Holding

No vested right accrues from filing an application; the value‑addition norm applicable is that in force on the date of licence grant, and promissory estoppel does not apply.

Summary

S.B. International Ltd., an exporter of marine products, applied for advance licences under the Duty Exemption Scheme of the Export and Import (Control) Act, 1947 between May and September 1992. On 25 September 1992 the government raised the value‑addition norm from 1000% to 1900% and later issued the licences in February 1993 based on the higher norm. The company claimed that, because its applications were filed before the policy change, it had a vested right to licences governed by the old norm and invoked promissory estoppel, also alleging that the authorities’ delay should not prejudice it. The Calcutta High Court initially granted relief, but the Division Bench gave only partial relief, leading to appeals before the Supreme Court. The Court held that filing an application does not create a vested right; the norm applicable is the one in force on the date the licence is granted, not on the date of application, and the doctrine of promissory estoppel cannot be invoked in these circumstances. Consequently, the appellant was not entitled to licences under the pre‑revision norm.

Issues considered

Whether an application for an advance licence creates a vested right to the licence governed by the value‑addition norm in force at the time of application
Whether a subsequent change in the Export and Import Policy can be applied to pending licence applications
Whether the doctrine of promissory estoppel is available to the applicant
Whether delay by the licensing authority can be treated as ‘taking advantage of its own wrong’

Subjects

advance licenceduty exemption schemevalue addition normvested rightpromissory estoppelExport and Import (Control) Actpolicy changeadministrative discretion

Judgment

A S.B. INTERNATIONAL LTD. ETC.
v.
ASSTT. DIRECTOR GENERAL OF F.T. AND ORS. ETC.

JANUARY 24, 1996

B [B.P. JEEVAN REDDY AND B.N. KIRPAL, JJ.]

Export and Import (Control) Act, 1947

S. 3-Export and Import Policy (1-4-1992 and 31.3.1997}-Duty Ex-
C emption Scheme-Exporters permitted import of Duty free raw material etc.
for purpose of export production subject to value based advance licences or
quantity based advance licences--Company making applications for advance
licences before 25.9.1992--Value addition norms enhanced w.ef 25.9.1992--
Company claiming advance licences in accordance with norms as in force
prior to 25.9.1992---Held, mere making of an application for advance licence
D ·does not create any right in applicant since he has no pre-existing right to such
licence-No vested right accrues to applicant for issuance of advance licence
on the basis of norm prevalent on the date of application-It is the tJeJe of
the licence that is relevant and not the date of application-Value addition
norm in vogue on date of grant of licence shall govern the licence-Grant of
E Licence is neither a mechanical exercise nor a formality-Applications for
grant of advance licences to be disposed of within reasonable time with due
expedition.

Doctrine of promissory estoppel-Applicability of

F The Government of India, with a view to encourage exports, issued
the "Export and Import Policy (lst April, 1992 and 31st March 1997)
introducing "Duty Exemption Scheme" whereunder imports of duty free
raw materials etc. required for the purpose of export production could be
permitted "subject to the fulfilment of a time bound export obligation and
G value addition norms as would be specified". Advance licence for the
purpose could be based on either value or quantity and an exporter could
apply either for a value based advance licence or a quantity based advance
licence.

The appellant (in Civil Appeal No. 2379/96), an exporter of marine
H products, entered into contracts with foreign buyers and accordingly made
910
.-(

S.B. INTERNATIONAL LID. v. ASSTI. DIRECTOR GEN. OFF.T. 911

five applications between 29th May 1992 and 15th September 1992 for A
advance licences. On 25.9.1992 the value addition norm was enhanced to
1900 from 1000 per cent; and licences were issued according to the en-
hanced value addition norm. The appellant-company first represented to
the Government against the enhanced value addition norm, and later filed
a writ petition before the High Court on the ground that since the appel-
B
Ian! had applied for licences prior to September, 25, 1992, its applications

.. ought to be governed by value addition norin in force prior to 25.9.1992 .
The Single Judge of the High Court allowed the writ petition. In the Letters
~ Patent Appeal filed by the Government, the Division Bench of the High
Court held that the appellant would be entitled to advance licences accord-
ing to pre-revised norm with respect to the actual exports effected by it c
before 25.9.1992. Aggrieved, the Company as well as the Government filed
the appeals.

It was contended on behalf of the Company that it was entitled to
advance licences in accordance with the policy in vogue on the date of
application because (i) the Export and the Import Policy being statutory
D
in nature a right accrued to the Company to obtain the licences in
accordance with the policy in vogue on the date of application therefor;
and (ii) issuance of licences was delayed by the authorities and they could
.....,,, not take advantage of their own wrong and apply the revised norms to the
prejudice of the Company. A plea of promissory estoppel was also raised E
on behalf of the Company.

Dismissing the appeal of the Company and allowing that of the
Government, this Court
F
HELD: 1.1. Mere making of an application for advance licence does
not create any right in the applicant since he has no pre-existing right to
such licence. His right is only that given by the policy. Under the "Duty
Exemption Scheme' one has to ask for an import licence promising to
export goods of a particular value within a particular time. In view of the
Scheme and the context a vested right does not accrue to an applicant lbr
G
A
' ..
-t issuance of advance licence on the basis of norm obtaining on the date of
"
application. (918-C-D, G]

1.2. It is the date of licence that is relevant and not the date of
application therefor. It is obvious that the value addition norm in vogue H
912 SUPREME COURT REPORTS [1996] 1 S.C.R.

A on the date of grant of licence shall govern the licence. The mere fact that ...
the authorities have a discretion to take into account the exports made ..
after the date of application for advance licences makes no difference to
this position; it is in the nature of yet another concession. What is relevant
is that the licence granted under Chapter-VII of the Policy is an advance
B licence. It is granted in advance of export-rather to enable the export. The
theory of a vested right accruing to the applicant to get a licence as per
norms in force on the date of application is inconceivable in such a
situation - unless, of course, the Policy itself says so. [918-E-G]

1.3. The object behind the Scheme is to enable the exporter to import
C raw materials, component etc. required for the purpose of producing goods
for export. It is a facility provided by the Government - an incentive. There
is no right to advance licence apart from the Policy. No citizen has a
fundamental right to import, much less import free of duty. By granting the
advance licence, the licensee is permitted to import raw material, com-
D ponents etc. or a particular value free of duties in order to export goods of
a particular value, determined as per value additional norms in vogue on
the date of licence, within a particular period. The facility is extended to the
exporter to sell his goods abroad at a more competitive price and fetch
precious foreign exchange for the country. [917-H, 918-A-C)

E 1.4. The fact that the policy is statutory in nature (delegated legisla-
tion) has no relevance on the question at issde. It would be wrong to equate
the filing of an application for advance licence with the filing of a suit
where a substantive right of appeal inheres in the party on the date of filing
of the suit. [919-B·CJ
F
Pankaj Jain Agencies v. Unit of India, [1994) 5 S.C.C. 198; Deputy
Assistant Iron and Steel Controller v. L. Manickchand, Proprietor, Katrella
Metal Corporation, Madras, [1972) 3 S.C.C. 324 and Andhra Industrial
Works v. Chief Controller of Exports; [1975) 1 S.C.R. 321, relied on.

G 2. Having regard to the nature of the advance licence-import first
and export later-there is no room for the plea of promissory estoppel. The
discretion inhering in the authority to take into consideration the exports
effected after the date of filing of the application for advance licence does
not detract from its essential character. Besides, no precise data has been
I
H furnished by the appellant in support of the said plea. In the absence of
S.B. INTERNATIONAL LTD. v. ASSTI. DIRECTOR GEN. OF F.T. 913

such data, the plea of promissory estoppel is mis-conceived. lt is not a A
pure question ofla\v. The appellant has to establish the various ingredients
of the rule. (919-D-F]

Motilal Padampat Sugar Mills Co. Ltd. v. State of Uttar Pradesh, (1979]
2 S.C.R. 641, relied on.
B
D. Navinchandra & Co. Bombay & Anr. v. Union of India & Ors.,
(1987] 2 S.C.R. 898, Collector of Customs~ Calcutta v. M/s.M. Shashikant &
Co., (1992] 2 Supp. S.C.C. 306 and Kasinka Trading v. Union of India,
(1995] I S.C.C. 274, referred to.
c
3.1. Grant of licence is ne\ther a mechanical exercise nor a formality.
On receipt of the application, "the authorities have to satisfy themselves
that the contents of the application are correct and that the application
I
satisfies all the re11uirements of the Scheme and other relevant provisions
of law. Therefore, reasonable time, depending on the facts of each case, D
_,->r has to be afforded to the authorities to process the applications. It is only
after appropriate verification that the licence is granted. (918-G-H, 919-A]

3.2. In the instant case the appl_ications for advance licences were
made on 29th May, 18th June, 24th June and 15th September 1992. The E
application of 15th September 1992 relates to two contracts of much higher
value. The change in policy was effected on St>ptember 25, 1992, i.e. within
a few days of the last application. TI1ese applications have to be disposed
of within a reasonable· time-indeed with due expedition. But there is no
allegation/averment in the writ petition that the authorities have
F
deliberately deleted the issuance of advancelticences. Nor is there any
finding by the High Court to this effect. In such a situation, the mere fact
that the appellant is likely to suffer some some loss or prejudice-assuming
that the said plea is factually true-cannot be a ground either for invoking
the rule of promissory estoppel or to otherwise bind the Government to
apply and adopt the value addition norm in force on the date of applica· G
tion. (919-H, 920-A-C]

Deputy Assistant Iron and Steel Controller v. L. Manickchand
Propriet01; Kao-el/a Metal C01poration, Madras, (1972] 3 S.C.C. 324, relied
on. H
914 SUPREME COURT REPORTS [1996] 1 S.C.R.

A CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2379 of
1996.

From the Judgment and Order dated 6.9.94 of the Calcutta High
Court in Appeal No. Nil of 1994.

B WITH

Civil Appeal No. 2380 of 1996.

From the Judgment and Order dated 6.9.94 of the Calcutta High
Court in Appeal Matter No. 3152 of 1993.
c
P.V. Kapoor, Krishnendu Datta and Rajiv Dutta for the Appellants.

A. Subba Rao and Ms. Sushma Suri for the Respondents.

The Judgment of the Court was delivered by
D
B.P. JEEVAN REDDY, J. Leave granted.

With a view to encourage exports, the Government of India issued
the ''Export and Import Policy (!st April, 1992 and 31st March, 1977)"
introducing inter alia a scheme called "Duty Exemption Scheme" contained
E in Chapter-VII. Under this sehen.e, imports of duty free raw materials,
components, . intermediates, consumables, parts, spares including man-
datory spares and packing materials required for the purpose of export
production could be permitted "subject to the fulfilment of a time bound
export obligation and value addition as may be specified". Advance licences
F could be based on either value or quantity; if was for the exporter to apply
either for a value based advance licence or a quantity-based advance
licences (vide Clauses 47 and 48). Clause 49 in Chapter-Ill sets oat the
particulars to be mentioned in the advance licence. One of the particulars
to be mentioned is "(d) the value addition in accordance with the standard
Input-Output norms published by means of a Public Notice or, in respect
G of items for which· such norms have not been published, value addition as
may be specified by the competent authority." Clause 52 expressly provides
that "the Chief Controller of Imports and Exports may, on the recommen-
dation of the Advance Licencing Committee (ALC) modify the norms or
prescribe additional norms." Clause 59 prescribes the eligibility for apply-
H ing for an advance licence. It says, 11 any merchant exporter or manufactun~r
-(
S.B. INTERNATIONAL LTD.•·. ASSTI'. DIRECTOR GEN. OF F.T. [B.P.JEEVAN REDDYJ.) 915

exporter who holds an Importer-Exporter Code number, a speci[ic export A
J order/letter of credit and is in a position to realise the export proceeds in
his own name may apply for duty free licences." Clause 60 prescribes that
11
value addition norms, as specified by means of a Public Notice issued in
this behalf, shall apply to duty free licences". Clause 63 provides that a
licence issued under the said scheme shall specify the export obligation
B
which has to be fulfilled within the period specified therein. Clauses 66
provides that "Exports/supplies made from the date of receipt of an ap-
plication under this scheme by the licensing authority may be accepted
towards discharge of export obligation ....... ". (Clause 66 has been amended
later in 1993 and 1994. We are, however, concerned with the unamended
Clause 66.) c
On 31st March, 1992, a public notice was issued, as contemplated by
Clauses 49 (d) and 60 specifying the value addition at 1000 percent in the
case of "frozen marine products packed in pol)1hene bags". On September
25, 1992, a change was effected in the value addition norm - instead of 1000 D
percent, it become 1900 percent.

The appellant (we shall be referring to S.B. International Limited as
the appellant and the Assistant Director General of Foreign Trade and
Union of India as respondents) is engaged in the export of marine
products. It entered into six contracts with certain foreign buyers to supply E
marine products. These contracts were entered into on 27th May, 4th June,
10th June, 22nd June, 26th June and 27th June, 1992. In respect of these
export commitments, the appellant made five applications for advance
licences, i.e., on 29th May, 18th June, 24th June, 24th June and 15th
September, 1992. (The last mentioned application, we are told, was in F
respect of Contract 5 and 6 mentioned above. We are also told that the
value of the last two contracts is very substantial as compared to the value
of the first four contracts.) The appellant says that by September 25, 1992,
the export obligation concerned in the first three applications was fully
discharged whereas in respect of the fourth application, it was fulfilled to G
the extent of 81 % and in the case of the last mentio.ned application, it was
fulfilled to the extent of 21 %. The advance licences were not issued by
September 25, 1992. On that date, a change was effected, as aforesaid, in
the value addition norms, enhancing the value addition norm to 1900
percent from 1000 percent. Licences were issued according to this en-
hanced value addition norm in February, 1993. The appellant protested H
916 SUPREME COURT REPORTS [1996] 1 S.C.R.

A against application of revised/enhanced value addition norm on the ground
that since it had applied for advance licences prior to September 25, 1992,
the change brought about on and with effect from the said date has no
application and that it applications ought to be governed by the value
addition norm in force prior to September 25, 1992. Finding no· response
B from the authorities, it approached the Calcutta High Court by way of a
writ petition.

A learned Single Judge allowed the writ petition (Matter No. 3152
of 1993) upholding the contention of the appellant. The respondents
preferred a letters Patent Appeal against the decision of the learned Single
C Judge. The Division Bench dismissed the appeal but with a small alterna-
tion in the relief granted. The Division Bench held that the appellant shall
be entitled to advance licences according to pre-revised norm with respect
to the actual exports effected by it before September 25, 1992 but not for
the exports effected thereafter. Aggrieved by the decision of Division
D Bench, both the appellant and the State have filed these appeals, insofar
as it went against them. The only question in the appeals is whether the
appellant is entitled to advance licences on the basis of the value addition
norm obtaining prior to September 25, 1992 on the ground that it had
applied therefor prior to the said date.

E Sri P.V. Kapoor, learned counsel for the appellant, submitted that
the Export and Import Policy devising the Duty Exemption Scheme is
statutory in nature, having been issued under Section 3 of the Export and
Import (Control) Act, 1947. Applications for advance licences can be filed
under this Scheme even before effecting the exports, subject, of course, to
F the obligation to effect the exports in the prescribed value. Once the
appellant made applications for issue of advance licences, a right accrued
to it to obtain the lieence in accordance with the policy in vogue on that
date. Any subsequent change. in the policy cannot defeat such a vested
right. Learned counsel also relied upon the rule of promissory estoppel.
He submitted that the appellant had entered into export commitments at r
G a particular price keeping in view the Export and Import Policy in vogue l
on that date; the appellant knew that as against the export commitments
+
undertaken by him, he would be entitled to duty free advance licences of
a particular value; the price agreed between him and the foreign buyer was
arrived at bearing the said consideration in mind; if the Government is
H permitted to suddenly change the value addition norm to the prejudice of
S.B. INTERNATIONAL LTD. v. ASSIT. DIRECTOR GEN. OF F.T. [B.P. JEEVAN REDDY. J. J 917

the appellant, it would suffer grievous losses - submitted the learned A
)
counsel. Yet another submission urged by the learned counsel is that the
authorities cannot take advantage of their own wrong, viz., the delay in
issuing the advance licences. If they had issued the licences applied for
prior to September 25, 1992, the appellant would have obtained licences
of a higher value in accordance with the then existing value addition norm.
B
Merely because the authorities have delayed the issuance of licences, they
cannot apply the revised norm to the prejudice of the appellant, especially
when the appellant is in no way responsible for the said delay. Sri Kapoor
submitted that the appellant should be held entitled to advance licences
not merely for the actual e'11orts effected by it before September 25, 1992
but for the whole value of the export contracts entered into by it. He c
submitted that the appellant has since discharged the export obligation
under the said six contracts fully.

Sri A. Subba Rao, learned counsel for the Union of India, on the
other hand, submitted that mere filing of an application does not confer D
any right much less a vested right upon the applicant for the issuance of
an advance licence. He submitted that no one has a fundamental right to
import and that the said right depends upon the policy for the time being
in force. The policy in vogue on the date of issue of licences alone governs
the licences. Learned counsel further submitted that there is no allegation
much less any finding either by the learned Single Judge or by the Division E
Bench that the authorities are guilty of any deliberate or undue delay in
issuing the licences. The issuance of these licences is not a mechanical or
a formal matter. The authorities have to verify the correctness of the
various facts stated in the application and also have to satisfy themselves
that the applicant satisfies the requirements of the Scheme and other F
applicable provisions of law before the licences are issued.

The first question in these appeals is whether a vested right accrued
to the appellant for issuance of advance licences as per the value addition
norm in vogue on the date of filing of the said application the moment it G
made those applications and whether any subsequent change in policy
effected before the issuance of licences, is not applicable to such licences.
For answering this question, one has to look to the Policy itself, the
material clauses of which have already been set out. The said provisions
make it clear that the object behind the scheme is to enable the exporter
to import raw materials, components etc. required for the purpose of H
918 SUPREME COURT REPORTS (1996] 1 S.C.R.

A producing good for export. It is a facility provided by the Government - an
incentive. There is no right to advance licence apart from the Policy. No
citizen has a fundamental right lo import, much less import free of duty.
By granting the advance licence, the licencing authority tells the licencee -
"I am permitting you to import raw material, components etc. of a par-
ticular value free of duties but you must export goods of a particular value
B (determined as per value addition 11orm in vogue on the date of licence)
within a particular date. If you fail to do so, you will be liable to levy of
penalties and other action according to law." The duty free import of raw
materials etc. is permitted to enable the exporter to sell his goods abroad ...
at a more competitive price, thereby fetching precious foreign exchange for
C the country. Mere making of an application does not create any right in
the applicant since he has no pre-existing right to such licence. His right
is only that which is given by the Policy. The situation could have been
different if the Policy had said that a person exporting goods of a particular
value shall be entitled to an import licence of a particular value; in such a
D case, the export of goods can be said to create a right in the applicant to
get an import licence of the specified value. Herc is a case, where one has
to ask for an import licence promising to export goods of a particular value
within a particular time. It is difficult to appreciate how can it be said in
such a situation that mere filing of an application creates a vested legal
right to obtain a licence according lo the value addition norm in vogue on
E the date of the application. It is the date of licence that is relevant and not
the date of application therefor. It is obvious that the norm (value addition
norm) in vogue on the date of grant of licence shall govern the licence. The
mere fact that the authorities have a discretion to take into account the
exports made after the date of application for advance licences makes no
F difference to this position; it is in the nature of yet another concession.
What is relevant is that the licence granted under Chapter-VII of the Policy
is an advance licence. It is granted in advance of export - rather to enable
the export. The theory of a vested right accruing to the applicant to get a
licence as per the norm in force on the date of application is inconceivable
in such a situation - unless, of course, the Policy itself says so.
G
It should be noticed that grant of licence is neither a mechanical +
exercise nor a formality. On receipt of the application, the authorities have
to satisfy themselves about the correctness of the contents of the applica-
tion. They also have to satisfy themselves that the application satisfies all
H the requirements of the scheme and the other applicable provisions of law,
S.B. JNTERNATJONALLTD. v. ASSTI'.D!RECTOR GEN. OF F.T. (B.P.JEEVANREODY,J.j 919

if any. In a country like ours, where abuse of such facilities is rampant, A
)
reasonable time has to be afforded to the authorities to process the
application. (What is a reasonable time, of course, depends on the facts of
each case. No hard and fast limit can be prescribed.) It is only after
appropriate verification that the licence is granted.

We are, therefore, of the opinion that the contention that a vested B
right accrues to an applicant for issuance of advance licence on the basis
of the norm obtaining on the date of application is unacceptable. The
Scheme and the context militate against the contention. The fact that the
policy is statutory in nature (delegated legislation) has no relevance on the
question at issue. It would be wrong to equate the filing of an application c
for advance licence with the filing of a suit where it is held that appeal
being a substantive right, the right of appeal inhering in the party on the
date of filing of the suit cannot be taken away by a subsequent change in
law.
D
So far as the argument of promissory estoppel is concerned, it is
equally unsustainable in the facts and circumstances of the case. Having
regard to the nature of the advance licence - import first and export later
- there is no room for this argument. The discretion inhering in the
authority to take into consideration the exports effected after the date of
filing of the application for advance licence does not detract from its E
essential character, as explained hereinabove. We may also mention that
no precise data has been furnished by the appellant in support of the said
plea. In the absence of such data, the plea of promissory estoppel is
misconceived. The appellant has to establish the various ingredients of this
rule, as enumerated by this Court in Moti/al Padampat Sugar Mills Co. Ltd. F
v. State of Uttar Pradesh, [1979] 2 S.C.R. 641 and other subsequent
decisions. It is not a pure question of law.

Now, coming to the argument of the authorities taking advantage of
their own wrong, viz., delay in issuing the advance licences, it may be G
noticed that there is no allegation/averment in the writ petition that the
authorities have deliberately delayed the issuance of the advance licences.
We have mentioned hereinbefore that issuance of these licences is not a
formality nor a mere ministerial function but that it requires due verifica-
tion and formation of satisfaction as to compliance with all the relevant
provisions. In this case, the applications for advance licences were made H
920 SUPREMECOURTREPORTS [1996] 1 S. C.R.

A on 29th May, 18th June, 24th June (two applications) and 15th September,
1992. The application of 15th September, 1992 relates to two contracts of
much higher value. The change in policy was on September 25, 1992, i.e.,
within a few days of the last application. Without a doubt, these applica-
tions have to be disposed of within a reasonable time - indeed with due
B expedition. But in the absence of any plea in this behalf, it is not possible
to hold that there has been any undue delay, procrastination or deliberate-
ness on the part of the authorities in issuing the licences. There is no
finding either by the learned Single Judge or the Division Bench to this
effect. In such a situation, the mere fact that the appellant is likely to suffer
some loss or prejudice - assuming that the said plea is factually true -
C cannot be ground either for invoking the rule of promissory estoppel or to
otherwise bind the Government to apply and adopt the value addition norm
in force on the date of application. In this context, the observations of this
Court in Pankaj Jain Agencies v. Union of India, [1994] 5 S.C.C. 198 are
apposite. M.N. Venkatachaliah, CJ., speaking for the Court, held:

D "The third and the last submission is that the sudden and sharp
increase of duty steeply puts up the petitioner's liability from
Rs.l,84,341 to Rs. 6,42,065 on these consignments and constitutes
an unreasonable restriction on the peti'tioner's fundamental rights
under Article 19(1)(g) of the Constitution. A tax, in particular, in
E the nature of duties of customs is not per se violative of Article
19(1)(g). Mere excessiveness of a tax is not, by itself, violative of
Article 19(1)(g). This question cannot be divorced from the nature
of the right to import. There is no absolute right much less a
fundamental right to import. (See : Deputy Assistant Iron and Steel
Control/er v. L. Manickchand, Propriet01; Katrella Metal Corpn.,
F Madras, [1972] 3 S.C.C. 324 and Andhra Industlial Works v. Chief :
Controller of Imp01ts, [1974] 2 S.C.C. 348; J. Femandes & Co. v.
Deputy Chief Controller of Imp01ts and Expo1ts, [1975] 1 S.C.C. 716.
That apart, no factual foundations are laid to demonstrate how
this impost has had the effect of destroying the petitioner's right
to carry on a trade or business. This contention also has no merit."
G
Sri A. Subba Rao, learned counsel for the Union of India, brought
to our notice certain decisions to which a brief reference would be in order.
In Deputy Assistant Iron and Still Controller v. L. Manickchand, Proprietor,
Katrel/a Metal Corporation, Madras, [1972] 3 S.C.C. 324, the respondent
H applied for an import licence in December, 1968 for importing stainless
S.B. JNTERNATIONAL LID.~·. ASSTI. DIRECTOR GEN. OF F.T. [B.P. JEEVAN REDDY, J.] 921

steel for the licensing period 1968-69. His registration certificate showed A
that he was engaged in the manufacture of hospital and surgical instru-
ments and household utensils of stainless steel. In view of the large number
of applications for import licences for stainless steel, instructions were
issued in January, 1969 that applications should be scrutinised carefully
after asking for relevant information from the applicants as to the details B
of end products to be manufactured by them. the respondent supplied
information in May, 1969 that the hospital requisites proposed to be
manufactured by him were surgical bowls, spittoons and trays. The Chief
Controller, Exports and Imports, however, issued instructions that only
"medical and surgical equipment and appliances" should have priority and
not other types of hospital equipment, such as bowls, trays, jugs, etc. In c
April 1970, the Chief Controller issued instructions to consider the
respondent's application in terms of the Licencing Policy of 1970-71. The
respondent thereupon filed a writ petition in the High Court contending
that his application having been filed when the 1968-69 Import Policy was
in vogue should be considered in accordance with that Import Policy alone D
and not in the light of or under the Import Licensing Policy in vogue in
1970-71. The High Court allowed the writ petition but was reversed by this
Court on appeal. This Court held, "no case has been made out on the
present record for a mandamus to the department to consider the
respondent's application for import licence in terms of 1968-69 policy. It E
is not possible on the existing material to conclude that the department is
guil.ty of any undue !aches or delay in dealing with the respondent's
application which would justify the Court in granting the mandamus prayed
for. " It was also held that keeping the respondent's application pending
until completion of its examination in the light of policy in vogue cannot
F
be said to be unreasonable nor can the time taken in that behalf be
characterised as undue delay. Above all, it was held, while emphasising the
necessity of disposing of such applications with due expedition, that "an
applicant has not absolute vested right to an import licence in terms of the
policy in force at the time of his application because from the very nature
of things at the time of granting the licence the authority concerned may G
often be in a better position to have a clearer over-all picture of the various
factors having an important impact on the final decision of the allotment
of import quota to the various applicant". This decision rendered by a
Bench of four learned Judges of this Court clearly negatives the contention
of a vested right urged by Sri Kapoor. H
922 SUPREME COURT REPORTS [1996] 1 S.C.R.

A The proposition in Manickchand was reiterated by a Constitution
Bench in Andhra Indust1ial Works v. Chief Controller of Exports, (1975] 1
S.C.R. 321. While observing that the Import Control Policy statement
contained in what was known as "Red Book" was not statutory, the Court
observed, "no person can merely on the basis of such a Statement claim a
right to the grant of an import licence, enforceable at law. Moreover, such
B
a Policy can be changed, rescinded, altered by mere administrative orders
or executive instructions issued at any time". The Court held further :

"From the counter-affidavit filed on behalf of the Respondents, it
is clear that the Import Trade Control Policy (Red Book-Vol. I)
c had been amended and the import of the materials in question for
utilization in the end products of most 'automobile parts' was
prohibited as per instructions conveyed by Chief Controller of
Imports & Exports in his letter No. !PC (Gen. 33)/73/72/3499,
dated September 29, 1972 although general notice of this amend-
ment was published later on August 18, 1973 (Vide Annexure R-5).
D
The result was that in accordance with the amended Import Trade
Control Policy, the Respondent could not, in November, 1972,
grant the licences applied for to the petitioners in respect of the
past period, April 1969-March 1970."

E The Court reiterated the proposition in Manickchand that "on the
basis of an Impo. t Trade Policy an applicant has no absolute right, much
less a fundamental right to the grant of an import licence". It is true that
both decisions in Manickchand and Andhra Industrial Works dealt with the "
Import P_olicy which was not statutory in nature but as explained by us
F hcreinabove because of the very nature and contents of the scheme, the
theory of a vested right is misconceived and put of place.

On the question of promissory estoppel, Sri Subba Rao cited the
decisions in D. Navinchandra & Co., Bombay & Anr. v. Union of India &
Ors., [1987] 2 S.C.R. 989, Collector of Customs, Calcutta v. M/s. M.
G Shashikant & Co., [1992] Supp. S.C.C. 306 and Kasinka Trading v. Union
of India, [1995] 1 S.C.C. 274. On the basis of these decisions, the learned
counsel submitted that any change in policy or rate of duty between the
date of placing the order for import and the actual import applies to the
imported goods and that the theory of promissory estoppel cannot be
H invoked in such a situation. We do not think it necessary to dilate upon
S.B. JNTERNATIONALLTD."· ASSIT. DIRECTOR GEN. OF F.T. [B.P. JEEVAN REDDY, J.] 923

these decisions in view of our holding that in the light of the Scheme A
concerned herein, there is no room for any such plea. For the same reason,
it is also not necessary for us to deal with the decision in Union of India v.
Kanwzga Indusllies, J.T. (1990) 3 S.C.723 relied upon by the learned
counsel for the appellant.

Accordingly, the appeal arising from Special Leave Petition (C) No. B
607 of 1995 (preferred by the appellant) is dismissed and the appeal arising
• from Special Leave Petition (C) No. 23900 of 1995 (preferred by the
respondents-authorities) is allowed. No costs.

R.P. Appeal dismissed and Govt. appeal allowed.
c