2026 (1) TMI 1102 - SC - Customs

Publication of trade notification in Official Gazette determines its operative date, securing transitional protection for prior imports.

Delegated trade notifications acquire legal force only upon publication in the Official Gazette; therefore the expression date in a notification must be ... Effective Date of the Notification - Publication in the Official Gazette - import and trading of mild steel items such as Hot Rolled Coils, Cold Rolled Coils, Hot Rolled Steel Plates and Pre Painted Steel Coils etc - promulgation of delegated legislation - expression 'date of this Notification' in Notification No. 38/2015-20 - transitional protection under para 1.05(b) of the Foreign Trade Policy, 2015-2020 - Notice requirement for delegated legislation - Non-est of law prior to publication - Whether the expression ‘date of Notification’ mentioned in para 2 of the Notification issued under the Act, can be interpreted to mean any date, other than the date of its publication in the Official Gazette. - HELD THAT:- Admittedly, prior to February, 2016, the said items were freely importable and fell under Chapter-72 of the Indian Trade Clarification (Harmonized System), 2012 (‘ITC-HS’), Schedule-I of the Foreign Trade Policy, 2015-2020 (FTP). Law, to bind, must first exist. And to exist, it must be made known in the manner ordained by the legislature. Delegated legislation, unlike plenary legislation enacted by the Parliament, is framed in the executive chambers without open legislative debate. The requirement of publication in the Gazette, therefore, serves a dual constitutional purpose i.e. (a) it ensures accessibility and notice to those governed by the law, and (b) it ensures accountability and solemnity in the exercise of delegated legislative power. The requirement of publication in the Gazette, is therefore not an empty formality. It is an act by which an executive decision is transformed into law. It is precisely for this reason that courts have consistently insisted that strict compliance with the publication requirements is a condition precedent for the enforceability of delegated legislation. The benefit of transitional provision contained in para 1.05(b) of the FTP cannot be denied to the appellants, as the same would defeat the plain language of the FTP and would undermine the object of the parent Act, and would introduce uncertainty to a field where certainty is indispensable. The imposition of fiscal or trade burdens on the basis of an unpublished Notification would erode commercial confidence and offend the Rule of Law, the result which the court must steadfastly guard against. Once it is held that Notification became operative only on 11.02.2016, the expression ‘date of this Notification’ occurring in para 2 thereof, must necessarily be construed to mean the date of its publication in the Official Gazette. Accordingly, the issue is answered. The appellants having opened irrevocable Letters of Credit prior to 11.02.2016 and having complied with procedural requirements under para 1.05(b) of the FTP are clearly entitled to the benefit of transitional provision contained therein. The MIP introduced by the Notification with effect from 11.02.2016 cannot be applied to imports effected by the appellants pursuant to irrevocable Letters of Credit prior to 11.02.2016. We accordingly hold that the Notification issued under Section 3 of the Act acquires the force of law only upon its publication in the Official Gazette. The expression ‘date of this Notification’ must necessarily mean the date of such publication. Appeals are allowed. Issues: (i) Whether the expression 'date of this Notification' in paragraph 2 of Notification No. 38/2015-20 dated 5 February 2016 must be interpreted as the date of its publication in the Official Gazette, and (ii) whether imports under Letters of Credit opened before that date are entitled to the transitional protection under paragraph 1.05(b) of the Foreign Trade Policy, 2015-2020.Analysis: The parent statute requires orders regulating imports or exports to be made by an Order published in the Official Gazette. Publication in the Gazette is the mode of promulgation prescribed by the legislature and is a precondition for delegated legislation to acquire legal force. Established principles require strict compliance with the prescribed mode of promulgation to ensure accessibility, notice and accountability. The Notification dated 5 February 2016 stated it was 'to be published in the Gazette of India' and was published on 11 February 2016; therefore it did not acquire the force of law prior to publication. Paragraph 2 of the Notification incorporates paragraph 1.05(b) of the Foreign Trade Policy, which provides transitional protection for imports where an irrevocable letter of credit was established before the imposition of a restriction, subject to registration requirements. Construing 'date of this Notification' consistently with the statute and accepted modes of promulgation, that expression must be read as the date of publication in the Official Gazette. Applying that construction, imports pursuant to Letters of Credit opened before publication are within the transitional protection, subject to compliance with paragraph 1.05(b).Conclusion: The expression 'date of this Notification' means the date of publication of the Notification in the Official Gazette; the Notification acquired legal force only on 11 February 2016; and the appellants, having opened irrevocable Letters of Credit prior to 11 February 2016 and complied with paragraph 1.05(b), are entitled to the transitional protection and exemption from the Minimum Import Price for those imports.