2026 (3) TMI 666 - HC - Customs

Duty to Verify Portal Registrations limited to contracts reflected on the foreign portal; no liability where uploads absent.

The note addresses two issues: whether a domestic agency must register sales contracts not reflected on a foreign authority's online portal, and whether ... Liability for non-registration of sales contracts when those contracts, though registered with the Turkish Grain Board (TMO), were not reflected on the online portal accessible to the CBN - fixation of the Country Cap and the conduct surrounding registration/uploading - violation of the Articles 14 and 19(1)(g) of the Constitution of India - legitimate expectation - international memorandum of understanding - forum non conveniens for foreign authority actions. Role of domestic authority confined to verification of entries on foreign portal - HELD THAT:- The MOU and the Guidelines allocate the responsibility to maintain the online portal to the Turkish Grain Board (TMO) and prescribe that CBN's function is to verify registrations reflected on that portal and thereafter register them. The Court held that uploading to the portal is a distinct step from registration by TMO and, in the absence of the Appellants' contracts being reflected on the portal, CBN had no obligation to register them or to intervene in TMO's registration process. Consequently, no legal liability could be fastened on CBN for non-uploading by TMO and any grievance about uploading lies against the foreign authority operating the portal. [Paras 41, 42, 44, 48, 56] CBN not liable for non-registration because its duty arises only upon contracts being reflected on the TMO portal; the grievance concerns TMO's non-uploading. Judicial restraint in economic policy absent arbitrariness - Whether fixation of the Country Cap and the registration process violated Articles 14 and 19(1)(g) of the Constitution or warranted judicial interference - HELD THAT:- The fixation of the Country Cap and the manner of allocation fall within the domain of economic policy. The Court applied the established principle that courts should not substitute their view for a plausible administrative or policy decision unless it is shown to be manifestly arbitrary, unreasonable or tainted by mala fides. No material established either arbitrariness in the fixation of the Country Cap or a breach by CBN of duties under the MOU and Guidelines; therefore constitutional relief was not warranted. [Paras 22, 46, 55, 57] No violation of Articles 14 or 19(1)(g) established; fixation of Country Cap and related administrative action do not attract judicial interference. Final Conclusion: The Court affirmed the Single Judge's conclusions: CBN's role is limited to registering contracts reflected on the TMO portal and it cannot be held liable for the TMO's non-uploading, and no arbitrariness or constitutional breach was shown in the fixation of the Country Cap; the appeals are dismissed. Issues: (i) Whether the Central Bureau of Narcotics (CBN) can be held liable for non-registration of sales contracts when those contracts, though registered with the Turkish Grain Board (TMO), were not reflected on the online portal accessible to the CBN; (ii) Whether the fixation of the Country Cap and the conduct surrounding registration/uploading violated Articles 14 and 19(1)(g) of the Constitution of India or otherwise amounted to arbitrariness warranting judicial interference.Issue (i): Whether CBN is legally obliged to register contracts not reflected on the portal maintained by TMO.Analysis: The MOU and Guidelines allocate the responsibility to maintain the online system to TMO and prescribe that CBN's role is to verify registrations as per details accessible on that portal and thereafter register and upload details. The Guidelines further distinguish registration by TMO and subsequent uploading for CBN's processing. The learned Single Judge's interpretation of these contractual and procedural provisions was plausible and within appellate restraint. The evidence shows the Appellants' contracts were not reflected on the portal because TMO did not upload them after the Country Cap was exhausted; there is no material establishing CBN overlooked contracts that were reflected or acted arbitrarily in processing reflected contracts. Judicial intervention to supervise procedures internal to a foreign authority operating under its own law is not warranted in the absence of a legal duty on the domestic authority to intervene.Conclusion: CBN cannot be held liable for non-registration of contracts that were not reflected on the TMO portal; no legal duty arose on CBN to register or to override the TMO's uploading procedure.Issue (ii): Whether fixation of the Country Cap or the registration/uploading process breached Articles 14 and 19(1)(g) by being arbitrary or unfair.Analysis: Allocation of a limited state-controlled commercial opportunity (import quantity) engages principles of fairness and non-arbitrariness, but policy decisions on import regulation and country caps lie within the realm of economic policy and international arrangement. Legitimate expectation requires an enforceable right or established procedure. Here, the MOU places responsibility on the TMO to ensure registrations do not exceed the Country Cap and does not impose on CBN a supervisory obligation over TMO's internal uploading. No material established mala fides, manifest arbitrariness, or discriminatory countersigning by CBN; grievances about TMO's uploading procedure concern a foreign authority and do not supply a ground for writ relief against CBN.Conclusion: The fixation of the Country Cap at the notified level and the non-uploading by TMO do not constitute a breach of Articles 14 or 19(1)(g) by CBN and do not attract judicial interference.Final Conclusion: The appellate court finds the Single Judge's view plausible and declines to substitute its own assessment; the impugned judgment is upheld and the appeals lack merit.Ratio Decidendi: Where a bilateral MOU and implementing Guidelines assign maintenance of an online registration portal and the initial registration function to a foreign authority, the domestic authority's duty to register arises only upon verification of contracts reflected on that portal; absent reflection and absent material showing arbitrariness or mala fides by the domestic authority, courts will not impose liability or supervise the procedural choices of the foreign authority.