Retrospective DGFT clarification cannot justify confiscation of consignments completed before the circular was issued.

A later DGFT clarification could not be applied to consignments that were already inspected and shipped before the clarification was issued. In the absence of express retrospective effect, the earlier regulatory position governed those transactions, so rejection of the inspection certificates on the basis of the later circular was legally unsustainable. Confiscation founded on that post-transaction clarification therefore could not be upheld, and the appellant obtained consequential relief.

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Issues: Whether the later DGFT circular clarifying acceptance of inspection certificates issued by a branded office could be applied to consignments inspected and shipped before the circular was issued, and whether confiscation could be sustained on that basis.

Analysis: The consignments were inspected and shipped before the issuance of the February 2005 clarification. A subsequent circular cannot govern completed transactions in the absence of retrospective operation. Since the lower authorities relied on the later clarification to reject the certificates and order confiscation, the foundation of the impugned order was legally unsustainable.

Conclusion: The later circular could not be applied to the present consignments, and the confiscation based on that clarification was not justified.

Final Conclusion: The appeals succeeded and the appellant obtained consequential relief.

Ratio Decidendi: A circular or clarification issued after the relevant inspection and shipment cannot be applied retrospectively to validate confiscation of consignments already dealt with under the earlier regime, unless retrospective effect is expressly provided.

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