Delhi High Court To Hear DGFT Appeal On Export Authorisation For Aircraft Parts

New Delhi, Oct 8 (KNN) The Delhi High Court is set to hear an appeal by the Directorate General of Foreign Trade (DGFT) against a single judge's order that overruled a DGFT directive requiring special authorisation for exporting aircraft engines and parts. 

The hearing, scheduled for October 8, comes after the DGFT raised concerns during a September 27 session about the potential misuse of the single judge's ruling.

At the heart of the dispute is an order issued by the DGFT in February to AR Sales Pvt Ltd, a global aircraft parts supplier and distributor. 

The company, which had been exporting similar consignments since November 2022, was directed to obtain Specialty Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET) authorisation for a shipment of aircraft engines bound for Russia-headquartered Siberian Airlines.

The DGFT's order was based on catch-all provisions under the Foreign Trade Policy 2023, which allow the trade body to require special authorisation for items not explicitly included in export control lists. 

These provisions are designed to regulate the export of dual-use items that could potentially be used in weapons of mass destruction or for military purposes.

However, Justice Subramonium Prasad of the Delhi High Court quashed the DGFT's order on August 6, ruling that the items in question were of a civil nature and did not fall under SCOMET list restrictions or catch-all provisions. 

Justice Prasad emphasised the need for rationality in import and export regulations to balance economic interests with security concerns.

The DGFT has now appealed this decision, expressing apprehension that the ruling could be used as a precedent, potentially allowing the export of materials that appear to be for civilian use but could be repurposed for military applications. 

The trade body's concerns are particularly relevant in light of recent global conflicts, where civilian components have been adapted for military operations.

During the September 27 hearing, Chief Justice Manmohan acknowledged the complexity of the issue, noting recent instances of consumer electronics being repurposed for military use. 

The court recognised the national security implications and the need for a thorough examination of the matter.

The case highlights the ongoing challenge of regulating dual-use technologies and the delicate balance between facilitating legitimate trade and safeguarding national security interests. 

As the Delhi High Court prepares to hear the DGFT's appeal, the outcome could have significant implications for India's export control regime and its approach to managing potential security risks in international trade.

(KNN Bureau)