The High Court of Delhi held that the powers exercised by the Director-General of Foreign Trade (DGFT) while issuing the public notice, which puts restrictions upon the issuance of the advance authorization for the Gold Medallions and Coins is beyond the power, jurisdiction, and authority of DGFT.
The Petitioner, M.D. Overseas Limited is an incorporated company engaged in diverse businesses including the manufacture and export of Gold Jewellery and Gold Medallions, for which, the Petitioner regularly imports Gold bars.
The Petitioner through its application had sought Advance Authorization under the Foreign Trade Policy (FTP) seeking for import of Gold Bars and export of Gold Medallions & Coins. The DGFT issued a deficiency letter pertaining to the application on 2, which the Petitioner replied to, through a letter. Another deficiency letter was issued by DGFT directing the Petitioner to clarify if the Petitioner had achieved the prescribed value addition, in response to which the Petitioner sent a clarificatory letter.
The Petitioner preferred another application for Advance Authorization for the import of Gold Bars and export of Jewellery/Articles manufactured by a fully mechanized process. Thereafter, DGFT, through the impugned Public Notice, disallowed the issue of Advance Authorization for two export items namely “Gold Medallions and Coins” or “Any Jewellery manufactured by fully mechanized process”.
The division judge bench headed by Chief Justice and C. Hari Shankar held that the Director-General of Foreign Trade (DGFT) while issuing the public notice, which puts restrictions upon the issuance of the advance authorization for the Gold Medallions and Coins is beyond the power, jurisdiction, and authority of DGFT.
The court further noted that categorization or re-categorization cannot be done by the policy circulars, such exercise has to be undertaken by a specific amendment to the Foreign Trade Policy under Section 5 of the Act.
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