S. C. Agrawal, J. - (1.) These petitions under Article 32 of the Constitution raise a common question as to the validity of sub-para (10) of para 218 of the Import and Export Policy for the period April 1988 to March 1991.
(2.) The petitioners in both these writ petitions are partnership firms carrying on business of import of rough diamonds and export of cut and polished diamonds. The Import and Export Policy for the period April 1978 to March 1979, in para 174, made provision for grant of certain import facilities to Export Houses which were registered in accordance with the provisions of the said Policy. One of the said facilities was grant of an Additional licence in terms of para 176 of the said Policy for an amount to be calculated at one third the f.o.b. value of the exports of select products made by the Export House in the year 1977-78. The petitioners submitted application for registration as Export Houses and for grant of Export House Certificate which would have entitled them to the grant of such Additional licence. The said applications of the petitioners were rejected by the authorities on the view that petitioners had failed to diversify their export of "Other Products" during the year 1977-78. The said order refusing the Export Certificate was challenged by the petitioners by filing writ petitions under Article 226 of the Constitution before the Bombay High Court. One of those writ petitions (filed by the petitioners in writ petition No. 460 of 1988 herein) was dismissed by a learned single Judge of the High Court and the said petitioners filed an appeal before a Division Bench of the High Court. While the said appeal and the other writ petition (filed by the petitioners viz. writ petition No. 459 of 1988 herein) were pending in the Bombay High Court, this Court decided Civil Appeal No. 1423 of 1984, Union of India vs. Rajnikant Brothers, connected matters by order dated April 18,1985 reported in (1986) Suppl. SCC 692, wherein it was observed that there was no requirement of diversification of exports as a condition for the grant of Export House Certificates in the Import Policy for the year 1978-79, and the authorities were directed to issue necessary Export Certificates for the year 1978-79. In that order this Court laid down the following condition :- "Save and except items which are specifically banned under the prevalent import policy at the time of import, the respondents shall be entitled to import all other items whether canalised or otherwise in accordance with the relevant rules." The writ petition and the appeal were decided by the Bombay High Court in accordance with the aforesaid decision of this Court in the case of Union of India vs. Rajnikant Brothers (supra) and the High Court directed the authorities to grant Export House Certificates to the petitioners under the Import-Policy 1978-79 within three months. While giving the said direction the High Court imposed a condition in the same terms as laid down by this Court in its order dated April 18,1985, referred to above.
(3.) While construing the aforesaid direction contained in its order dated April 18, 1985, in Rajnikant Brothers case (supra) this Court has held that the grantees of the Additional licences were not only prohibited from importing items which were excluded under the Export Policy 1978-79 but also from importing items excluded under the Import Policy prevailing at the time of import and that the word "banned" was intended to take in terms (item ) which were banned altogether as well as items which were banned for import by the holder of an Additional licence. (See Raj Prakash Chemicals Ltd. vs. Union of India (1986) 1 SCR 448. In Union of India vs. M/s. Godrej Soaps Pvt. Ltd. (1986) 3 SCR 771 this Court construed the words whether canalised or otherwise contained in the order dated April 18, 1985, passed in Rajni kant Brothers case (supra) and it was observed that the Court would not know whether in the future certain canalised items could be imported directly by an Export House holding an Additional licence and that the possibility of a policy being framed in the future enabling an Export House holding an Additional licence to directly import items which are non-canalised and also items which are canalised could not be ruled out and it was in this light that the Court can be said to have used the words "whether canalised or otherwise" in the order dated April 18, 1985. The matter was further clarified by this court in D. Navinchandra and Co., Bombay vs. Union of India (1987) 2 SCR 989, wherein this Court has observed : "Analysing the said order, it is apparent, (1) that the importation that was permissible was of goods which were not specifically banned, (2) such banning must be under the prevalent import policy at the time of import, and (3) whether items which were canalised or uncanalised would be imported in accordance with the relevant rules. These conditions had to be fulfilled. The Court never did and could not have said that canalised items could be imported in any manner not permitted nor it could have given a go-by to canalisation policy. "(p. 1000) ;