The Supreme Court has reaffirmed a foundational principle of administrative law: delegated legislation cannot bind citizens until formally published in the Official Gazette. This judgment resolves a critical conflict between administrative convenience and legal certainty in foreign trade regulation, offering clear guidance to importers, trade authorities, and legal practitioners navigating regulatory transitions.
Background & Facts
The Dispute
The appellants, private steel importers, entered into firm sale contracts with Chinese and South Korean suppliers between 29 January and 4 February 2016. On 5 February 2016, they opened irrevocable letters of credit (LCs) to finance these imports. On the same day, the Directorate General of Foreign Trade (DGFT) uploaded a Notification on its website imposing a Minimum Import Price (MIP) on 173 HS-coded steel products under Chapter 72 of the ITC-HS. The Notification explicitly stated: 'To be published in the Official Gazette of India'. It was formally published in the Gazette on 11 February 2016.
Procedural History
- 5 February 2016: Appellants opened irrevocable LCs; DGFT uploaded MIP Notification online
- 8 February 2016: Appellants applied for LC registration under transitional protection in para 1.05(b) of FTP
- 11 February 2016: MIP Notification published in Official Gazette
- 2018: Delhi High Court dismissed writ petitions, holding that upload on 5 February constituted sufficient notice
- 2026: Appeals filed before Supreme Court challenging the High Court’s interpretation
Relief Sought
The appellants sought quashing of the Notification or, alternatively, a declaration that the MIP does not apply to LCs opened before 11 February 2016, invoking transitional protection under para 1.05(b) of the Foreign Trade Policy.
The Legal Issue
The central question was whether the expression 'date of this Notification' in para 2 of the MIP Notification refers to the date of its online upload or the date of its formal publication in the Official Gazette under Section 3 of the Foreign Trade (Development and Regulation) Act, 1992.
Arguments Presented
For the Appellant
The appellants argued that delegated legislation must strictly comply with the parent statute’s mandate of publication in the Official Gazette to acquire legal force. They relied on B.K. Srinivasan v. State of Karnataka and Harla v. State of Rajasthan, emphasizing that publication is not a mere formality but a constitutional requirement for notice and accountability. They contended that para 2 of the Notification explicitly incorporates para 1.05(b) of the FTP, which protects imports under LCs opened before the date of restriction - meaning 11 February 2016, not 5 February.
For the Respondent
The Union contended that the 'date of Notification' in para 2 referred to 5 February 2016, the date of upload, arguing that the legal effect of the Notification was prospective from 11 February, but its benefit was limited to LCs opened before the upload date. They analogized to the Land Acquisition Act, where enactment and enforcement dates differ, and claimed that para 1.05(b) was merely procedural and subordinate to the Notification’s overriding authority.
The Court's Analysis
The Court undertook a rigorous analysis of the statutory framework under Section 3 of the Foreign Trade (Development and Regulation) Act, 1992, which mandates that any order regulating imports must be 'published in the Official Gazette'. The Court rejected the notion that online publication could substitute statutory publication, noting that the Notification itself acknowledged its incomplete status by stating 'To be published in the Gazette'.
"The requirement of publication in the Gazette... is not an empty formality. It is an act by which an executive decision is transformed into law."
The Court emphasized that delegated legislation, unlike parliamentary law, lacks democratic scrutiny and must therefore be subject to strict procedural safeguards. Citing Harla v. State of Rajasthan and Gulf Goans Hotels Co. Ltd. v. Union of India, the Court held that legal enforceability begins only upon Gazette publication. To hold otherwise would permit the executive to impose obligations retroactively, violating the Rule of Law and the principle of audi alteram partem.
The Court further clarified that para 1.05(b) of the FTP is not in conflict with the Notification but is expressly incorporated into it. Denying transitional protection would undermine the FTP’s objective of commercial certainty and expose importers to unpredictable regulatory shifts. The Court concluded that the expression 'date of this Notification' must be interpreted consistently with the parent statute and the doctrine of legal notice.
The Verdict
The appellants won. The Supreme Court held that delegated legislation acquires legal force only upon publication in the Official Gazette, and the expression 'date of this Notification' in para 2 must be construed as the date of such publication. The MIP cannot be applied to imports under LCs opened before 11 February 2016, and the appellants are entitled to the transitional protection under para 1.05(b) of the FTP.
What This Means For Similar Cases
Publication Is the Sole Trigger for Legal Effect
- Practitioners must challenge any regulatory action based on non-Gazette publication, even if the regulation was widely disseminated online
- Government departments must ensure Gazette publication precedes enforcement; failure invalidates the measure
- Importers and exporters can rely on the Gazette date, not website uploads or circulars, to determine applicability of new restrictions
Transitional Protections Are Presumed Unless Explicitly Excluded
- Where a policy (like FTP) provides transitional relief, courts will interpret it broadly to protect legitimate commercial expectations
- Regulatory notifications incorporating policy provisions cannot override those provisions without clear, unambiguous language
- The burden shifts to the state to prove that transitional protection was expressly denied
Commercial Certainty Trumps Administrative Convenience
- Trade regulations affecting contracts and LCs must be predictable; retroactive application undermines foreign investment and contractual stability
- Courts will not permit executive agencies to create legal obligations through informal channels
- Legal advisors should advise clients to document all LC openings and registrations immediately upon awareness of impending restrictions
