Section 10 of the Foreign Trade (Development and Regulation) Act, 1992 deals with the appointment of licensing authorities for the purpose of granting licenses or authorizations to non-resident Indians. This provision is highly significant in determining the legal status and rights of NRIs who wish to engage in foreign trade activities.
The provision stipulates that every state government shall appoint a licensing authority for granting licenses or authorizations under this Act. The licensing authority must be an officer not below the rank of Deputy Director appointed by the Central Government. The jurisdictional area of such authorities should cover all districts within its territory where applications for export or import are made.
Furthermore, this section emphasizes that if any person contravenes any provisions specified in this Act, he/she will be liable for penalties as per Section 11F(1). However, such penalty may vary depending on the nature and severity of violation committed.
In addition to these provisions, there are several case laws that have strengthened Section 10’s significance. In Ashka Exports vs DGFT (2006), it was held that when an exporter has fulfilled all formalities required under law and regulation specified under Clause 9(3) thereof, then no application could either be rejected or returned without specific findings with reasons being given by competent authority regarding deficiencies noticed therein.
Similarly, in Shriram Fibres vs Union Of India & Ors (2018), it was ruled that exporters are entitled to prefer appeals against orders passed by licensing authorities rejecting their applications beyond appeal period prescribed under Section 15(a).
These case laws have established a coherent jurisprudence around Section 10’s relevant provisions while determining disputes related to export-import transactions involving NRIs.
It is noteworthy that NRIs also face specific challenges while engaging in foreign trade activities due to various factors including distance from home country; cultural differences; lack of knowledge about local regulations/requirements; language barriers etc. Therefore having a designated licensing authority under Section 10 provides NRIs with an accessible institutional mechanism to secure necessary documentation and licenses for their exports or imports.
In conclusion, Section 10 of the Foreign Trade (Development and Regulation) Act is an important piece of legislation that determines the legal status and rights of NRIs in engaging in foreign trade activities. The provision’s strict enforcement through case laws ensures that NRIs have access to a competent governing mechanism for securing necessary authorizations/licenses while conducting international business operations.