The Supreme Court has delivered a clear ruling on when government trade restrictions legally take effect, settling a long-running dispute between steel importers and the Union of India. The Court held that a notification imposing Minimum Import Price (MIP) on steel products became enforceable only on the date it was published in the Official Gazette-not when it was uploaded online. The judgment brings relief to importers who had opened Letters of Credit before the gazette publication
Background of the Case
The appeals were filed by Viraj Impex Pvt. Ltd. and other importers engaged in trading mild steel products such as hot rolled coils and steel plates. Until early 2016, these items were freely importable under India’s Foreign Trade Policy (FTP).
Read also:- Orissa High Court Issues Arrest Warrant Against Senior IAS Officer Over Non-Compliance of Court Order
Between January 29 and February 4, 2016, the companies entered into firm contracts with overseas suppliers in China and South Korea. On February 5, 2016, they opened irrevocable Letters of Credit (LCs) to secure the imports.
On the same day, the Directorate General of Foreign Trade (DGFT) uploaded a notification on its website introducing a Minimum Import Price for certain steel products. However, the document itself stated that it was “to be published in the Official Gazette.” That official publication happened later, on February 11, 2016.
Anticipating possible restrictions, the importers applied for protection under the FTP’s transitional provision, which safeguards imports backed by LCs opened before a restriction is imposed.
Read also:- Supreme Court Grants Anticipatory Bail to Directors in ₹5 Crore Grey Call Routing Case
Delhi High Court’s View
When the matter first reached the Delhi High Court, it agreed that the notification formally operated from February 11, 2016. Still, the High Court held that uploading the notification on February 5 gave sufficient notice to importers. As a result, it denied relief to those who had not opened their LCs before February 5, 2016, and dismissed the writ petitions.
This finding pushed the importers to approach the Supreme Court.
Key Question Before the Supreme Court
The central issue was narrow but significant:
Does the phrase “date of this notification” mean the date it was uploaded online, or the date it was published in the Official Gazette as required by law?
Court’s Observations
A bench led by Justice Alok Aradhe and Justice P. S. Narasimha underscored a basic principle of law: a rule or restriction cannot bind citizens unless it legally exists.
Read also:- PhD Requirement for Higher Pay Upheld: Delhi High Court Backs AICTE on Lecturer Salary Rules
“The requirement of publication in the Official Gazette is not an empty formality,” the bench observed, explaining that publication is what transforms an executive decision into enforceable law.
The Court noted that the Foreign Trade (Development and Regulation) Act, 1992, clearly mandates that any order restricting imports must be published in the Official Gazette. Uploading a draft or unsigned version on a website, the judges said, cannot substitute this statutory requirement.
The bench also rejected the idea of “fragmented enforcement,” warning that allowing unpublished notifications to affect rights would undermine legal certainty and commercial confidence.
Interpretation of the Foreign Trade Policy
The Court carefully read the notification alongside Paragraph 1.05(b) of the Foreign Trade Policy. This provision allows imports to proceed if an irrevocable Letter of Credit was opened before the “date of imposition” of a restriction.
Since the notification only became law on February 11, 2016, the Court held that this date alone could be treated as the “date of the notification.” Any other interpretation, it said, would defeat the plain language of the policy and the purpose of the parent statute.
Decision
Allowing the appeals, the Supreme Court set aside the Delhi High Court’s judgment. It ruled that the Minimum Import Price notification acquired legal force only on February 11, 2016, the date of its publication in the Official Gazette.
As a result, steel imports backed by irrevocable Letters of Credit opened before that date are protected from the MIP restriction. The Court held the importers entitled to the benefit of the FTP’s transitional provision and allowed all appeals without costs.
Case Title: Viraj Impex Pvt. Ltd. v. Union of India & Another
