Supreme Court Allows Appeals in Foreign Trade Act Case -- Interpretation of Date of Notification as Gazette Publication Date -- Transitional Protection Granted to Importers With Prior Letters of Credit

Nature of Litigation: Civil appeals challenging a High Court order that dismissed writ petitions against a Notification imposing Minimum Import Price on steel products

Remedy Sought

Appellants sought to quash the Notification or obtain a declaration that it does not apply to Letters of Credit opened prior to its publication in the Official Gazette

Filing Reason

The appellants contended that the Notification, published on 11.02.2016, could not apply to imports covered by Letters of Credit opened earlier, specifically on 05.02.2016

Previous Decisions

High Court of Delhi, in a Common Order and Judgment dated 21.12.2018, dismissed the writ petitions, holding that uploading the Notification on 05.02.2016 constituted sufficient notice, though it would operate from 11.02.2016

Issues

Whether the expression date of Notification in para 2 of the Notification can be interpreted to mean any date other than the date of its publication in the Official Gazette Whether importers who opened Letters of Credit on 05.02.2016 are entitled to transitional protection under para 1.05(b) of the Foreign Trade Policy

Submissions/Arguments

Appellants argued that the Notification was non-est prior to 11.02.2016 and that para 2 read with para 1.05(b) of the FTP grants protection to Letters of Credit opened before the date of restriction Respondents argued that the benefit of para 2 is restricted to Letters of Credit entered into before 05.02.2016, and that the date of Notification remains static as 05.02.2016, with the Notification governing imports from 11.02.2016

Ratio Decidendi

The date of a statutory notification issued under the Foreign Trade (Development and Regulation) Act, 1992 is the date of its publication in the Official Gazette as mandated by Section 3 of the Act -- Transitional protection under para 1.05(b) of the Foreign Trade Policy applies to importers who have opened irrevocable Letters of Credit before the date of publication of the notification -- Uploading a notification on a website before gazette publication does not constitute sufficient notice to bind importers

Judgment Excerpts

The controversy lies in narrow compass and turns primarily on the interpretation of the expression 'date of this Notification' occurring in para 2 of Notification No.38/2015-2020 The High Court though held that the Notification would operate from 11.02.2016 i.e., the date of its publication, yet it held that uploading of the Notification on 05.02.2016 constituted sufficient notice The pivotal issue that falls for our consideration is 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 Section 3 of the Act empowers the Central Government to regulate imports and exports by an order published in the Official Gazette

Procedural History

Appellants entered into sale contracts and opened Letters of Credit in February 2016 -- DGFT uploaded Notification on 05.02.2016, published in Official Gazette on 11.02.2016 -- Appellants applied for registration of Letters of Credit under transitional protection on 08.02.2016 -- Appellants filed writ petitions in High Court challenging the Notification -- High Court dismissed writ petitions by Common Order and Judgment dated 21.12.2018 -- Appellants filed Special Leave Petitions in Supreme Court, granted leave, leading to civil appeals