SC upholds HC order vacating ban on import of natural rubber

By Nisha Das | 05 Jun 2003

Mumbai: The Supreme Court has upheld the Bombay high court order vacating the ban on the import of natural rubber under the advance licence scheme (ALS).

Dismissing a special leave petition filed by the centre challenging the Bombay HC order, a two-member bench comprising Justice Santosh Hegde and Justice B P Singh said the government cannot approach the court to change its own policies. When additional solicitor general Harish Salve pleaded that the issue involved over 10 lakh small growers, the judges said that do not expect the court to come to the government's rescue.

The Bombay HC, on a petition filed by Naresh Udeshi, an exporter of rubber products, ruled that the ban imposed by the directorate-general of foreign trade (DGFT) on duty-free import of natural rubber through ALS was null and void.

Anil Sampat, president, All India Rubber Industries Association, says the high court had said that the DGFT has no powers to ban imports either through notifications or circulars. The court in its ruling in last September had questioned the DGFT's decision particularly when the government had allowed duty-free import under ALS on 2 April 2002 in the Exim Policy.

"The court, in particular, said the DGFT has no power to impose such a ban under the Foreign Control Trade Act. When the hearing came up in the Supreme Court recently, the bench said the government could amend its policy to give effect to the ban under ALS. The judges also asked the government why it should approach the court to change a policy," says Sampat.

The government had banned imports under ALS in February 1999 through a circular because of the steep fall in the price of rubber during 1998-99. Imports under ALS are free since these are made against exports of value-added products. The government then took other measures such as fixing a minimum statutory price for rubber to help stabilise the prices.

Though the ban was relaxed in 2001, it was again tightened last year as over 40,000 tonnes of rubber were imported. The government also came up a few measures such as allowing imports only through Visakhapatnam and Kolkata ports and asking importers to conform shipments to Bureau of Indian Standard norms.