Raj HC | Notices to be issued in a matter of classification dispute of rock garnet; Question on validity of notification to canalize the export of products raised

Rajasthan High Court: The Division Bench of Sandeep Mehta and Vinod Kumar Bharwani, JJ. admitted a writ petition which was filed aggrieved by the rejection of representation in the matter of absence of an efficacious remedy to decide classification dispute and directed that notices be issued to respondents.

Petitioner was a registered society with the Cooperative Department, Rajasthan Government and works for the betterment of its members who are manufacturers, traders and exporters of a mineral called rock garnet or garnet (abrasive). The Government of Rajasthan has granted license(s) and mining leases in terms of the Mines and Minerals (Development and Regulation) Act, 1957 read with Mineral Conservation and Development Rules 2017 as amended for mining for these Rock Garnet in the areas of Bhilwara, Chittorgarh, Udaipur, Rajsamand, Tonk, Sawai Madhopur, Ajmer etc.

Respondent 1 issued a notification to canalize the export of products falling under the stipulated HSN codes under Chapter 25 and 26 of Schedule 2 of the ITC (HS) Classification of Export & Import Items, 2018 (“HSN code”). The consequential effect of this notification was that export of BSM can only be undertaken through State Trading Enterprise i.e., respondent 4 (IREL) and not directly as was done earlier.

In order to clarify this issue of interpretation of the notification and to determine whether Rock Garnet comes under the definition of BSM; several applications under the Right to Information Act, 2005 were filed before various authorities by the members of the Petitioner Society. Atomic Mineral Department (AMD) in its RTI response stated that as per records currently, BSM is mined only in the states of Odisha, Kerala and Tamil Nadu. As per study and data collected by Geological Survey of India (GSI) there is nothing mentioned about occurrence of any heavy mineral/ BSM in Rajasthan.

Respondent 3 in their reply to the representation of one of the members of the Petitioner society has categorically stated that “IREL has informed that if any garnet consignments are allowed for export without checks, there is possibility that exporters will try to export the BSM garnet as rock garnet and the port authorities may not be able to differentiate it.” However, only on the pretext of a possibility of exporters trying to export BSM Garnet as Rock Garnet and without applying its mind on simple means of distinguishing the two at the port, the DGFT had rejected the representation.

Owing to this erroneous interpretation, the export consignments of several members of the Petitioner Society were put on hold at various shipping ports in India and the exporters were directed to undergo unnecessary formalities inspite of the fact that the product on question cannot be classified in the category of BSM through any stretch of imagination. This resulted in delay in export shipments and levy of demurrage. This was challenged before the Custom authorities which eventually lead to passing of the impugned order wherein inspite of ample material on record, the issue of classification of Rock Garnet originating from Rajasthan has been remanded back to the adjudicating authority without any interim directions in favor of the exporters and hence the members of the Petitioner organization are relegated back to square one.

Aggrieved by rejection of representation, the instant writ petition was filed on various grounds mentioned in brief below:

a) The letter by respondent 3 is mechanical and without due application of mind. It is apparently based on conjectures and surmises.

b) The letter is in violation of an earlier notification.

c) These are not illegally mined minerals which warrant wrath of the central authorities.

d) The interpretation made in the letter is also against the principle of Intelligible Differentia and hence violates the fundamental right of the Petitioner enshrined under Article 19(1)(g) of the Constitution of India.

e) Respondent 5 vide its order impugned has remanded the matter back to the adjudicating authority which would lead to unnecessary hardship and multicity of litigations.

f) Action of the respondents is not in consonance with economic policy and national interest of India.

g) The said action is unreasonable under Article 19(2) and hence is in violation to the fundamental rights of the Petitioner.

h) The action of respondents is violative of Article 14 of the Constitution of India.

i) Conditions imposed by the State under Article 298 and 299 of the Constitution of India should be reasonable, fair and just by adhering to the principle of Rule of Law however, the conditions imposed on private players like Petitioner members are prima-facie arbitrary and unreasonable are directly favoring to respondent 4.

It was prayed that the letter and impugned order may kindly be quashed and rejected, purposive interpretation to notification be made with respect to Rock Garnet or garnet originating from Rajasthan and the matter may be remanded back to respondent 5.[Rock Abrasive Garnet Trade Society v. Union of India, D.B. Civil Writ Petition No. 5426 of 2022, order dated 23-05-2022]


For petitioner: Mr Siddharth Tatiya


Suchita Shukla, Editorial Assistant has reported this brief.

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