The union cabinet has approved the implementation of Supreme Court's Judgment regarding Target Plus Scheme (TPS) under Foreign Trade Policy (FTP) 2004-09, which would have a Rs2,700 crore revenue implication on the central government.
The union cabinet chaired by Prime Minister Narendra Modi approved the implementation of a 27 October 2015 order of the Supreme Court regarding Target Plus Scheme (TPS) 2004-09 on civil petition filed in 2006.
The government said the benefit is being extended to all the applicant exporters eligible as per provisions of the initially notified TPS Scheme under FTP for the year 2005-06, and as per provisions of Foreign Trade Policy 2004-09 throughout the country.
The Target Plus Scheme (TPS) 2005-06 was already implemented partially. However, the claims which were denied as a result of retrospective notification will be now settled as per direction of the Supreme Court. The government had discontinued the scheme with effect from 1 April 2006.
All eligible claims will be considered as per original notifications till the date of the 12 August 2006 notification, an official release said. The guidelines and modalities for processing the claims will be worked out by the DGFT in consultation with the Department. of Revenue and is proposed to be completed in one year from the date of approval of the cabinet.
The corrective measure will bring an end to multiple litigations with the government and the claims under the TPS will be issued as per original provisions under Foreign Trade Policy in compliance with the decision of the Supreme Court.
The Supreme Court directive comes on a civil appeal filed by Kanak Exports & Others against DGFT through its judgment dated 27 October 2015 verdict on the Target Plus Scheme for Export Promotion.
The apex court held that the notificationdated 20 February 2006 (which made certain products ineligible) and notification dated 12 June 2006 (wherein rates were reduced to 5 per cent from the earlier 5, 10 and 15 per cent) related to the Target Plus Scheme (TPS) could not be applied retrospectively and they would be effective only from the date of their issue.