Equal Protection of Rights in Export Policy: Strikes Down Export Quota Criteria for Broken Rice Allocation: Delhi High Court

07 May 2024 8:19 AM

By: Admin

In a landmark judgment handed down on October 20, 2023, the Delhi High Court has set aside the allocation criteria for the export of broken rice to specific countries, asserting that it violates fundamental principles of fairness and equal protection under the law.

The Court, in its verdict, declared that the policy of allocating quotas for the export of broken rice to certain rice exporters, based on their previous exports to particular countries, lacked a rational nexus to the intended goal of ensuring capacity and quality. Justice Vibhu Bakhru and Justice Amit Mahajan emphasized that the classification of rice exporters into separate categories, which determined their eligibility for export quotas, could not be exempt from judicial scrutiny.

Delhi High Court Stated , "The assumption that the exporters that have exported rice to the given countries in question would have the capacity to do so may not be unfounded. However, the point is not whether the rice exporters that have past experience of exporting to the countries in question would have the capacity to service the export quota; the point is whether such exporters would in any manner hold out a more credible assurance of capacity to service the export orders in comparison with other rice exporters having a similar or higher export turnover but to other countries. If the answer to this is in the negative, then clearly the given classification does not have any nexus with the object of ensuring capacity to service the export orders."

The judgment further underscored the importance of ensuring that classification criteria for allocation of quotas must have a rational nexus to their intended objective. It noted that the policy failed to provide any material or rational basis to support the assumption that past exports to specific countries would guarantee better quality or capacity.

As a result of this ruling, the Delhi High Court directed the authorities to re-evaluate the criteria for the allocation of quotas for the export of broken rice.

This judgment has significant implications for the export policy and allocation criteria of commodities in India, reaffirming the principle that such criteria must be just, reasonable, and founded on a rational basis.

In a statement after the ruling, legal experts praised the decision, noting that it reinforced the principles of fairness and equality under the Indian Constitution and ensured that allocation criteria for critical commodities align with their intended objectives.

Date of Decision: 20 October 2023

ASFIVE AGRO PRIVATE LIMITED & ORS VS UNION OF INDIA AND ORS.