# UNION OF INDIA & ORS v. M/S G S CHATHA RICE MILLS & ANR

- **Citation:** [2020] 14 S.C.R. 571
- **Court:** Supreme Court of India
- **Decided:** 2020-09-23
- **Case number:** Civil Appeal No. 3249 of 2020
- **Bench:** Dr Dhananjaya Y Chandrachud, Indu Malhotra, K. M. Joseph
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/union-of-india-ors-v-m-s-g-s-chatha-rice-mills-anr-34413
- **Pages:** 120

## Headnote

Customs Tariff Act, 1975: ss.8A and 11A - Customs Act, 1962
- ss.12, 15, 17, 46 and 47 - Assessment of duty - Shift from manual
to electronic form of governance - Impact of - Publication of
notification on e-gazette - Time of publication on e-gazette -
Relevance of - Starting point for enforceability of e-notification -
On 16 February 2019, the Union Government issued a notification
(Notification 5/2019) u/s.8A of the Customs Tariff Act - The
notification introduced a tariff entry by which all goods imported
from Pakistan were subjected to enhanced customs duty - The
notification was published through electronic mode i.e. uploaded
on the e-Gazette late in the evening of 16th Feb 2019 at 20:46:58
hours - Importers concerned, who had imported goods from
Pakistan, had presented their bills of entry and completed the process
of "self assessment" before the notification enhancing the rate of
duty was issued and uploaded - Whether Notification 5/2019 was
applicable with retrospective effect and the importers concerned
were liable to pay duty on the basis of enhanced rate under the
Notification - Held: With the change in the manner of publishing
gazette notifications from analog to digital, the precise time when
the gazette is published in the electronic mode assumes significance
- Notification 5/2019 must come into operation with reference to
the point of time of the day when it was published on the e-gazette
- Notification 5/2019, which is akin to the exercise of delegated
legislative power, under the emergency power to notify and revise
tariff duty under s.8A of the Customs Tariff Act, cannot operate
retrospectively, unless authorized by statute - In the era of the
electronic publication of gazette notifications and electronic filing
of bills of entry, the revised rate of import duty under the Notification
5/2019 applies to bills of entry presented for home consumption
[2020] 14 S.C.R. 571
571
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after the notification was uploaded in the e-Gazette at 20:46:58
hours on 16 February 2019 - In the instant case, the twin conditions
of s.15 of the Customs Act, 1962 stood determined prior to the
issuance of Notification 5/2019 on 16 February 2019 at 20:46:58
hours - The rate of duty which was applicable was crystallized at
the time and on the date of the presentation of the bills of entry in
terms of provisions of s.15 of the Customs Act read with Regulation
4(2) of the Regulations of 2018 - Power of reassessment under
s.17(4) could not have been exercised since this is not a case where
there was an incorrect self-assessment of duty - The duty was
correctly assessed at the time of self-assessment in terms of the duty
which was in force on that date and at the time - Subsequent
publication of the notification bearing 5/2019 did not furnish a
valid basis for re-assessment - Bill of Entry (Electronic Integrated
Declaration and Paperless Processing) Regulations, 2018 -
Information Technology Act, 2000 - ss.13 and 8 - Information
Technology (Electronic Service Delivery) Rules 2011 - r.5(1) -
Notifications/Circulars/Government Orders.
Circulars/Government Orders/Notifications: Emergency
power conferred upon the Central government u/s.8A of the Customs
Tariff Act to increase import duties "in respect of any article included
in the first schedule" - Notification enhancing rate of duty u/s.8A
of the Customs Tariff Act - Applicability of - Retrospective or
prospective - Held: A rule framed by the delegate of the legislature
does not have retrospective effect unless the statutory provision
under which it is framed allows retrospectivity either by the use of
specific words to that effect or by necessary implication -
Entrustment of the power to issue a notification enhancing the rate
of duty u/s.8A is not accompanied by a statutory entrustment of
authority to the Central government to exercise it with retrospective
effect - A notification u/s.8A(1), even though it has the effect of
amending

## Text

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UNION OF INDIA & ORS.
v.
M/S G S CHATHA RICE MILLS & ANR.
(Civil Appeal No 3249 of 2020)
SEPTEMBER 23, 2020
[DR DHANANJAYA Y CHANDRACHUD,
INDU MALHOTRA AND K. M. JOSEPH, JJ.]
Customs Tariff Act, 1975: ss.8A and 11A - Customs Act, 1962
- ss.12, 15, 17, 46 and 47 - Assessment of duty - Shift from manual
to electronic form of governance - Impact of - Publication of
notification on e-gazette - Time of publication on e-gazette -
Relevance of - Starting point for enforceability of e-notification -
On 16 February 2019, the Union Government issued a notification
(Notification 5/2019) u/s.8A of the Customs Tariff Act - The
notification introduced a tariff entry by which all goods imported
from Pakistan were subjected to enhanced customs duty - The
notification was published through electronic mode i.e. uploaded
on the e-Gazette late in the evening of 16th Feb 2019 at 20:46:58
hours - Importers concerned, who had imported goods from
Pakistan, had presented their bills of entry and completed the process
of "self assessment" before the notification enhancing the rate of
duty was issued and uploaded - Whether Notification 5/2019 was
applicable with retrospective effect and the importers concerned
were liable to pay duty on the basis of enhanced rate under the
Notification - Held: With the change in the manner of publishing
gazette notifications from analog to digital, the precise time when
the gazette is published in the electronic mode assumes significance
- Notification 5/2019 must come into operation with reference to
the point of time of the day when it was published on the e-gazette
- Notification 5/2019, which is akin to the exercise of delegated
legislative power, under the emergency power to notify and revise
tariff duty under s.8A of the Customs Tariff Act, cannot operate
retrospectively, unless authorized by statute - In the era of the
electronic publication of gazette notifications and electronic filing
of bills of entry, the revised rate of import duty under the Notification
5/2019 applies to bills of entry presented for home consumption
[2020] 14 S.C.R. 571
571
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[2020] 14 S.C.R.
after the notification was uploaded in the e-Gazette at 20:46:58
hours on 16 February 2019 - In the instant case, the twin conditions
of s.15 of the Customs Act, 1962 stood determined prior to the
issuance of Notification 5/2019 on 16 February 2019 at 20:46:58
hours - The rate of duty which was applicable was crystallized at
the time and on the date of the presentation of the bills of entry in
terms of provisions of s.15 of the Customs Act read with Regulation
4(2) of the Regulations of 2018 - Power of reassessment under
s.17(4) could not have been exercised since this is not a case where
there was an incorrect self-assessment of duty - The duty was
correctly assessed at the time of self-assessment in terms of the duty
which was in force on that date and at the time - Subsequent
publication of the notification bearing 5/2019 did not furnish a
valid basis for re-assessment - Bill of Entry (Electronic Integrated
Declaration and Paperless Processing) Regulations, 2018 -
Information Technology Act, 2000 - ss.13 and 8 - Information
Technology (Electronic Service Delivery) Rules 2011 - r.5(1) -
Notifications/Circulars/Government Orders.
Circulars/Government Orders/Notifications: Emergency
power conferred upon the Central government u/s.8A of the Customs
Tariff Act to increase import duties "in respect of any article included
in the first schedule" - Notification enhancing rate of duty u/s.8A
of the Customs Tariff Act - Applicability of - Retrospective or
prospective - Held: A rule framed by the delegate of the legislature
does not have retrospective effect unless the statutory provision
under which it is framed allows retrospectivity either by the use of
specific words to that effect or by necessary implication -
Entrustment of the power to issue a notification enhancing the rate
of duty u/s.8A is not accompanied by a statutory entrustment of
authority to the Central government to exercise it with retrospective
effect - A notification u/s.8A(1), even though it has the effect of
amending the First Schedule to the Customs Tariff Act, takes effect
prospectively - Customs Tariff Act, 1975 - s.8A - Delegated
legislation.
Circulars/Government Orders/Notifications: E-notification -
Publication through e-gazettes - Basis for - Held: s.8 of the
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Information Technology Act creates a legal basis for publication of
laws through e-gazettes - Information Technology Act, 2000 - s.8.
Legislation: Delegated legislation - Distinction between
plenary powers entrusted to Parliament and the State legislatures
to enact legislation with both prospective and retrospective effect,
and the power entrusted to a delegate of the legislature to frame
subordinate legislation - Constitution of India - Arts. 245 and 246.
Legislature: When legislature is silent on a subject - Held:
Legislature does not always say everything on the subject - When it
enacts a law, every conceivable eventuality which may arise in the
future may not be present to the mind of the lawmaker - Legislative
silences create spaces for creativity - Between interstices of
legislative spaces and silences, the law is shaped by the robust
application of common sense.
General Clauses Act 1897: s.5(3) - Coming into operation of
an enactment - s.5(3) makes it abundantly clear that it is only a
'Central Act' or 'Regulation' which comes into operation immediately
on the expiration of the day preceding its commencement.
General Clauses Act, 1897: s.3(50) - Notification issued by
Central government under sub-section (1) of s.8A of the Customs
Tariff Act - Held: Does not fulfil the description of a Regulation
under s.3(50) of the General Clauses Act - The expression is
confined to specific species of Regulations - The definition does
not extend to all subordinate legislation or to notifications issued
by a delegate of the legislature acting in pursuance of a statutory
authority - Customs Tariff Act, 1975 - s.8A - Circulars/Government
Orders/Notifications.
General Clauses Act, 1897: s.3(7) - Notification issued by
Central government u/s.8A of the Customs Tariff Act - Held: Is not
an Act of Parliament - The Central government as a delegate of the
legislature is entrusted with the authority to issue such a notification
- The mere fact that a piece of delegated legislation has been issued
in exercise of a legislatively conferred power does not bring the
delegated legislation within the ambit of the phrase "Central Act"
as defined in s.3(7) of the General Clauses Act - Customs Tariff
Act, 1975 - s.8A - Circulars/Government Orders/Notifications -
Legislation - Delegated legislation.
UNION OF INDIA & ORS. v. M/S G S CHATHA RICE MILLS & ANR.
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Tax/Taxation: Imposition of a tax - Three stages encompassing
the same, namely, declaration of liability, assessment, and methods
of recovery.
Dismissing the appeals, the Court
HELD (per Dr. D Y Chandrachud, J. [for himself and Indu
Malhotra, J.]):
1.1. In interpreting the statute, the court is guided by the
terms of its provisions, the purpose underlying their adoption
and the scheme which emerges from interrelated provisions and
the nature of the provision. The court in the present case is
interpreting the terms of a fiscal levy. The court here has to
construe the scheme and provisions of the Customs Act and their
relationship with the provisions of the Customs Tariff Act. [Para
34]
1.2. The Union of India is textually right in emphasizing
that Section 15(1) of the Customs Act, 1962 contains a reference
to date and not time. But there are two responses to this line of
approaching the issue. First, the legislature does not always say
everything on the subject. When it enacts a law, every conceivable
eventuality which may arise in the future may not be present to
the mind of the lawmaker. Legislative silences create spaces for
creativity. Between interstices of legislative spaces and silences,
the law is shaped by the robust application of common sense.
Second, regulatory governance is evolving in India as new
technology replaces old and outmoded ways of functioning. The
virtual world of electronic filings was not on the horizon when
Parliament enacted the Customs Act in 1962. Yet the Parliament
has responded to the rapid changes which have been brought
about by the adoption of technology in governance. In the
provisions of Section 17 and Section 46 of the Customs Act, 1962,
the impact of ICT-based governance has been recognized by the
legislature in providing for the presentation of bills of entry in
the electronic form on the customs automated EDI system. The
considerations which Parliament had in its view in providing for
crucial amendments to the statutory scheme by moving from
manual to electronic forms of governance in the assessment of
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duties must not be ignored. Tax administration must leave behind
the culture of an age in which the assessment of duty was wrought
with delays, discretion, doubt and sometimes, the dubious. The
interpretation of the court must aid in establishing a system which
ensures certainty for citizens, ease of application and efficiency
of administration. [Para 35]
2.1. A notification under Section 8A(1) of the Customs Tariff
Act, even though it has the effect of amending the First Schedule
to the Customs Tariff Act, takes effect prospectively. Section 8A
does not confer upon the notification an operation anterior to its
making. In the language of the law, its operation is prospective.
[Para 36]
2.2. The provisions of Sections 15(1)(a), 17, 46(1) and
47(2)(a) of the Customs Act constitute one composite scheme.
As a result of the modalities prescribed for the electronic
presentation of the bill of entry and self-assessment after the
entry of the electronic declaration on the customs automated
system, a bill of entry number is generated by the EDI system
for the declaration. Regulation 4(2) of the Bill of Entry (Electronic
Integrated Declaration and Paperless Processing) Regulations,
2018 provides for a deeming fiction in regard to the filing of the
bill of entry and the completion of self-assessment. The
submission on behalf of the Union of India, simply put, is that
because notification 5/2019 was issued on 16 February 2019, the
court must regardless of the time at which it was uploaded on the
e-Gazette treat it as being in existence with effect from midnight
or 0000 hours on 16 February 2019. The consequence of this
interpretation would be to do violence to the language of Section
8A(1) of the Customs Tariff Act, and to disregard the meaning,
intent and purpose underlying the adoption of provisions in the
Customs Act in regard to the electronic filing of the bill of entry
and the completion of self-assessment. [Para 36]
3.1. A notification which is issued in terms of the provisions
of Sub-section (1) of Section 8A the Customs Tariff Act 1975 is
akin to the exercise of a delegated legislative power. In issuing a
notification under Sub-section (1) of Section 8A, the Central
UNION OF INDIA & ORS. v. M/S G S CHATHA RICE MILLS & ANR.
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government exercises power as a delegate of the legislature.
[Para 39]
3.2. Section 5(3) of the General Clauses Act 1897 makes it
abundantly clear that it is only a 'Central Act' or 'Regulation'
which comes into operation immediately on the expiration of the
day preceding its commencement. A notification issued by the
Central government under sub-section (1) of Section 8A does
not fulfill the description of a Regulation under Section 3(50) of
the General Clauses Act. The expression is confined to specific
species of Regulations. The definition does not extend to all
subordinate legislation or to notifications issued by a delegate of
the legislature acting in pursuance of a statutory authority. [Paras
40, 41]
3.3. The expression "Central Act" is defined by using the
expressions "shall mean" and "shall include". The use of these
expressions indicates that the definition is exhaustive. Insofar
as is relevant, the expression 'Central Act' is defined to mean an
Act of Parliament. A notification which has been issued under
Sub-section (1) of Section 8A of the Customs Tariff Act is not an
Act of Parliament. The notification has the effect of amending the
First schedule to the Customs Tariff Act. The Central government
as a delegate of the legislature has been entrusted with the
authority to issue such a notification. That does not make the
notification an Act of Parliament. [Para 42]
3.4. The mere fact that a piece of delegated legislation has
been issued in exercise of a legislatively conferred power does
not bring the delegated legislation within the ambit of the phrase
"Central Act" as defined in Section 3(7) of the General Clauses
Act. [Para 43]
3.5. Notification 05/2019 was issued by the Central
Government under the delegated authority to increase emergency
tariff duties under Section 8A of the Customs Tariff Act, 1975.
The notification has been issued in pursuance of a statutory power.
The notification has the effect of enhancing the rate of duty
prescribed in the First Schedule to the Customs Tariff Act. That
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does not transform the notification which has been issued in
pursuance of a statutory authority into a 'Central Act'. [Para 46]
4.1. While enacting the Information Technology Act, 2000,
Parliament envisioned a regime of electronic governance. The
legislation recognizes that information technology is a facilitative
instrument for creating an efficient framework for e-commerce.
[Para 47]
4.2. The rate of customs duty is determined on the date on
which the bill of entry for home consumption is presented (Section
15 of the Customs Act). The presentation of the bill of entry has
to be made electronically (Section 46 of the Customs Act read
with the 2018 Regulations). The presentation is required to be
made on the customs automated system. The provisions in the
Customs Act for the electronic presentation of the bill of entry
for home consumption and for self-assessment have to be read
in the context of Section 13 of the Information Technology Act
which recognizes "the dispatch of an electronic record" and "the
time of receipt of an electronic record". The legal regime
envisaging the electronic presentation of records, such as the
presentation of a bill of entry, has been imparted precision as a
result of the enabling framework of the Information Technology
Act under which these records are maintained. The presentation
of the bill of entry under Section 46 is made electronically and is
captured with time stamps in terms of the requirements of the
Information Technology Act read with Rule 5(1) of the Information
Technology (Electronic Service Delivery) Rules 2011. [Para 50]
4.3. Section 8 of the Information Technology Act, 2000
creates a legal basis for the publication of laws through e-gazettes.
On 30 September 2015, the Ministry of Urban Development
issued an Office Memorandum which discontinued the practice
of physical printing and replaced it with the electronic gazette.
[Paras 51, 52]
4.4. With the change in the manner of publishing gazette
notifications from analog to digital, the precise time when the
gazette is published in the electronic mode assumes significance.
Notification 5/2019, which is akin to the exercise of delegated
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legislative power, under the emergency power to notify and revise
tariff duty under Section 8A of the Customs Tariff Act, 1975, cannot
operate retrospectively, unless authorized by statute. In the era
of the electronic publication of gazette notifications and electronic
filing of bills of entry, the revised rate of import duty under the
Notification 5/2019 applies to bills of entry presented for home
consumption after the notification was uploaded in the e-Gazette
at 20:46:58 hours on 16 February 2019. [Para 58]
5.1. Section 8A of the Customs Tariff Act confers an
emergency power upon the Central government to increase
import duties "in respect of any article included in the first
schedule". The exercise of the power under Section 8A is
contingent on the satisfaction of the Central government that (i)
the duty on any article in the first schedule should be increased;
and (ii) that circumstances exist which render it necessary to
take immediate action. The Central government in the exercise
of this power may by a notification in the official gazette direct an
amendment of the schedule to be made "so as to provide for an
increase in the import duty leviable on such article to such extent
as it thinks necessary". Section 8A does not contain language
indicative of a legislative intent to authorize the Central
government to relate back the exercise of the power to a period
prior to its exercise. The exercise of the power under Section
8A (2) is governed by the prescriptions contained in sub-sections
(3) and (4) of Section 7. The conferment of the power has not
been made retrospective either expressly or by necessary
implication. [Para 62]
5.2. The entrustment of the power to issue a notification
enhancing the rate of duty under Section 8A is not accompanied
by a statutory entrustment of authority to the Central government
to exercise it with retrospective effect. An enhancement of the
rate of duty pursuant to the exercise of power under Section 8A
can only be prospective. [Para 63]
5.3. Parliament and the state legislatures are entrusted with
the power to enact legislation under Articles 245 and 246 of the
Constitution. Parliament and the state legislatures possess the
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plenary power to enact legislation, with prospective and
retrospective effect, subject to due observance of constitutional
requirements. A notification issued by the government pursuant
to the conferment of statutory power is distinct from an act of the
legislature. Administrative notifications, even when they are
issued in pursuance of an enabling statutory framework, are
subject to the statute. Delegated legislation does not lose its
character even when it has the same force and effect as if it is
contained in the statute. This is a settled position of law. [Para
64]
5.4. In empowering the Central Government to exercise
power under Section 8A of the Customs Tariff Act, Parliament
has not either expressly or by necessary implication indicated
that a notification once issued will have force and effect anterior
in time. The provisions of sub-sections (3) and (4) of Section 7 of
the Customs Tariff Act bring to bear legislative oversight and
supervision over the power which is entrusted to the Central
Government under Section 8A. That however does not lead to
the inference that a notification under Section 8A has retrospective
effect. Plainly, a notification enhancing the rate of duty under
Section 8A has prospective effect. A rule framed by the delegate
of the legislature does not have retrospective effect unless the
statutory provision under which it is framed allows retrospectivity
either by the use of specific words to that effect or by necessary
implication. [Para 64]
5.5. The fact that the rules had been framed in pursuance
of a resolution passed by the legislature or that they have to be
placed on the table of the legislative body would not lead to an
inference that the legislature had authorized the framing of
subordinate legislation with retrospective effect. This precisely
is the principle which applies in construing whether the power
which is conferred by Section 8A of the Customs Tariff Act is
retrospective. The provisions of sub-sections (3) and (4) of Section
7, which are made applicable by sub-section (2) of Section 8A,
are to ensure Parliamentary oversight. But that does not enable
the Central Government to exercise the power under section 8A
with retrospective effect. [Para 65]
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6.1.The imposition of a tax encompasses three stages.
There is, first, the declaration of liability which determines "what
persons in respect of what property are liable". The second is
the stage of assessment. Liability, it is well settled, does not
depend on assessment since ex-hypothesi, that has already been
fixed. Assessment particularizes the exact sum which a person is
liable to pay. Third (and the last) are the methods of recovery if a
person who is taxed does not voluntarily pay. [Para 66]
6.2. In the present case the twin conditions of Section 15 of
the Customs Act, 1962 stood determined prior to the issuance of
Notification 5/2019 on 16 February 2019 at 20:46:58 hours. The
rate of duty was determined by the presentation of the bills of
entry for home consumption in the electronic form under Section
46. Self-assessment was on the basis of rate of duty which was in
force on the date and at the time of presentation of the bills of
entry for home consumption. This could not have been altered in
the purported exercise of the power of re-assessment under
Section 17 or at the time of the clearance of the goods for home
consumption under Section 47. The rate of duty which was
applicable was crystallized at the time and on the date of the
presentation of the bills of entry in terms of the provisions of
Section 15 read with Regulation 4(2) of the Regulations of 2018.
The power of reassessment under Section 17(4) could not have
been exercised since this is not a case where there was an
incorrect self-assessment of duty. The duty was correctly assessed
at the time of self-assessment in terms of the duty which was in
force on that date and at the time. The subsequent publication of
the notification bearing 5/2019 did not furnish a valid basis for
re-assessment. [Para 67]
Union of India v. Param Industries Limited (2016) 16
SCC 692 and New Bank of India Employees' Union v.
Union of India (1996) 8 SCC 407 : [1996] 3 SCR 322
- distinguished.
Chief Inspector of Mines v. Lala Karam Chand Thapar
AIR 1961 SC 838 : [1962] 1 SCR 9; K I Shepard v.
Union of India (1987) 4 SCC 431 : [1988] 1 SCR 188;
Hukum Chand v. Union of India (1972) 2 SCC 601 :
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[1973] 1 SCR 896 ; Regional Transport Officer,
Chittoor v. Associated Transport Madras (1980) 4 SCC
597 : [1981] 1 SCR 627 ; Federation of Indian Minerals
Industries v.Union of India (2017) 16 SCC 186: [2017]
12 SCR 724 ; State of Rajasthan v. Basant Agrotech
(India) Ltd. (2013) 15 SCC 1 : [2013] 17 SCR 395; A
V Fernandez v. State of Kerala [1957] SCR 837 and
Deputy CTO v. Sha Sukraj Peerajee [1967] 3 SCR 661
- relied on.
Bharat Surfactants (Private) Limited v. Union of India
(1989) 4 SCC 21:[1989] 3 SCR 367; Priyanka
Overseas Pvt. Ltd. v. Union of India 1991 Supp (1) SCC
102:[1990] 3 Suppl. SCR 138; Dhiraj Lal H Vohra v.
Union of India 1993 Supp (3) SCC 453: [1992] 3 Suppl.
SCR 494; D.C.M. v. Union of India 1995 Supp (3) SCC
223; Raj Kumar Yadav v. Samir Kumar Mahaseth (2005)
3 SCC 601: [2005] 2 SCR 670; New India Assurance
Co. Ltd. v. Ram Dayal (1990) 2 SCC 680:[1990] 2
SCR 570; National Insurance Company Limited v. Geeta
Devi (2010) 15 SCC 670; Ahmadsahab Abdul Mulla
(2) Dead by proposed Lrs. v. Bibijan (2009) 5 SCC
462: [2009] 5 SCR 476; Pashupati Nath Singh v.
Harihar Prasad Singh [1968] 2 SCR 812; Video
Electronics (P) Ltd v. State of Punjab (1990) 3 SCC
87:[1989] 2 Suppl. SCR 731; TN Electricity Board v.
Status Spinning Mills Limited (2008) 7 SCC 353:[2008]
9 SCR 870; Kolhapur Canesugar Works Ltd. v. Union
of India (UOI) AIR 2000 SC 811 : [2000] 1 SCR 518;
Securities and Exchange Board of India v. Magnum
Equity Services Ltd. (2015) 16 SCC 721; M.D. Overseas
Industries v. Union of India W.P. (C) 7838/2017 decided
on 15 October 2019 (Delhi High Court); Ruchi Soya
Industries v. Union of India W.P. No. 21207 of 2018
decided on 14 July 2020 (Madras High Court); Param
Industries Ltd. v. Union of India 2002 (150) E.L.T. 3
(Kar); Pankaj Jain Agencies v Union of India (1994) 5
SCC 198:[1994] 1 Suppl. SCR 602; and Union of India
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v. Ganesh Das Bhojraj (2000) 9 SCC 461:[2000] 1
SCR 1081 - referred to.
Re Court Fees ILR (1923) 46 Mad 685 and Chatturam
v. CIT, Bihar (1947) FCR 116 (66) - referred to.
Whitney v. Commissioners of Inland Revenue (1926) AC
37 - referred to.
HELD (per K.M. Joseph, J.) [Concurring]:
1. The Notification which came to be issued late in the
evening on 16.02.2019 was admittedly issued under Section 8A
of the Tariff Act. It is a species of delegated legislation. It is only
with the publication effected at 20:46:58 hrs. on 16.02.2019, the
Notification issued under Section 8A, increasing the rate of import
duty, came into force. [Paras 30, 33]
2.1. The notification issued under Section 8A of the Tariff
Act is not made by Central Legislature, namely, the Parliament.
The notification is also not a regulation as defined in General
Clauses Act. There is no merit in the contention that by virtue of
Section of 5(3) of the General Clauses Act, the notification must
be treated as effective from the point of time immediately after
mid night on 15/16 February, 2019. [Para 60]
2.2. Generally, the law frowns upon determining a day with
reference to its fractions. Undoubtedly, in the case of Central
Act or a Regulation, the principle is statutorily incorporated in
Section 5(3), that unless a contrary intention appears, it begins
its journey in the Statute Book from the first point of time past
the stroke of the previous midnight. Section 5(3) does not apply
to the notification which is a form of delegated legislation. [Para
68]
3.1. The law which is made by the legislature is to be treated
differently from delegated legislation. A law if made by Parliament
including a change in the rate of duty in the Customs-Tariff Act
would involve a process which is attended by a certain level of
publicity. [Para 75]
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3.2. There is a process and time involved in Parliament
which is unlike what happens in the case of a delegated legislation
of the sort in particular, projected in these cases, namely, a
notification issued by the executive under Section 8A. It is on
this basis that the law made by the legislature is taken as known
to the public and mere assent of the President would suffice and
the need to make any delegated legislation known by publication
before it becomes effective is insisted upon. Publication in the
case of delegated legislation is based on a rationale. [Para 75]
4. In the context of the Customs Act, and having regard to
the Scheme, which, in the case of import duty, consists of filing of
Bill of Entry for home consumption, self-assessment and payment
of duty on the basis of the same and the rate being clearly fixed
with reference to the particular point of time when the Bill of
Entry is presented and there is a deemed presentation and even
a deemed assessment, which is otherwise in order, and bearing
in mind the principle that Section 8A of the Customs Tariff Act,
1975 does not provide power for increase of rate of duty with
retrospective effect, the Notification must be treated as having
coming into force not before its publication which is at 20:46:58
hrs. on 16.02.2019. This would necessarily mean that the
Notification cannot be used to alter the rate of duty on the basis
of which, in fact, there was presentation of Bill of Entry several
hours ago, the self-assessment was done and what is more, the
self-assessment was completed under Regulation 4(2) of the 2018
Regulations. There cannot be reassessment. The interpretation
based on time of publication is in harmony with a view that accords
respect for vested rights. [Para 78]
5. Once it is found that the notification upon publication
would take effect from the time of its publication then in regard
to the bills of entries which stand presented within the meaning
of Section 46 of the Customs Act read with 4(2) of the 2018
Regulations, earlier to such publication, the rate of duty in regard
to the same would be only the rate of duty which prevailed at the
time of the deemed presentation under Regulation 4(2) of the
Bill of Entry (Electronic Integrated Declaration and Paperless
Processing) Regulations, 2018. [Para 79]
UNION OF INDIA & ORS. v. M/S G S CHATHA RICE MILLS & ANR.
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6. While the expression "otherwise" in Section 17(4) of
the Customs Act, 1962, may be capable of taking care of situations
which are not covered by the preceding expressions, viz.,
verification, examination, attesting of the goods, it cannot mean
that it will empower the Officer to alter the rate of duty which is
prevalent at the time of the self-assessment following the due
presentation of the Bill of Entry. If it is otherwise, it will be open
to the Department to reopen cases of concluded assessments by
virtue of the deemed completion of assessment under Regulation
4(2) without any legal justification. That would be plainly
impermissible being illegal. [Para 80]
7. By its very nature, delegated legislation is legislative in
character but if it is to be a Central Act within the meaning of
Section 5 of General Clauses Act, it must be made by the
legislature. Delegated legislation which is called administrative
legislation in England, is exercise of legislative power by the
executive. The fact that the notification issued under Section 8A
is in the exercise of its legislative power or that it may have to be
read in the same manner as if it is a part of the Act, will not detract
the Court from ascertaining as to who is the author of the exercise
of the legislative power, namely, whether it is an exercise of power
by the legislature or by its delegate. Upon answer to the question,
namely, that the author of the legislative effort is the executive,
the question would necessarily arise as to whether there is
publication. In the scheme of the Customs Act, the Tariff Act and
the 2018 Regulations, the time at which the notification under
Section 8A is published would indeed have relevance. [Para 85]
M/s. Bharat Surfactnts (P) Ltd. v. Union of India 1989
(4) SCC 21: [1989] 3 SCR 367; Priyanka Overseas
(P) Ltd. v. Union of India 1991 Suppl. (1) SCC 102:
[1990] 3 Suppl. SCR 138; Dhiraj Lal H. Vohra v. Union
of India 1993 Suppl. (3) SCC 453:[1992] 3 Suppl.
SCR 494; D.C.M. Ltd. and Another v.. Union of India
1995 Suppl. (3) SCC 223; Ahmadsahab Abdul Mulla
(2) (Dead) By Proposed LRs. v. Bibijan and others 2009
(5) SCC 462: [2009] 5 SCR 476; and Government of
Andhra Pradesh and Another v. Hindustan Machine
Tools Ltd. 1975 (2) SCC 274: [1975] SCR 394 -
distinguished.
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Collector of Central Excise v. New Tobacco Company
and others (1998) 144 CTR (SC) 618 - held not good
law.
Union of India and others v. Ganesh Das Bhojraj 2000
(9) SCC 461:[2000] 1 SCR 1081- held applicable.
I.T.C. Bhadrachalam Paperboards and another v.
Mandal Revenue Officer andothers (1996) 6 SCC 634:
[1996] 5 Suppl. SCR 643; B.K. Srinivasan v. State of
Karnataka (1987) 1 SCC 658: [1987] 1 SCR 1054;
and M/s. Pankaj Jain Agencies v. Union of India and
others (1994) 5 SCC 198: [1994] 1 Suppl. SCR 602 -
relied on.
Asia Tobacco Company Limited v. Union of India and
others (1985)155 ITR 568 (Mad); In Re: Court Fees
AIR 1924 Madras 257; Jasbir Singh v. Union of India
(1995) ILR 2 Delhi 399; New India Assurance Company
Limited v. Ram Dayal and Others (1990) 2 SCC
680:[1990] 2 SCR 570; Oriental Insurance Company
Limited v. Porselvi and Another 1997 (1) SCC 66:
[1996] 8 Suppl. SCR 929; Oriental Insurance Company
Limited v. Sunita Rathi and Others 1998 (1) SCC
365:[1997] 6 Suppl. SCR 200; National Insurance
Company Limited v. Geeta Devi and Others 2010 (15)
SCC 670; Raj Kumar Yadav v. Samir Kumar Mahaseth
2005 (3) SCC 601: [2005] 2 SCR 670; Vikram Singh
alias Vicky and Another v. Union of India and Others
2015 (9) SCC 502: [2015] 10 SCR 816; The Video
Electronics Pvt. Ltds and Another v. State of Punjab
and Another 1990 (3) SCC 87:[1989] 2 Suppl.
SCR 731; Tamil Nadu Electricity Board and Another v.
Status Spinning Mills Limited and Another 2008(7) SCC
353: [2008] 9 SCR 870 - referred to.
Johnson v. Sargant & Sons 1917 1 K.B. 101; Lester v.
Garland [1808] 15 Ves. 248; Re. Railways Sleepers
Supply Co. (1885) 29 Ch.d. 204; and In Re. North
(1895) 2 Q.B. 264 - referred to.
UNION OF INDIA & ORS. v. M/S G S CHATHA RICE MILLS & ANR.
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Case Law Reference
In
the
judgment
of
Dr.
DHANANJAYA
Y
CHANDRACHUD, J. [for himself and INDU MALHOTRA, J.]
(2016) 16 SCC 692
distinguished
Para 11(vi)
[1989] 3 SCR 367
referred to
Para 25
[1990] 3 Suppl. SCR 138
referred to
Para 25
[1992] 3 Suppl. SCR 494
referred to
Para 25
1995 Supp (3) SCC 223
referred to
Para 25
[2005] 2 SCR 670
referred to
Para 27
[1990] 2 SCR 570
referred to
Para 28
(2010) 15 SCC 670
referred to
Para 29
[2009] 5 SCR 476
referred to
Para 30
[1968] 2 SCR 812
referred to
Para 31
[1989] 2 Suppl. SCR 731
referred to
Para 37
[2008] 9 SCR 870
referred to
Para 37
[2000] 1 SCR 518
referred to
Para 44
(2015) 16 SCC 721
referred to
Para 45
(2016) 16 SCC 692
referred to
Para 59
[1994] 1 Suppl. SCR 602
referred to
Para 60
[2000] 1 SCR 1081
referred to
Para 60
[1962] 1 SCR 9
relied on
Para 64
[1988] 1 SCR 188
relied on
Para 64
[1996] 3 SCR 322
distinguished
Para 64
[1973] 1 SCR 896
relied on
Para 64
[1981] 1 SCR 627
relied on
Para 65
[2017] 12 SCR 724
relied on
Para 65
[2013] 17 SCR 395
relied on
Para 65
[1967] 3 SCR 661
relied on
Para 66
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B
C
D
E
F
G
H
587
In the judgment of K M JOSEPH, J.
[1996] 5 Suppl. SCR 643
relied on
Para 31
[1987] 1 SCR 1054
relied on
Para 32
[1994] 1 Suppl. SCR 602
relied on
Para 33
(1998) 144 CTR (SC) 618
held not good law
Para 34
[2000] 1 SCR 1081
held applicable
Para 36
[1990] 2 SCR 570
referred to
Para 55
[1996] 8 Suppl. SCR 929
referred to
Para 56
[1997] 6 Suppl. SCR 200
referred to
Para 56
(2010) 15 SCC 670
referred to
Para 56
[1989] 3 SCR 367
distinguished
Para 81
[1990] 3 Suppl. SCR 138
distinguished
Para 81
[1992] 3 Suppl. SCR 494
distinguished
Para 81
(1995) Suppl. 3 SCC 223
distinguished
Para 81
[2005] 2 SCR 670
referred to
Para 82
[2009] 5 SCR 476
distinguished
Para 82
[1968] 2 SCR 812
referred to
Para 83
[2015] 10 SCR 816
referred to
Para 84
[1975] SCR 394
distinguished
Para 84
[1989] 2 Suppl. SCR 731
referred to
Para 85
[2008] 9 SCR 870
referred to
Para 85
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3249
of 2020
From the Judgment and Order dated 26.08.2019 of the High Court
of Punjab and Haryana at Chandigarh in CWP No. 18460/2019.
With
Civil Appeal No. 3250 of 2020, 3251 of 2020, 3252 of 2020, 3253
of 2020, 3254 of 2020, 3255 of 2020, 3256 of 2020, 3257 of 2020, 3258 of
2020, 3259 of 2020, 3260 of 2020, 3261 of 2020, 3262 of 2020, 3263 of
UNION OF INDIA & ORS. v. M/S G S CHATHA RICE MILLS & ANR.
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2020, 3264 of 2020, 3265 of 2020, 3266 of 2020, 3267 of 2020, 3268 of
2020, 3269 of 2020, 3270 of 2020, 3271 of 2020, 3272 of 2020, 3273 of
2020, 3274 of 2020, 3275 of 2020, 3276 of 2020, 3277 of 2020, 3278 of
2020 and 3279 of 2020.
K.M. Natraj, Sanjay Jain, ASGs, P.S. Narasimha, Sr. Adv, K.K.
Tyagi, Sarvam Ritam Khare, Mrs. B. Sunita Rao, Merusagar samantray,
B. Krishna Prasad, Ms. Anjana Gusain, Anant Agrawal, Ms. Sweta
Rani, Devashish Bharuka, Ravi Bharuka, Mrs. Jaya Bharuka, Ms.
Sarvshree, Justin George, Ms. Sishti Agarwal, Saurabh Kapoor,
Parmatma Singh, Mayank Jain, Madhur Jain, Aditi Tripathi, Sarvshree
Singh, Sarvam Ritam Khare, Advs. for the appearing parties.
The Judgment of the Court was delivered by
DR. DHANANJAYA Y CHANDRACHUD, J.
This judgment has been divided into sections to facilitate analysis.
They are:
A
The aftermath of Pulwama
B
The backdrop
C
Petitions before the High Court
D
The judgment of the High Court
E
Submissions in the appeals
F
Determination of the rate under Section 15 of the Customs
Act 1962
G
Precedent
H
Interpreting 'day' and 'date'
I
Notification under Section 8A of the Customs Tariff Act
J
General Clauses Act
K
Information Technology Act, 2000
L
Effect of notifications issued in e-gazettes
M
Retrospectivity
N
Summation
1. Leave granted.
A The aftermath of Pulwama
2. A terrorist attack took place at Pulwama on 14 February 2019.
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On 16 February 2019, the Union Government issued a notification under
Section 8A of the Customs Tariff Act 1975. The notification introduced
a tariff entry by which all goods originating in or exported from the
Islamic Republic of Pakistan were subjected to an enhanced customs
duty of 200%. The precise time at which the notification was uploaded
on the e-Gazette was 20:46:58 hours. Customs authorities at the land
customs station at Attari sought to enforce the enhanced rate of duty on
importers who had already presented bills of entry for home consumption
before the enhanced rate was notified in the e-Gazette. Their action led
to a challenge before the High Court of Punjab and Haryana. The
consignments of import covered a diverse range of goods, ranging from
dry dates to cement.
3. On 26 August 2019, a Division Bench of the High Court of
Punjab and Haryana allowed a batch of writ petitions under Article 226
of the Constitution. The High Court held that since the importers, who
had imported goods from Pakistan, had presented their bills of entry and
completed the process of "self- assessment" before the notification
enhancing the rate of duty to 200 per cent was issued and uploaded, the
enhanced rate of duty was not attracted. The High Court held that the
importers were liable to pay the duty applicable at the time when the
bills of entry for home consumption were filed under Section 46 of the
Customs Act, 1962.1 The Union of India was ordered to release the
goods within seven days on the payment of duty 'as declared and assessed'
without applying the notification enhancing the rate of duty on goods
originating in Pakistan.
4. The Union of India is in appeal.
5. The judgment of the High Court is titled as Rasrasna Food
Private Limited versus Union of India. Chronologically, the first petition
listed before this Court by Special Leave under Article 136 of the
Constitution is in the case of G S Chatha Rice Mills. Since the issues of
law which have been raised are common to the batch of appeals, they
have been heard together.
B The backdrop
6. The First respondent is a partnership firm based in Amritsar
which is, inter alia, engaged in the import of cement. It imported a
1 "the Customs Act"
UNION OF INDIA & ORS. v. M/S G S CHATHA RICE MILLS & ANR.
[DR. DHANANJAYA Y CHANDRACHUD, J.]
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consignment of fourteen hundred bags of cement from Pakistan under
an invoice dated 1 February 2019. A truck bearing registration number
TLV-189 (cargo) crossed the 'zero line' on Saturday, 16 February 2019
under entry number 47195 with a Pakistan Custom's Cargo Manifest
bearing the time of 4:31 pm. The goods arrived at the Land Customs
Station Road Cargo, Attari Road, Amritsar on the same day and IGM
number 366870 was filed in respect of the goods. The truck unloaded its
cargo at the Central Warehousing Corporation, ICP, Attari. The arrival
of the goods and the filing of the IGM was before 18:00 hours on 16
February 2019. The First respondent filed bill of entry number 2083178
dated 16 February 2019 seeking clearance of the goods for home
consumption.