The Bombay High Court held that suspension and cancellation of importer exporter code number can be done only under Foreign Trade (Development and Regulation) Act, 1992 by the Director General of Foreign Trade (DGFT) or by his authorized officer for the reasons specified and in the manner provided in section 8 of the said Act.
The petitioner, Siddharth Mandavia is the sole proprietor of the proprietorship firm M/s. XS Components which is engaged in the business of export of various products, such as, garments, footwear, leather accessories etc. Petitioner holds Importer Exporter Code.
The importer exporter code of the petitioner, was blocked by the respondent authority. Because of continuing blockage of the importer exporter code, petitioner could not receive drawback incentives to the tune of Rs.8,51,374, Integrated Goods and Service Tax (IGST) refund of Rs.58,00,601 and Merchandise Export Incentive Scheme (MEIS) refund of Rs.45,98,702. Further, because of such blockage, many export orders received by the petitioner from overseas buyers had to be cancelled.
The petitioner prayed before the court to direct the respondent authority to unblock the importer exporter code along with other directions.
The division bench of Justice Ujjal Bhuyan and Abhay Ahuja noticed that the respondent authority which cancelled or suspended the importer exporter code number was neither the DGFT nor his authorized officer
The Court held that there is no provision for blocking importer exporter code, that too by an authority which is not competent either to suspend or cancel such code.
Therefore, the court directed the respondent authority to withdraw the Blockage of importer exporter code of the petitioner.
The court while unfreezing a few bank accounts said that in so far the other accounts are concerned, petitioner may file objection before the Principal Additional Director General of GST Intelligence within a period of 7 days.
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