimeteria of the Act of 1947, a distinction has been made between goods of specified description and all goods. Section 3 of the Act of 1947 itself empowers the Authorities to impose restriction on trade and therefore, should be construed with some strictness. This Court observes that great respect to the Learned Single Judge at Madras while an unreported Judgment dated 25.4.1990 in the matter of B.L Tandon v. Union of India being Writ petition No. 2167 of 1990 in the High Court of Judicature at Madras has been placed on record, that there was perhaps no assistance to the Hon'ble Judge by referring all the facts of the case and the relevant provisions of law to decide the case comprehensively and to examine the extent of the power of the Central Government to formulate a Policy pursuant to relevant provisions of law as prevailing to issue the impugned notification. The issuance of any writ in the said Judgment without considering all the relevant facts and laws cannot have any impact upon the decision of the present cases. Thus having discussed all the facts and laws as connected therein this Court respectfully differs with the conclusion reached by the Hon'ble Single Judge at Madras.

    22. Thus considering all the aspects of the matter and considering the submissions made on behalf of the respective parties, and looking at the facts of the case and the provisions of law involved thereby, this Court is of the view that the steps taken by the respondent authorities and the acts done and/or caused to have been done by the Import Trade (Control) Order, the Public Notice and other consequential steps in pursuance thereof are not contrary to and inconsistent with the provisions as contained in section 3 of the Imports and Exports (Control) Act of 1947 and the Policy to restrict the entry of the goods through two specified Ports does not infringe the rights of the petitioners nor it violates any constitutional provision. The points raised by the petitioners are thus answered in the negative.

    23. For the foregoing reasons, this Court does not find any merit to grant any relief to the petitioner. In the result, the writ petition is dismissed. All interim orders, if any, are vacated. There will be no separate order as to costs. The ratio of this decision squarely applies to other pending writ petitions, and those may be disposed by bringing them in the Daily List for hearing in accordance with law and ensuing procedure.

    24. Upon prayer of the learned Advocates appearing for the petitioner and for the respondents, there will be stay of operation of the order for a fortnight.

    All parties including learned Advocates will act on a Xerox copy of the order on usual undertaking.

    Petition rejected.
    A.R

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    M/S. Kalindi Woollen Mills (P) Ltd. & Anr. v. Union Of India & Ors.
    (Jul 20, 1990)