DGFT Restriction Can’t Apply Retrospectively to Goods Already Arrived in India: Delhi High Court

The Delhi High Court has ruled in favour of a precious metals importer, holding that a Directorate General of Foreign Trade (DGFT) notification restricting imports of certain jewellery products cannot be applied retrospectively to consignments that had already arrived in India before the notification was officially published. The bench of Justice Nitin Wasudeo Sambre and Justice Ajay Digpaul has observed that the DGFT notification became effective only when it was digitally published at 20:52:28 hours on April 2, 2026. Any attempt to apply it to consignments that had already reached Indian territory before that moment would amount to giving the notification retrospective effect. The case arose after M/s Bright Metal Refiners, a Delhi-based importer and trader of precious metals, imported platinum alloy jewellery studded with rubies from Thailand through multiple consignments arriving at airports in Mumbai, Delhi and Amritsar. The consignments were dispatched on March 31 and April 1, 2026, and reached Indian airports between April 1 and April 2, 2026. However, while the goods were in transit or had already landed, the DGFT issued Notification No. 02/2026-27 dated April 1, 2026, changing the import policy for goods falling under Customs Tariff Heading (CTH) 7113 from “Free” to “Restricted.” The notification was digitally published in the e-Official Gazette on April 2, 2026, at 20:52:28 hours. The notification specifically stated that the benefit of transitional arrangements would not be available and that the revised policy would apply regardless of prior contracts, letters of credit, advance payments or shipment status. Following issuance of the notification, Customs authorities refused to clear the imported consignments, informing the importer that a valid import licence or authorisation was now required. The importer argued that the goods had been dispatched and had arrived in India before the notification acquired legal force and therefore could not be subjected to the newly imposed restriction. The petitioner also pointed out that Customs authorities themselves had sought clarification from the Central Board of Indirect Taxes and Customs (CBIC) regarding the interpretation of the notification, particularly the phrases “irrespective of shipment status” and “transitional arrangements.” The principal issue was whether a notification published in the e-Official Gazette at 20:52:28 hours on April 2, 2026, could be applied to goods that had already been dispatched and had arrived in India before that exact time. The importer contended that the last of its consignments reached India at 1:39 a.m. on April 2, 2026—nearly 20 hours before the notification was published—and therefore the restriction could not legally apply. The High Court relied heavily on the Supreme Court's recent decision in Viraj Impex Pvt. Ltd. v. Union of India, where the apex court clarified that delegated legislation acquires the force of law only after publication in the Official Gazette. The Supreme Court had emphasized that publication is not a mere procedural formality but a constitutional requirement ensuring notice and transparency. The Delhi High Court noted that until publication occurs in the prescribed manner, a notification remains an executive decision and does not attain legal enforceability. The Court also referred to the Supreme Court's ruling in Union of India v. G.S. Chatha Rice Mills, which held that in the era of electronic gazette publication, the precise timestamp of publication assumes critical importance. The Supreme Court had ruled that revised import duties become applicable only to transactions occurring after the notification is uploaded in the e-Gazette. The Bench further relied on the Supreme Court's landmark decision in Kanak Exports, which held that delegated legislation cannot ordinarily operate retrospectively unless the parent statute expressly grants such power. Since the Foreign Trade (Development and Regulation) Act, 1992 does not confer retrospective rule-making authority upon the Central Government, the notification could only operate prospectively. The Court observed that all the petitioner's consignments had been dispatched before the restriction came into force and had arrived at Indian airports before publication of the notification. Consequently, the imports were governed by the earlier policy regime under which the goods were freely importable. The Court also noted that the Gujarat High Court had recently dealt with an identical notification in Enero Jewels Pvt. Ltd. v. Union of India. In that case, the Gujarat High Court had similarly ruled that the notification could not be applied to goods that had landed before its digital publication. Finding no material distinction between the two cases, the Delhi High Court agreed with the Gujarat High Court's reasoning and held that the notification could not retrospectively affect consignments already imported. Allowing the writ petition, the Court held that the imported platinum alloy jewellery had entered India before the notification became operative and therefore remained eligible for clearance under the pre-existing “Free” import policy. The Court directed Customs authorities to process and release the consignments immediately without insisting on an import authorisation under the revised restricted regime. Case Details Case Title: M/S Bright Metal Refiners Versus Director General Citation: JURISHOUR-1549-HC-2026(DEL) Case No.: W.P.(C) 5551/2026 Date: 04/06/2026 Counsel For Petitioner: Prakash Shah, Senior Advocate Counsel For Respondent: Kamal Kant Jha, CGSC Click Here To Read Order Read More: Can DGGI Arrest Without Prior Notice? Delhi HC Upholds 7-Day Advance Notice Safeguard

DGFT Restriction Can’t Apply Retrospectively to Goods Already Arrived in India: Delhi High Court

Membership Required

Latest articles

Can ITC Be Availed on Delivery Challans Instead of Tax Invoices? GSTAT to Examine S. 16(2) Issue

GST Appeal Barred by Limitation? Rajasthan HC Allows Delayed Appeal Where Delay Was Beyond Taxpayer’s Control

No Coercive GST Recovery Against Former Partner Till Appeal is Decided: Himachal Pradesh High Court

Service Tax Recovery from Deceased Proprietor’s Widow Quashed: Chhattisgarh High Court

More like this

Can ITC Be Availed on Delivery Challans Instead of Tax Invoices? GSTAT to Examine S. 16(2) Issue

GST Appeal Barred by Limitation? Rajasthan HC Allows Delayed Appeal Where Delay Was Beyond Taxpayer’s Control

No Coercive GST Recovery Against Former Partner Till Appeal is Decided: Himachal Pradesh High Court

About us

Company

Categories