licence for the import of capital goods under the concessional custom duty subject to the condition that they would export the final product and earn foreign exchange equivalent as mentioned in the licence within five years from the date of the licence. In view of the grant of the licence, Karnataka Biotics was allowed to clear the imported capital goods at a concessional rate of 15 per cent. For non-payment of the balance customs duty demand, the customs authorities issued a show cause notice. Pursuant to the said notice, the bank guarantee furnished earlier by Karnataka Biotics was encashed. We have carefully perused the sanctioned rehabilitation scheme of Karnataka Biotics under SICA. Various reliefs and concessions were noted in the scheme. It provided for a waiver of payment of specific amounts. The relevant waiver clause reads thus: “(ii) To waive the customs duty payable of Rs. 33.30 lakhs payable on account of non- fulfillment of export obligation and Rs.44.40 lakhs towards