SEIS benefits can’t be denied to exporters merely for not having IEC registration: HC

Case Details: Smarte Solutions (P.) Ltd. v. Union of India - [2022] 141 taxmann.com 60 (Bombay)

Judiciary and Counsel Details

• • S.V. Gangapurwala & Vinay Joshi, JJ.
  • Ms Meetika Baghul, Ms Anveshika Singh & Ms Sharon Patole, Advs. for the Petitioner.
  • Ms Shehnaz V. Bharucha, Ms Priyanka Chavan & A.A. Ansari, Advs. for the Respondent.

Facts of the Case

The petitioner exported the services but it did not have a valid IEC number. However while applying for the reward/benefit under the scheme, it had obtained an IEC number and applied accordingly. The benefit was denied to the petitioner on the ground that the eligibility criteria of Clause 3.08(f) of the FTP has imposed additional restriction of having IEC number at the time of rendering services. The petitioner filed writ petition against the same.

High Court Held

The Honorable High Court observed that the proviso to section 7 of the Foreign Trade (Development and Regulation) Act, 1992 does not lay down that the IEC number is essential at the time of rending services. The requirement of IEC number would be only for taking benefits under the scheme. Therefore, it would be abundant clear that the eligibility criteria of Clause 3.08(f) of the FTP has imposed additional restriction of having IEC number at the time of rendering services which was not intent or purport of the statute. Therefore, the said condition was against the principal legislation and therefore, it can’t be termed as of mandatory nature for availing benefits under the scheme. Thus, the petition was allowed and the Court directed to consider the petitioner’s application without insisting for an active IEC number at the time of rendering services.