Union Of India vs M/S G.S. Chatha Rice Mills on 23 September, 2020


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Supreme Court of India

Union Of India vs M/S G.S. Chatha Rice Mills on 23 September, 2020

Author: Hon’Ble Dr. Chandrachud

Bench: Hon’Ble Dr. Chandrachud, Hon’Ble Ms. Malhotra, K.M. Joseph

                                                                               Reportable




                             IN THE SUPREME COURT OF INDIA
                                  CIVIL APPELLATE JURISDICTION




                                 Civil Appeal No 3249 of 2020
                            (Arising out of SLP(C) No 3860 of 2020



          Union of India & Ors.                                           …Appellants



                                             Versus

          M/S G S Chatha Rice Mills & Anr.                               …Respondents




                                             WITH

                                  Civil Appeal No 3250 of 2020
                             (Arising out of SLP (C) No.3861 of 2020)


                                             WITH


                                   Civil Appeal No 3250 of 2020
                             (Arising out of SLP (C) No.3869 of 2020)

                                             WITH


                                   Civil Appeal No 3252 of 2020
                             (Arising out of SLP (C) No.3867 of 2020)

Signature Not Verified                       WITH
Digitally signed by
ARJUN BISHT
Date: 2020.09.23
17:17:31 IST
Reason:

                                  Civil Appeal No 3253 of 2020
                              (Arising out of SLP (C) No.3865 of 2020)


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      Civil Appeal No 3262 of 2020
 (Arising out of SLP (C) No.5029 of 2020)



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 (Arising out of SLP (C) No.7059 of 2020)



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 (Arising out of SLP (C) No.6451 of 2020)



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(Arising out of SLP (C) No.7063 of 2020)



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(Arising out of SLP (C) No.7064 of 2020)



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(Arising out of SLP (C) No. 7057 of 2020)



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      Civil Appeal No 3272 of 2020
 (Arising out of SLP (C) No.5920 of 2020)



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      Civil Appeal No 3273 of 2020
  (Arising out of SLP (C) No.7065 of 2020)



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     Civil Appeal No 3274 of 2020
(Arising out of SLP (C) No.7066 of 2020)



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(Arising out of SLP (C) No.7067 of 2020)



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(Arising out of SLP (C) No.6189 of 2020)



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      Civil Appeal No 3277 of 2020
(Arising out of SLP (C) No.7543 of 2020)



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       Civil Appeal No 3278 of 2020
(Arising out of SLP (C) No.6683 of 2020)

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      Civil Appeal No 3279 of 2020
(Arising out of SLP (C) No.7068 of 2020)



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 (Arising out of SLP (C) No.5036 of 2020)



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      Civil Appeal No 3264 of 2020
(Arising out of SLP (C) No.5823 of 2020)



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      Civil Appeal No 3256 of 2020
 (Arising out of SLP (C) No.4960 of 2020)



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      Civil Appeal No 3254 of 2020
  (Arising out of SLP (C) N0.4959 of 2020)



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      Civil Appeal No 3255 of 2020
 (Arising out of SLP (C) No. 4961 of 2020)



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      Civil Appeal No 3260 of 2020
 (Arising out of SLP (C) No.5822 of 2020)




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     Civil Appeal No 3257 of 2020
(Arising out of SLP (C) No.5033 of 2020)




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    Civil Appeal No 3258 of 2020
(Arising out of SLP (C) No. 5821 of 2020)



                WITH

     Civil Appeal No 3261 of 2020
(Arising out of SLP (C)No. 7058 of 2020)



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    Civil Appeal No 3263 of 2020
(Arising out of SLP (C) No. 5028 of 2020)



                WITH

     Civil Appeal No 3266 of 2020
(Arising out of SLP (C) No.7061 of 2020)



                 AND

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        Civil Appeal No 3268 of 2020
   (Arising out of SLP(C) No.7062 of 2020)




                   5
                                 JUDGMENT




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




                                         6
                                                                             PART A




1     Leave granted.


A     The aftermath of Pulwama


2     A terrorist attack took place at Pulwama on 14 February 2019. 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



                                         7
                                                                          PART A


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




                                        8
                                                                              PART B


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 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. The bill of entry was self-

1 “the Customs Act”

                                           9
                                                                                     PART B


assessed at 18:08 hours under the provisions of Section 17(1) of the Customs

Act 19622 under Customs Tariff Heading 2523910 by levying nil customs duty in

terms of notification 68/2012 dated 31 December 2012 (as amended by

notification 50/2017- serial 129 dated 30 June 2017) and IGST at 28 percent rate

(in terms of notification 1/2017- schedule III serial No. 3). The duty payable was

assessed at Rs 73,342/-. Notification 50/2017-Cus (serial No. 129), prescribed a

preferential rate of duty on specified goods originating in the Islamic Republic of

Pakistan.


On 16 February 2019, notification 5/2019 was issued by the Ministry of Finance

in the Department of Revenue, in exercise of powers conferred by sub-section (1)

of Section 8A of the Customs Tariff Act 1975. 3 By this notification, a new tariff

entry was introduced in Chapter 98 of Section XXI in the following terms:

(1)                   (2)                                    (3)       (4)     (5)
“9806 00 00           All goods originating in or exported         -   200 %         -”.

                      from   the   Islamic   Republic   of

                      Pakistan


The notification contains a reference to the date (16 February 2019) and time

(20:46:58) at which it was uploaded and published in the e-Gazette of the

Government of India. Based on the enhancement in the rate of duty brought

about by the notification, the customs authorities refused to release the goods

which were assessed earlier. The bill of entry was recalled and reassessed on 20




2 “the Customs Act”
3 “the Customs Tariff Act”

                                                  10
                                                                              PART C


February 2019 at 18:14 hours by levying customs duty at 200 per cent and IGST

at 28 per cent, enhancing the duty from Rs 73,342/- to 8,10,952/-.




7           Aggrieved by the action of the customs authorities, the first respondent

filed a petition under Article 226 for setting aside (i) the assessment of the bill of

entry to a duty of 200%; (ii) Notification 5/2019 dated 16 February 2019; and for a

direction to CWC to issue a detention memo and the release of the goods.




C           Petitions before the High Court


8           The batch of petitions before the High Court involved cases of other

similarly situated importers. The facts pertaining to the writ petitions, as gleaned

from the judgment of the High Court, are summarized below:
   (i)    the goods were imported in the ordinary course of trade from Pakistan;
   (ii)   the goods entered Indian territory through the Attari border at Amritsar

               before 18:00 hours on 16 February 2019;
    (iii)      the importers had filed bills of entry under Section 46 of the Customs

               Act, before the close of working hours, seeking clearance of the goods

               for home consumption;
    (iv)       the value and description of the goods were declared;
    (v)        the importers had self-assessed the goods in terms of the prevailing

               notifications and had filed the bills of entry in the EDI system;
    (vi)       the declarations were subject to verification by the customs department

               which did not dispute them and generated duty payment TR-6 challans;
    (vii)      since 16 February 2019 was a Saturday, the customs’ office was closed

               after 18:00 hours and was to open on Monday,18 February 2019;
    (viii)     some of the importers paid the duty online through TR-6 challans on 16

               February 2019 while in the case of others, the payment of duty was in

               progress;

                                            11
                                                                              PART C


    (ix)      Notification 5/2019 was issued at 20:46:58 hours on 16 February 2019

              following the Pulwama terrorist attack as a result of which the rate of

              duty on goods originating in Pakistan was enhanced to 200 per cent

              irrespective of the fact that some of the products had hitherto been

              exempt from customs duty; and
    (x)       the customs authorities refused to release the goods on the basis of the

              bills of entry which were self-assessed at the pre-existing rate and

              proceeded to recall them and re-assess the goods to the enhanced rate

              of duty applicable under notification 5/2019.

9          Before the High Court, the submission of the importers was that before

notification 5/2019 was issued (at 20:46 hours on 16 February 2019 in order to

discourage the import of goods from Pakistan), (i) they had placed orders; (ii) the

goods had entered into the territory of India; (iii) the goods were fully or partially

exempt from basic customs duties, but subject to IGST at the time of the filing of

the bills of entry; (iv) the exporters from Pakistan received payment of the

consideration on the basis of which the goods had been supplied; and (v) the

object of the notification was to discourage imports from Pakistan and not to

penalize Indian importers who had placed orders and had imported goods into




                                             12
                                                                                 PART D


India, bona fide relying on the policy which was applicable before the notification

was issued in the late hours of the day. On the issues of law, it was urged that

after the presentation of the bills of entry for home consumption, self-assessment

and duty payment challans had been generated, it was not open to the customs

authorities to levy the enhanced rate of duty which came into force later, from

20:46 hours on 16 February 2019. The application of notification 5/2019 would, it

was urged, have retrospective effect since the bills of entry for home

consumption had been filed electronically on the customs’ automated platform

before the issuance of the notification and they were self-assessed.




10    On the other hand, the contention of the Union government before the

High Court was that under Section 15 of the Customs Act, 1962 the relevant date

for determining the rate of duty is the date of the presentation of the bill of entry.

The submission was that the amended rate of duty under notification 5/2019

came into force on 16 February 2019; hence, the importers were liable to pay

duty on the basis of the amended rate. The submission was that the customs

authorities were entitled to re-assess the bills of entry under Section 17(4).




D     The judgment of the High Court


11    The High Court, after analyzing the provisions of Sections 8A and 11A of

the Customs Tariff Act, 1975 and Sections 12, 15, 17, 46 and 47 of the Customs

Act,1962 held that:




                                         13
                                                                                 PART D


(i)     The relevant date for the determination of duty is the date of the

        presentation of the bill of entry, which, in the facts of this case, corresponds

        to the date of the entry of the vehicle carrying the goods into India;


(ii)    The bills of entry were presented on 16 February 2019 before the issuance

        of notification 5/2019;


(iii)   The dual requirements of Section 15 namely, the filing of the bill of entry

        and the entry of the vehicle were fulfilled before the publication of

        notification 5/2019;


(iv)    The amended rate of duty was not applicable;


(v)     The absence of customs’ clearance under Section 47 had no bearing on

        the rate applicable;


(vi)    Notification 5/2019 having been released after working hours, it would

        apply from the next day as held in the decision of this Court in Union of

        India vs. Param Industries Limited4; and


(vii)   A notification under Section 8A of the Customs Tariff Act, 1975 cannot

        apply retrospectively.




4 (2016) 16 SCC 692

                                           14
                                                                                 PART E


12      The Union of India is in appeal.




E       Submissions in the appeals


13      Besides making oral submissions, Mr K M Natraj, Additional Solicitor

General of India has filed written submissions. His submissions are prefaced with

a delineation of the issue which is raised in the appeals, which is:

               “…whether the amendment to the First Schedule of the
               Customs Tariff Act, 1975 takes effect from the time at which it
               is uploaded / notified in the gazette or from the first moment
               of the day / date on which it was issued/ published in the
               gazette.”



The submissions of the ASG are summarized below:


A (i) Under Section 15 of the Customs Act, the date for the determination of the

        rate of duty and valuation of imported goods, in the case of goods which

        are entered for home consumption under Section 46, is the date on which

        the bill of entry in respect of the goods is presented. The expression “on

        the date” comprehends the entire period of 24 hours, in this case

        beginning at midnight on 16 February 2019;


 (ii)   Section 15 does not make any reference to time and hence, irrespective of

        the point of time when a notification has been uploaded or published in the

        e-Gazette, the rate of duty leviable on imported goods cleared for home

        consumption is, by a legal fiction, the rate prevalent on the date of the

        presentation of the bill of entry;




                                               15
                                                                              PART E


(iii)   Section 15 should be interpreted in light of the rule of literal construction,

        and the law has to be applied as it is; and


(iv)    This case is not about the prospective or retrospective application of the

        Notification at issue. Rather, it is the simple intent of Parliament to

        consciously make the date on which the Notification is issued as the date

        for determination of the rate of duty (as applicable), which this court must

        uphold.


B (i) Independent of (A) above, a notification under Section 8A(1) of the

        Customs Tariff Act has the effect of amending the First schedule and is a

        legislative act which dates back to the commencement of the day;


   (ii) The schedule is a part of the Act, and hence an amendment to it is an

        amendment to the Act;


   (iii) Sub-section (2) of Section 8A of the Customs Tariff Act applies the

        provisions of sub-sections (3) and (4) of Section 7 to a notification which is

        issued under Section 8A(1);


   (iv) A notification under Section 8A(1) amending the first schedule has to be

        placed before each House of Parliament and is subject to its approval and

        modification; and


    (v) An amendment to the schedule, upon the exercise of powers under

        Section 8A, constitutes an amendment of the Act itself which passes

        through a process of receiving Parliamentary sanction and is subject to its

        approval.


                                          16
                                                                           PART E


C (i) In view of (B) above, since the schedule to the Customs Tariff Act is a part

        of the enactment, the provisions of the General Clauses Act 1897 5 are

        attracted to an amendment effected under section 8A(1);


  (ii) Section 3(7) of the General Clauses Act defines the expression ‘Central

        Act’ to mean an Act of Parliament while Section 3(13) defines

        ‘commencement’ to mean the day on which an Act or Regulation comes

        into force;


  (iii) Under Section 5(3) of the General Clauses Act, a Central Act or

        Regulation, unless the contrary is expressed, comes into force immediately

        on the expiration of the day preceding its commencement; and


  (iv) ‘Commencement’ can only be from a day which takes within its fold the

        entire period of 24 hours from midnight of the day before the issuance of

        the notification.


D       The twin requirements of Section 15 are fulfilled because


 (i)    The notification was issued and uploaded in the Gazette on 16 February

        2019; and
 (ii)   The bills of entry for home consumption under Section 46 were presented

        on 16 February 2019.


This is the substratum of the plea that the rate of duty prescribed by notification

5/2019 is applicable.


14      Opposing the above submissions, Mr PS Narasimha, learned Senior

Counsel submitted that

5 “the General Clauses Act”

                                         17
                                                                              PART E


A (i)   The levy of customs duty under Section 12 of the Customs Act is at the

        rates prescribed under the Customs Tariff Act;


  (ii) Under Section 15 of the Customs Act, the rate of duty is the rate prevalent

        on the date of the presentation of the bill of entry under section 46 of the

        Customs Act, where goods are cleared for home consumption; and


  (iii) The importers fulfilled the twin requirements of the goods having entered

        on 16 February 2019 and the bill of entry having been filed before 20:46

        hours when notification 5/2019 was issued. The bills of entry had to be

        assessed to customs duty at the rate which was in existence prior to the

        publication of the notification.


B (i) Notification 5/2019 having been published at 20:46:58 hours on 16

        February 2019 it was never updated on the EDI portal;


  (ii) Notification 5/2019 would apply only to bills of entry for home consumption

        presented after 20:46:58 hours on 16 February 2019 or upon amendment

        in the online EDI portal of ICEGATE;


  (iii) A notification issued under the provisions of Section 8A (1) of the Customs

        Tariff Act cannot have a retrospective character; and


  (iv) Subordinate legislation is not retrospective unless the statute under which

        it has been framed, expressly or by necessary implication, imports

        retrospectivity. Subordinate legislation cannot always be equated as an

        ‘Act of legislature’ for the interpretation of ‘Central Act’ as defined by the

        General Clauses Act.


                                           18
                                                                              PART E


C (i) Digital India is a new vision and idea into which India is evolving, and we

         are in a phase of governance in which multiple commercial transactions

         take place every single day. Rule 5(1) of the Information Technology

         (Electronic Service Delivery) Rules, 2011 mandates maintenance of

         timestamps for any governmental electronic records;


  (ii)   In exercise of the powers conferred by Section 157 read with Sections 46

         and 47 of the Customs Act, the Central Board of Indirect Taxes and

         Customs has passed the Bill of Entry (Electronic Integrated Declaration

         and Paperless Processing) Regulations 20186;


 (iii) Under Regulation 4(2), the bill of entry is deemed to have been filed and

         self-assessment completed when, after the entry of the electronic

         integrated declaration on the customs automated system, a bill of entry is

         generated by the Indian Customs Electronic Data Interchange System and

         the self-assessed copy of the bill of entry may be electronically transmitted

         to the authorized person;


  (iv) In terms of the provisions of Section 15(1)(a), where goods are entered for

         home consumption under Section 46, the rate of duty is the rate in force on

         the date on which a bill of entry in respect of such goods is presented

         under Section 46. The Regulations of 2018 have been made pursuant to

         Section 46 and contain a deeming fiction which prescribes when the

         presentation of the bill of entry and self-assessment is complete;




6 “the Regulations 2018”

                                           19
                                                                             PART E


    (v) Once the bills of entry were filed and self-assessment was complete, the

        subsequent issuance of notification 5/2019 at 20:46:58 hours would have

        no application to the present batch of cases; and


    (vi) Bills of entry, once presented, can be re-assessed under Section 17(4) only

        in instances when the assessment has “not been done correctly” upon

        verification, examination or testing of the goods by the proper officer. None

        of these circumstances are applicable to the present case.


D       The purpose of the notification being to discourage the import of goods

from Pakistan, it has prospective effect: the object and purpose is not to penalize

Indian importers who had completed their imports, presented bills of entry for

home consumption and had completed self-assessment in terms of the

provisions of the Customs Act and the Regulations, prior to the issuance of the

notification.


The submissions which were urged by Mr P S Narasimha have been supported

by other learned counsel appearing for the respondents including Mr Devashish

Bharuka, Ms Anjana Gusain, Mr Anant Agrawal, Ms Sishti Agarwal, Mr Parmatma

Singh and Mr Saurabh Kapoor.




15      The rival submissions are considered below.




                                          20
                                                                                  PART F




F     Determination of the rate under Section 15 of the Customs Act 1962


16    Chapter V of the Customs Act provides for the levy of and exemption from

customs duties. Section 12(1), which is the charging provision, provides for the

levy of duties of customs on goods imported into, or exported from India at the

rates specified by the Customs Tariff Act or, in any other law for the time being in

force. Section 15(1) is extracted below:

             “15. Date for determination of rate of duty and tariff valuation
             of imported goods.— (1) The rate of duty and tariff
             valuation, if any, applicable to any imported goods, shall
             be the rate and valuation in force,—

             (a) in the case of goods entered for home consumption
             under section 46, on the date on which a bill of entry in
             respect of such goods is presented under that section;

             (b) in the case of goods cleared from a warehouse under
             section 68, on the date on which a bill of entry for home
             consumption in respect of such goods is presented under that
             section];

             (c) in the case of any other goods, on the date of payment of
             duty:

             Provided that if a bill of entry has been presented before the
             date of entry inwards of the vessel or the arrival of the aircraft
             or the vehicle by which the goods are imported, the bill of
             entry shall be deemed to have been presented on the date of
             such entry inwards or the arrival, as the case may be.

             The provisions of this section shall not apply to baggage and
             goods imported by post.”

                                                       (emphasis supplied)




                                               21
                                                                                 PART F


17      Section 12 specifies that the rates of duty on goods imported and exported

are those which are provided in the Customs Tariff Act or in any other law.

Section 12 does not indicate when the duties under those enactments will come

into being or force. Section 15 specifies the date with reference to which the rate

of duty and tariff valuation of imported goods is determined. Clauses (a), (b) and

(c) of sub-section (1) of section 15 contain distinct provisions which apply to:


(i)     goods entered for home consumption under Section 46;


(ii)    goods cleared from a warehouse under Section 68; and


(iii)   other goods.


Where goods are entered for home consumption under Section 46, the rate of

duty and tariff valuation is to be the rate and valuation “in force” “on the date on

which” a bill of entry in respect of such goods is presented under that Section. In

relation to the rate of duty, the effect of clause (a) of Section 15(1), is that the rate

which is in force on the date on which a bill of entry is presented under Section

46 (in the case of goods entered for home consumption) is applicable to the

imported goods. When the duties come into force under the enactments imposing

them is dependent on and defined by the terms of the particular enactment.




18      Chapter IX of the Customs Act contains provisions for warehousing.

Section 68 which falls under that Chapter stipulates that goods which have been

warehoused may be cleared for home consumption if:
  a) A bill of entry for home consumption has been presented;
  b) Import duty, interest, fine and penalties, as applicable, have been paid; and



                                           22
                                                                              PART F


   c) An order for clearance for home consumption has been made by the

      proper officer.


Provided that the order referred to in clause (c) may also be made electronically

through the customs automated system on the basis of risk evaluation through

appropriate selection criteria.


For goods which are cleared from a warehouse under Section 68, clause (b) of

Section 15 (1) provides that the rate of duty and valuation are those “in force” “on

the date” on which a bill of entry for home consumption is presented under

Section 68. In the case of other goods, it is the date of the payment of duty which

determines the rate of duty under clause (c) of Section 15(1).


The proviso to Section 15 (1) contemplates a situation where a bill of entry has

been presented before the date of the entry inwards of the vessel or the arrival of

the aircraft or vehicle through which the goods are imported. Under the proviso to

Section 46(3), a bill of entry may be presented at any time not exceeding thirty

days prior to the expected arrival of the aircraft or vehicle by which the goods

have been shipped for importation into India. Dealing with such a situation, the

proviso to Section 15(1) states that if a bill of entry has been presented prior to

the date of the entry inwards of the vessel or the arrival of the aircraft or vehicle

by which the goods are imported, the bill of entry is deemed to have been

presented on the date of the entry inwards or the arrival of the goods. Hence

even where the bill of entry has been presented before the date of the entry

inwards or the arrival of the aircraft or vehicle, the rate of duty is determined with

reference to the date of entry inwards or the arrival of the aircraft or vehicle. This


                                          23
                                                                                  PART F


is a consequence of the deeming fiction under the proviso, as a result of which

the presentation of the bill of entry, when filed prior to the arrival of the goods, is

deemed to be on the date of the entry inwards or the arrival of the aircraft or

vehicle. Hence, implicit in the provisions of Section 15(1) are the dual or (as

counsel before the court described them) the twin requirements of (i) the

presentation of the bill of entry; and (ii) the entry inwards of the vessel or, as the

case may be, the arrival of the aircraft or vehicle.



19    Section 17 provides for the assessment of duty. Section 46 provides for the

entry of goods on importation. Both the provisions of Section 17 and Section 46

have undergone legislative changes by Act 8 of 2011 and by the Finance Act of

2018. By Act 8 of 2011, Section 17 was substituted and Section 46 was amended

to provide for the presentation in the electronic form of a bill of entry for home

consumption or warehousing. Section 46 provides as follows:

             “46. Entry of goods on importation.—(1) The importer of
             any goods, other than goods intended for transit or
             transhipment, shall make entry thereof by presenting
             [electronically] [on the customs automated system] to
             the proper officer a bill of entry for home consumption or
             warehousing in such form and manner as may be
             prescribed: Provided that the [Principal Commissioner of
             Customs or Commissioner of Customs] may, in cases
             where it is not feasible to make entry by presenting
             electronically on the customs automated system, allow
             an entry to be presented in any other manner: Provided
             further that if the importer makes and subscribes to a
             declaration before the proper officer, to the effect that he is
             unable for want of full information to furnish all the particulars
             of the goods required under this sub-section, the proper
             officer may, pending the production of such information,
             permit him, previous to the entry thereof (a) to examine the
             goods in the presence of an officer of customs, or (b) to
             deposit the goods in a public warehouse appointed under
             section 57 without warehousing the same.


                                              24
                                                                                PART F


            (2) Save as otherwise permitted by the proper officer, a bill of
            entry shall include all the goods mentioned in the bill of lading
            or other receipt given by the carrier to the consignor.

            (3) The importer shall present the bill of entry under sub-
            section (1) before the end of the next day following the day
            (excluding holidays) on which the aircraft or vessel or vehicle
            carrying the goods arrives at a customs station at which such
            goods are to be cleared for home consumption or
            warehousing: Provided that a bill of entry may be presented
            at any time not exceeding thirty days prior to the expected
            arrival of the aircraft or vessel or vehicle by which the goods
            have been shipped for importation into India: Provided further
            that where the bill of entry is not presented within the time so
            specified and the proper officer is satisfied that there was no
            sufficient cause for such delay, the importer shall pay such
            charges for late presentation of the bill of entry as may be
            prescribed.

            (4) The importer while presenting a bill of entry shall make
            and subscribe to a declaration as to the truth of the contents
            of such bill of entry and shall, in support of such declaration,
            produce to the proper officer the invoice, if any, [and such
            other documents relating to the imported goods as may be
            prescribed].

            (4A) The importer who presents a bill of entry shall ensure the
            following, namely:—

                 (a) the accuracy and completeness of the information
                 given therein;

                 (b) the authenticity and validity of any document
                 supporting it; and

                 (c) compliance with the restriction or prohibition, if any,
                 relating to the goods under this Act or under any other
                 law for the time being in force…….”

                                                      (emphasis supplied)




Sub-section (1) of Section 46 requires an importer of goods to make an entry by

presenting a bill of entry for home consumption or warehousing “electronically

on the customs automated system” to the proper officer “in such form and

manner as may be prescribed”. The word ‘electronically’ was introduced by Act


                                             25
                                                                                   PART F


8 of 2011 with effect from 8 April 2011. The provision for the presentation of the

bill of entry on the customs automated system and in ‘such form and manner as

prescribed’ was introduced by the Finance Act of 2018. Under sub-section (3) of

Section 46, a bill of entry under sub-section (1) must be presented before the end

of the day following the day on which the aircraft, vessel or vehicle carrying the

goods arrives at a customs station at which the goods are to be cleared for home

consumption or warehousing (holidays being excluded). The first proviso to sub-

section (3) enables the presentation of a bill of entry before arrival, at a time not

exceeding thirty days prior to the expected arrival of the aircraft, vessel or vehicle

by which the goods have been shipped for importation. Under the second proviso

if the bill of entry is not presented within the specified time without sufficient

cause, the importer is required to pay the charges prescribed for late presentation

of the bill of entry.


20     Section 17 makes provisions for the assessment of duty:

               “Assessment of duty.

               17. Assessment of duty --(1) An importer entering any
               imported goods under section 46, or an exporter entering any
               export goods under section 50, shall, save as otherwise
               provided in section 85, self-assess the duty, if any, leviable on
               such goods.

               (2) The proper officer may verify [the entries made under
               section 46 or section 50 and the self-assessment of goods
               referred to in sub-section (1)] and for this purpose, examine or
               test any imported goods or export goods or such part thereof
               as may be necessary.
               Provided that the selection of cases for verification shall
               primarily be on the basis of risk evaluation through appropriate
               selection criteria.
               (3) For the purposes of verification under sub-section (2), the
               proper officer may require the importer, exporter or any other
               person to produce any document or information, whereby the
               duty leviable on the imported goods or export goods, as the

                                               26
                                                                              PART F


             case may be, can be ascertained and thereupon, the importer,
             exporter or such other person shall produce such document or
             furnish such information.
             (4) Where it is found on verification, examination or
             testing of the goods or otherwise that the self-assessment
             is not done correctly, the proper officer may, without
             prejudice to any other action which may be taken under
             this Act, re-assess the duty leviable on such goods…..”
             (5) Where any re-assessment done under sub-section (4) is
             contrary to the self-assessment done by the importer or
             exporter and in cases other than those where the importer or
             exporter, as the case may be, confirms his acceptance of the
             said re-assessment in writing, the proper officer shall pass a
             speaking order on the re-assessment, within fifteen days from
             the date of re-assessment of the bill of entry or the shipping
             bill, as the case may be.
             Explanation.-For the removal of doubts, it is hereby declared
             that in cases where an importer has entered any imported
             goods under section 46 or an exporter has entered any export
             goods under section 50 before the date on which the Finance
             Bill, 2011 receives the assent of the President, such imported
             goods or export goods shall continue to be governed by the
             provisions of section 17 as it stood immediately before the
             date on which such assent is received.”
                                                     (emphasis supplied)




Prior to its substitution by Amending Act 8 of 2011, Section 17 contained

requirements for (i) examination and testing of goods; and (ii) assessment.

Section 17, as it stood prior to substitution, was in the following terms:


             “17. Assessment of Duty. –

             (1) After an importer has entered any imported goods under
             section 46 or an exporter has entered any export goods
             under, section 50 the imported goods or the export goods, as
             the case may be, or such part thereof as may be necessary
             may, without undue delay, be examined and tested by the
             proper officer.

             (2) After such examination and testing, the duty, if any,
             leviable on such goods shall, save as otherwise provided in
             section 85, be assessed.


                                            27
                                                                                 PART F


             (3) For the purpose of assessing duty under sub-section (2),
             the proper officer may require the importer, exporter or any
             other person to produce any contract, broker's note, policy of
             insurance, catalogue or other document whereby the duty
             leviable on the imported goods or export goods, as the case
             may be, can be ascertained, and to furnish any information
             required for such ascertainment which it is in his power to
             produce or furnish, and thereupon the importer, exporter or
             such other person shall produce such document and furnish
             such information.

             (4) Notwithstanding anything contained in this section,
             imported goods or export goods may, prior to the examination
             or testing thereof, be permitted by the proper officer to be
             assessed to duty on the basis of the statements made in the
             enter relating thereto and the documents produced and the
             information furnished under sub-section (3); but if it is found
             subsequently on examination or testing of the goods or
             otherwise that any statement in such entry or document or
             any information so furnished is not true in respect of any
             matter relevant to the assessment, the goods may, without
             prejudice to any other action which may be taken under this
             Act, be re-assessed to duty.

             (5) Where any assessment done under sub-section (2) is
             contrary to the claim of the importer or exporter regarding
             valuation of goods, classification, exemption or concessions
             of duty availed consequent to any notification therefore under
             this Act, and in cases other than those where the importer or
             exporter, as the case may be, confirms his acceptance of the
             said assessment in writing, the proper officer shall pass a
             speaking order within fifteen days from the date of
             assessment of the bill of entry or the shipping bill, as the case
             may be.”



The amendment of 2011 has made significant legislative changes in the

procedure and modalities for assessment of duty under Section 17. Under sub-

section 1 of Section 17, the importer entering imported goods under Section 46,

has to ‘self-assess’ duty (except as otherwise envisaged in the provisions of

Section 85). Under sub-section (2), the proper officer may verify the entries made

under Section 46 and the self-assessment made under sub-section (1) and may

examine or test the goods. The selection of goods for verification has to be

                                              28
                                                                                PART F


primarily on the basis of risk evaluation through appropriate selection criteria.

Under sub-section (4), where it is found on verification, examination or testing of

goods or otherwise that the self-assessment has not been done properly the

proper officer is entrusted with a power of re-assessment. Sub-section (5)

requires the passing of a speaking order upon re-assessment.


21    Section 47 provides for the clearance of goods for home consumption:

             “Clearance of goods for home consumption.

             (1) Where the proper officer is satisfied that any goods
             entered for home consumption are not prohibited goods
             and the importer has paid the import duty, if any,
             assessed thereon and any charges payable under this Act in
             respect of the same, the proper officer may make an order
             permitting clearance of the goods for home
             consumption:

             Provided that such order may also be made electronically
             through the customs automated system on the basis or
             risk evaluation through appropriate selection criteria:
             Provided further that the Central Government may, by
             notification in the Official Gazette, permit certain class of
             importers to make deferred payment of said duty or any
             charges in such manner as may be provided by rules.
             (2) The importer shall pay the import duty--
             (a) on the date of presentation of the bill of entry in the
             case of self assessment; or
             (b) within one day (excluding holidays) from the date on which
             the bill of entry is returned to him by the proper officer for
             payment of duty in the case of assessment, reassessment or
             provisional assessment; or
             (c) in the case of deferred payment under the proviso to sub-
             section (1), from such due date as may be specified by rules
             made in this behalf,
             and if he fails to pay the duty within the time so specified, he
             shall pay interest on the duty not paid or short-paid till the
             date of its payment, at such rate, not less than ten per cent.
             but not exceeding thirty-six per cent. per annum, as may be
             fixed by the Central Government, by notification in the Official
             Gazette……”
                                                      (emphasis supplied)

                                             29
                                                                             PART F


Sub-section (2) of Section 47 requires the importer to pay import duty “on the

date of presentation of the bill of entry in the case of self-assessment”.

Alternatively, where the bill of entry is returned to the importer for the payment of

duty in the case of assessment, re-assessment or provisional assessment, the

import duty has to be paid within a day, after excluding holidays.



The provisions contained in Section 46 for the entry of goods on importation and

those in Section 17 for assessment form part of a composite scheme. Section 46

requires an importer of goods to make an entry in the electronic form of a bill of

entry for home consumption or, as the case may be, for warehousing, on the

customs automated system. An exception is contained in the proviso to Section

46 (1) for cases where it is not feasible to make an entry in the electronic form on

the customs automated system. The bill of entry under sub-section (1) has to be

presented not later than the day following the arrival of the goods though it can

be presented before the arrival of goods, at a time not exceeding thirty days prior

to their expected arrival. In tandem with the provisions of Section 46, Section 17

provides for the self-assessment of duty by the importer.




Section 46(1) stipulates that the bill of entry has to be presented in the form and

in the manner ‘prescribed’. The expression ‘prescribed’ is defined in Section 2(32)

to mean prescribed by regulations made under the Act.             The Bill of Entry

(Electronic Integrated Declaration and Paperless Processing) Regulations 2018

have been made in pursuance of the enabling power conferred by Sections 46

and 47 and Section 157 which contains a general power to make regulations.


                                         30
                                                                                               PART F


Section 157(2)(a) was amended by the Finance Act 2018 (Act 13 of 2018) to

allow for the power to frame regulations on the form and manner of delivering or

presenting inter alia a bill of entry. Regulation 2(c) of the 2018 Regulations

defines the expression bill of entry in the following terms:

                “(c) “bill of entry” means electronic integrated declaration
                accepted and a unique number generated and assigned to
                that particular bill of entry by the Indian Customs Electronic
                Data Interchange System, and includes its electronic records
                or print-outs”


Regulation 2(d) defines the expression electronic integrated declaration:

                “(d) “electronic integrated declaration” means particulars
                relating to the imported goods that are entered in the Indian
                Customs Electronic Data Interchange System”



Under Regulation 2(e), “ICEGATE” is the customs automated system of the

Central Board of Indirect Taxes and Customs. Regulation 3 requires the

authorized person (defined in Regulation 2(b) 7), which includes the importer, to

enter the electronic integrated declaration and supporting documents by affixing a

digital signature. Regulation 3 is as follows:

                “3. The authorised person shall enter the electronic integrated
                declaration and the supporting documents himself by affixing
                his digital signature and enter them on the Customs
                Automated System and he may also get the electronic
                integrated declaration made on the customs automated
                system along with the supporting documents by availing the
                services at the service centre.”




Regulation 4 provides as follows
7 2(b) “authorised person” means an importer or a person authorised by him who has a valid licence under
the Customs Brokers Licensing Regulations, 2013 or any other regulation dealing with the similar matters
and it also includes an employee of the Customs broker who has been issued a photo identity card in Form
G under the Customs Brokers Licensing Regulations, 2013 or any other regulation dealing with the similar
matters;

                                                  31
                                                                                  PART F


             “4. (1) The authorised person shall file the bill of entry before
             the end of the next day following the day (excluding holidays)
             on which the aircraft or vessel or vehicle carrying the goods
             arrives at a customs station at which such goods are to be
             cleared for home consumption or warehousing.
             (2) The bill of entry shall be deemed to have been filed
             and self-assessment completed when after entry of the
             electronic integrated declaration on the customs
             automated system or by way of data entry through the
             service centre, a bill of entry number is generated by the
             Indian Customs Electronic Data Interchange System for
             the said declaration and the self-assessed copy of the
             Bill of Entry may be electronically transmitted to the
             authorised person or printed out at the service centre.
             (3) Where the bill of entry is not filed within the time specified
             in sub-regulation (1) and the proper officer of Customs is
             satisfied that there was no sufficient cause for such delay, the
             importer shall be liable to pay charges for late presentation of
             the bill of entry at the rate of ……”
                                                         (emphasis supplied)




22    The Regulations of 2018 have made provisions for submission of a

declaration and generation of the bill of entry in an electronic form on the

automated platform provided by the Central Board of Indirect Taxes and

Customs. Sub-regulation (2) of Regulation 4 embodies a legal fiction. Regulation

4(2) stipulates that the bill of entry is deemed to have been filed and self-

assessment completed when after the entry of the electronic integrated

declaration on the customs automated system (or by data entry through a service

centre) a bill of entry number is generated by the Indian Customs Electronic Data

Interchange (“EDI”) System. The self-assessed copy of the bill of entry may be

electronically transmitted to the authorized person under the deeming fiction

which is created by Regulation 4(2). Hence, the bill of entry is deemed to be filed

and the self-assessment completed when the requirements of Regulation 4(2)

are fulfilled namely by the (i) entry of the declaration on the customs automated


                                              32
                                                                              PART F


system; and (ii) generation of a bill of entry number by the EDI system. Following

this, the self-assessed copy of the bill of entry is electronically transmitted to the

authorized person.

23    In terms of the provisions of Section 15(1)(a), in the case of goods which

are entered for home consumption under Section 46, the date of presentation of

the bill of entry determines the rate of duty and tariff valuation. Under Section

47(2)(a), the importer is obliged to pay the import duty on the date of the

presentation of the bill of entry in the case of self-assessment. Regulation 4(2) of

the Regulations of 2018 categorically stipulates when the presentation of the bill

of entry is complete. Once the bill of entry is deemed to have been presented in

terms of Regulation 4(2) the rate and valuation in force stand crystalized under

Section 15(1)(a). Section 17(4) confers a power of re-assessment on the proper

officer where it is found on verification, examination or testing of the goods or

otherwise- that the self-assessment has not been done correctly. In the present

case the customs authorities sought to exercise the power of re-assessment on

the ground of the subsequent notification enhancing the rate of duty. The fact of

the matter is that self-assessment was carried out on the basis of the rate of duty

which prevailed at the time of the presentation of the bill of entry. This is not and

cannot be a matter of dispute. Notification 5/2019, which introduced a new tariff

entry – 980 60 000 - in the First schedule to the Customs Tariff Act covering all

goods originating in or exported from the Islamic Republic of Pakistan, was not in

force at the time when the self-assessment was carried out.
24     Under Section 15(1)(a) the rate of duty is the rate in force on the date of

the presentation of a bill of entry where the goods are entered for home

consumption under Section 46. The submission of the learned ASG is that the

                                          33
                                                                              PART F


expression “on the date” is adopted by the legislature in clauses (a) and (b) and

in the proviso to Section 15(1). He urged that Section 15(1) has no reference to

time but only to the date of the presentation of the bill of entry and once a

notification was issued on 16 February 2019 enhancing the rate of duty, that is

the duty ‘in force’ on the date of presentation. Section 15(1)(a) uses two

expressions (i) the rate and valuation “in force”; and (ii) “on the date” of the

presentation of the bill of entry for home consumption under Section 46. The

provisions of Section 15(1)(a) have to be read in conjunction with the provisions

of Section 46 which are referred to in the former provision. Section 46 has

incorporated a regime which encompasses the submission of the bill of entry for

home consumption or warehousing in an electronic format, on the customs

automated system in the manner which is prescribed. The Regulations of 2018

stipulate the manner in which the bill of entry has to be presented. The deeming

fiction in Regulation 4(2) specifies when presentation of the bill of entry and ‘self-

assessment’ are complete. The rate of duty stands crystallized under Section

15(1)(a) once the deeming fiction under Regulation 4(2) comes into existence.

The regulations have to be read together with the statutory provisions contained

in Section 15(1)(a) and Section 46, while determining the rate of duty.




                                          34
                                                                                       PART G




G       Precedent


25      At this stage it is necessary to analyze the precedent on the subject. In

Bharat     Surfactants      (Private)     Limited     vs.    Union     of    India8   (“Bharat

Surfactants”), customs duty was imposed on the import of edible oil by the

petitioners at the rate of 150 per cent on the basis that the import was made on

the date of the inward entry, which was 31 July 1981. The vessel arrived and

registered in the Port of Bombay on 11 July 1981 but since a berth was not

available, the cargo could not be unloaded. The vessel left Bombay and

proceeded to Karachi and returned towards the end of July 1981. The rate of

customs duty prevailing on 11 July 1981 was 12.5 per cent and the contention of

the importer was that but for the fact that the vessel was unable to secure a

berth, it would have delivered the cargo. Speaking for a Constitution Bench, Chief

Justice R S Pathak rejected the contention of the importer that the import of

goods must be deemed to have taken place on 11 July 1981 when the ship

originally arrived in Bombay port and registered itself. The Constitution Bench

held:

               “14…The provisions of Section 15 are clear in themselves.
               The date on which a Bill of Entry is presented under Section
               46 is, in the case of goods entered for home consumption, the
               date relevant for determining the rate of duty and tariff
               valuation. Where the Bill of Entry is presented before the date
               of Entry Inwards of the vessel, the Bill of Entry is deemed to
               have been presented on the date of such Entry Inwards.”


8 (1989) 4 SCC 21

                                               35
                                                                                  PART G




The Constitution Bench held that the date of entry inwards of the vessel in the

Customs’ register was mentioned as 31 July 1981 and the rate of import duty and

tariff valuation would be that which was in force on that day. The decision in

Bharat Surfactants was adverted to in the decision of this court in Priyanka

Overseas Pvt. Ltd. vs. Union of India9. Justice N M Kasliwal, speaking for the

two judge Bench, observed:

              “34…The rate of duty and tariff valuation on the imported
              goods may be changed from time to time and as such the
              legislature has clearly expressed its intention under Section 15
              as to on what date the rate of duty and tariff valuation is to be
              determined…

              Many contingencies may happen in between the filing of bill of
              entry and actual removal of the goods from the warehouse for
              which sometimes the importer of goods may himself be
              responsible, in some cases the responsibility may lie on the
              customs authorities and there may also be contingencies
              beyond the control of both the parties. In any case the
              intention of the legislature being clear, rate of duty is to be
              applied, as may be in force on the date of actual removal of
              goods from the warehouse under Section 15(1)(b) of the
              Customs Act.”




The above observations, referring to the date of the actual removal of goods from

the warehouse, were made in the context of the provisions of Section 15(1)(b). In

a subsequent decision in Dhiraj Lal H Vohra vs. Union of India10, Justice K

Ramaswamy speaking for a three judge Bench observed:

              “3. It is clear from a bare reading of these relevant provisions
              that the due date to calculate the rate of duty applicable to
              any imported goods shall be the rate and valuation in force, in
              the case of the goods entered for home consumption under
              Section 46, is the date on which the bill of entry in respect of

9 1991 Supp (1) SCC 102
10 1993 Supp (3) SCC 453

                                              36
                                                                                  PART G


              such goods is presented under that section and in the case of
              goods cleared from a warehouse under Section 68, the date
              on which the goods are actually removed from the
              warehouse. By operation of the proviso if a bill of entry has
              been presented before the date of entry inwards the bill of
              entry shall be deemed to have been presented “on the date of
              such entry inwards” but would be subject to the operation of
              Sections 46 and 31(1) of the Act.”



In that case the ship had arrived at the Port of Madras on 20 February 1989 and

was ready to discharge her cargo. Though the import manifest was delivered, the

cargo could not be handled as a result of a continuous strike. The bill of entry for

clearance of goods for home consumption was presented on 27 February 1989.

The ship arrived into the port and was berthed on 2 March 1989 on which date

the entry inwards was granted. From 1 March 1989, the rate of duty was

increased. The court rejected the contention that since the vessel had entered

Indian territorial waters on 20 February 1989 when she was ready to discharge

the cargo, the rate of duty must be that which prevailed on that date:

              “3…The contention, therefore that the ship entered Indian
              territorial waters on February 20, 1989 and was ready to
              discharge the cargo is not relevant for the purpose of Section
              15(1) read with Sections 46 and 31 of the Act. The prior
              entries regarding presentation of the bill of entry for clearance
              of the goods on February 27, 1989 and their receipt in the
              appraising section on February 28, 1989 also are irrelevant.
              The relevant date to fix the rate of customs duty, therefore, is
              March 2, 1989. The rate which prevailed as on that date
              would be the duty to which the goods imported are liable to
              the impost and the goods would be cleared on its payment in
              accordance with the rate of levy of customs prevailing as on
              March 2, 1989.”



Another decision of a Bench comprising three learned judges of this Court in

D.C.M. vs. Union of India11 held as follows:

11 1995 Supp (3) SCC 223

                                               37
                                                                  PART G


“7…A reading of Sections 15, 46 and 68 makes it clear that
they provide an option to the importer either to file a bill of
entry for home consumption straight away (in which case he




                                38
                                                                                 PART H


              has to pay the duty determined with reference to that date) or
              to file a bill of entry for warehousing. In the latter case, the
              goods are merely warehoused. The import duty will be levied
              at the rate and on the basis of the valuation determined in
              accordance with the provisions prevailing on the date of
              clearance from the warehouse for which purpose the importer
              has to file a fresh bill of entry for home consumption. In other
              words, it is the date of filing the bill of entry for home
              consumption which determines the rate of duty in clauses (a)
              and (b) of Section 15. Inasmuch as the matter is left to the
              option of the importer and also because a uniform principle is
              adopted by the Act, as explained above, we see no room for
              any legitimate grievance of discrimination. There is also no
              presumption that rate of duty always goes up. It may also go
              down, in which case, the importer stands to gain.”



26     The presentation of a bill of entry for home consumption under Section 46

is hence the definitive event with reference to which the customs’ duty payable

for import is determined. The duty in force on the day when the bill of entry for

home consumption is presented is the duty which is applicable under Section

15(1)(a). It is in view of this principle that the entry of the vessel into territorial

waters, before the presentation of the bill of entry, has been held not to fix the

rate of duty where the rate of duty has undergone a change.




H      Interpreting ‘day’ and ‘date’


27     The expressions “day” and “date” have been construed in varying contexts

in the precedents of this Court. The underlying feature of the decisions is that the

content of those expressions is based on the context. In Raj Kumar Yadav vs.

Samir Kumar Mahaseth12, the limitation provided by Section 81 of the

Representation of the People Act 1951 expired on the 45 th day from the date of



12 (2005) 3 SCC 601

                                              39
                                                                                PART H


the election. Interpreting the provision, Chief Justice R.C. Lahoti while speaking

for a three judge Bench of this Court observed :

              “6…The word “day” is not defined in the Act. It shall have to
              be assigned its ordinary meaning as understood in law. The
              word “day” as per English calendar begins at midnight and
              covers a period of 24 hours thereafter, in the absence of there
              being anything to the contrary in the context.”




Hence, in that case the Election Petition could have been presented up to

midnight falling between 27 and 28 August 2003. The Court observed that the

limitation which was prescribed by the statute could not be curtailed or taken

away by the rules of the High Court, governing its procedure.




28     In New India Assurance Co. Ltd. vs. Ram Dayal13 (“Ram Dayal”), a two

judge Bench of this Court noted that the insurance policy in respect of the vehicle

was up to 31 August 1984 and could be renewed. Instead of renewing the policy,

a fresh insurance policy was taken from 28 September 1984, on which date the

accident occurred. This Court upheld the view of the Punjab and Haryana High

Court, which was supported by earlier decisions of the Madras High Court,

Punjab and Haryana High Court and the Allahabad High Court, that the insurance

cover commenced from the beginning of the day and concluded that:

              “4… when a policy is taken on a particular date, its
              effectiveness is from the commencement of the date and,
              therefore, the High Court, in our opinion, was right in holding
              that the insurer was liable in terms of the Act to meet the
              liability of the owner under the award.”




13 (1990) 2 SCC 680

                                              40
                                                                                   PART H


29     On the other hand, in National Insurance Company Limited vs. Geeta

Devi14, the cover note was issued on 9 June 1989 at 4:40 pm while the accident

took place at 11:30 am on the same day. A two judge Bench of this Court

distinguished the decision in Ram Dayal (supra) and held that when the cover

note mentioned the date of issue of the policy as 9 June 1989 and the time as

4:40 pm “ it necessarily means that the effective date of issue and time of issue is

as mentioned on the cover note.” Since the cover note mentioned both the date

and time, the Court held that the principle that the insurance cover would date

back to midnight of the preceding day would not cover the factual situation.




30     In Ahmadsahab Abdul Mulla (2) Dead by proposed Lrs. vs. Bibijan15,

the issue before this Court was whether the expression “date” in Article 54 of the

Schedule to the Limitation Act (which prescribes the period of limitation for a suit

for specific performance) is suggestive of a specific date in the calendar. The

court observed:

              “11. The inevitable conclusion is that the expression “date
              fixed for the performance” is a crystallised notion. This is clear
              from the fact that the second part “time from which period
              begins to run” refers to a case where no such date is fixed. To
              put it differently, when date is fixed it means that there is a
              definite date fixed for doing a particular act. Even in the
              second part the stress is on “when the plaintiff has notice that
              performance is refused”. Here again, there is a definite point
              of time, when the plaintiff notices the refusal. In that sense
              both the parts refer to definite dates. So, there is no question
              of finding out an intention from other circumstances.”




14 (2010) 15 SCC 670
15 (2009) 5 SCC 462

                                               41
                                                                                PART H


31     The expression ‘date’ in Article 54 was held to be suggestive of a specified

date in the calendar. In Pashupati Nath Singh vs. Harihar Prasad Singh16, a

three judge Bench construed the words “on the date fixed for scrutiny” in Section

36(2)(a) of the Representation of the People Act 1951. Interpreting those words,

the Court held that the qualification of a candidate must exist from the earliest

moment of the day of scrutiny:

               “13. It seems to us that the expression “on the date fixed for
               scrutiny” in Section 36(2)(a) means “on the whole of the day
               on which the scrutiny of nomination has to take place”. In
               other words, the qualification must exist from the earliest
               moment of the day of scrutiny. It will be noticed that on this
               date the Returning Officer has to decide the objections and
               the objections have to be made by the other candidates after
               examining the nomination papers and in the light of Section
               36(2) of the Act and other provisions. On the date of the
               scrutiny the other candidates should be in a position to raise
               all possible objections before the scrutiny of a particular
               nomination paper starts.”



32     A Special Bench of the Madras High Court in Re Court Fees17 dealt with

the interesting issue of whether the law disregards fractions of the day. A

notification was published in the Fort St. George Gazette on 5 May 1922 by

which the table of fees leviable in respect of the institution of suits under

Appendix – II of the old rules on the Original side was amended. Instead of a

fixed fee of Rs 30, it was provided that Rs 150 was to be levied in all suits where

the value of the subject matter did not exceed Rs 10,000/- and in respect of suits

of a higher value, Rs 20/- was to be levied for every Rs 5,000/- or part thereof in

excess of Rs 10,000/-. The notification stated that “the amendments do come

into force from the date of publication in the Fort St. George Gazette”. The

16 (1968) 2 SCR 812
17 ILR (1923) 46 Mad 685

                                              42
                                                                               PART H


office hours of the High Court were from 11am to 5pm. The notification reached

the High Court at about 5pm, at the close of the office hours. The issue before the

Special Bench was whether the rules imposing increased institution fees on suits

on the Original side of the High Court would apply the new scale to suits which

had already been instituted on that day. Chief Justice Schwabe, on behalf of the

majority, held “that the hour of the day at which the Gazette was actually

published is a wholly irrelevant consideration”. The Chief Justice noted that the

use of the expression ‘from’ may have one of two meanings namely on and after,

that is including the named date, or merely after, that is excluding the named

date. The Chief Justice took the view that it is necessary to look at the context

and the circumstances of each case to arrive at the true construction. Having said

this, the Chief Justice outlined the principles in the following extract on page 688:

             “(1) that, if the named date is the beginning of a defined
             limited period, that, where there is a terminus ad quem as
             well as a terminus a quo, then prima facie the first day is
             excluded; (2) that, if the named date is the beginning of an
             indefinite period then prima facie the first day is included. I
             say prima facie because in my view there must be
             exceptions”.




In his view, the expression “from a named date” meant “on and after that day”.

Hence the date on which the notification was published in the official Gazette was

held to apply to all plaints which were filed on 5 May 1922.


Justice Coutts Trotter, arrived at the same conclusion as the Chief Justice,

following a different path, which he set out in the following observations, on page

691 :



                                             43
                                                                                  PART H


             “What I conceive to emerge from the decided cases is this:
             that as the law in general neglects fractions of a day you must
             either exclude or include the whole of the day with which a
             given statute or rule or regulation deals. And the exclusion or
             inclusion, I think, is clearly provided in two other rules. If you
             are fixing the point of time at which a certain state of things is
             to be called into existence, that state of things comes into
             existence at midnight of the day preceding the day at which or
             on which or from which or from and after which the new state
             of things begins. In such cases the statue or rule is only
             concerned in fixing the terminus a quo of a new state of law
             which is enacted to continue indefinitely, in other words, until
             repealed by a new enactment of the legislature where, in
             short, you have a terminus a quo but no terminus ad quem.”



In his view, on page 693:


             “Where a statute fixes only the terminus a quo of a state of
             things, which is envisaged as to last indefinitely, the common
             law rule obtains that you ought to neglect fractions of a day
             and the statute or regulation or order takes effect from the
             first moment of the day on which it is enacted or passed, that
             is to say, from midnight of the day preceding the day on which
             it is promulgated: where on the other hand, a statute delimits
             a period marked both by a terminus a quo and a terminus ad
             quem, the former is to be excluded and the latter to be
             included in the reckoning.”



The notification, in this view, fell in the former class and was held to have come

into force on the first second of the 5 May, that is to say from midnight of 4 May.

Hence all plaints which were filed on 5 May were liable to the enhanced fee.


The tightly reasoned and eloquent dissenting opinion delivered by Justice

Kumaraswami Sastri, on the other hand, deserves close attention. The learned

Judge noted that if the case were to be decided on the principle that the law

disregards fractions of a day, it could mean any one of two things: either that a

fraction of a day is to be taken as a whole day or that it is to be excluded



                                              44
                                                                                PART H


altogether from the calculation. Consequently, “it does not help us to determine in

any particular case whether the part is to be left out or kept in”. Justice

Kumaraswami Sastri observed that there is no invariable rule that the use of the

expression ‘from’ includes the first day. Nor was there any basis in principle in the

submission of the Crown that the exclusion of the first day where the word “from”

is used is only to be in case where there are two termini. The learned Judge held

that rules of equity and good conscience are by the Civil Courts Act to govern

cases not governed by the Hindu and Mohammedan Laws. Voicing a powerful

dissent, Justice Kumaraswami Sastri observed, on page 704:

             “I do not think that the principles which govern, or the devices
             which are resorted to, by the Executive for the purpose of
             raising money by taxation ought to have any weight with us in
             determining whether the date of publication is to be included
             or excluded. I do not think the High Court is part of the tax
             gathering machinery of the Government or has any concern
             with the consequences to the Government of their decision on
             the construction of the rule. The rule, I take it, was passed by
             the Judges of the High Court in the exercise of the powers
             entrusted to them to control the administration of justice and
             the fees were raised because in the opinion of the Judges it
             was just and proper that litigants ought to pay more for the
             benefits which they derive by resorting to the jurisdiction of
             the High Court”.



In the view of the learned Judge, the notification having been received in the

Registry of the High Court at 5pm at the office closing hour, litigants who had

filed plaints before either or they or the office had knowledge of the publication

“did what was perfectly valid under the old rules and they presented the plaints

with Rs 30 stamp irrespective of the value of their claim”. Looking at it from the

citizens’ perspective, the learned Judge observed, on page 704:




                                             45
                                                                                 PART H


             “A person who files a plaint which is properly stamped and
             which is in order at the time of presentation is entitled to have
             his plaint admitted on presentation though as a matter of
             convenience the office receives the plaints and admits them
             at the end of the day or later on. There seems to me to be
             very little justice or equity in directing that persons who have
             done what was perfectly a legal and valid act at the time
             should pay a Court-fee which is much higher simply because
             a notification was received at the close of the day making the
             higher fees chargeable from the date of the notification. It
             may well be that if those persons had notice that instead of
             Rs. 30 they had to pay at least Rs 150 and a maximum that
             would range according to the value of their claim, they might
             rather have compromised with the other side or might have
             had resort to other proceedings like arbitration for settling
             their claims. I can find nothing to justify charging people, who
             filed their plaints on that day without knowledge of the
             notification which only reached the High Court at 5 p.m., with
             the higher fees in respect of plaints filed during the course of
             the day”.




33    Mr Natraj, on behalf of the Union, submitted that Parliament has employed

the phrase “on the date” without making a reference to time. Hence, he submitted

that irrespective of the time of the publication or uploading of the notification

under the Customs Tariff Act in the e-Gazette, the legislature has by a legal

fiction, enacted that the rate of duty on imported goods will be the rate that is

prevalent on the date of the presentation of the bill of entry for home

consumption. He submitted that two different rates of duty cannot be applicable

on the same day. Hence, according to the submission, once a notification is

issued under the Customs Tariff Act, it will be a notification in force on that date

and apply with effect from the commencement of that date.




34    The decisions to which a reference has been made earlier, have construed

the expression “day” or, as the case may be, “date” in varying contexts ranging

                                              46
                                                                           PART H


from the law governing elections, insurance and limitation. A general position in

law has not been laid down that is divorced from subject, context and statute. 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. The provision which falls for construction is

Section 15(1) of which both clauses (a) and (b) use the expression “on the date”.

In clause (a), the rate of duty and valuation is the rate and valuation in force on

the date on which a bill of entry is presented under Section 46 where goods are

entered for home consumption. Under Clause (b), where goods are cleared from

a warehouse under Section 68 it is the date on which a bill of entry for home

consumption is presented under that Section which is determinative of the rate

and valuation.




35    Mr Natraj is textually right when he emphasizes that Section 15 (1)

contains a reference to date and not time. But there are two responses to his 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


                                        47
                                                                              PART H


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, 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. Precision, transparency and seamless

administration are key features of a system which adopts technology in pursuit of

efficiency. As we will explore in greater detail later in this judgment, technology

has enabled both administrators and citizens to know precisely when an

electronic record is uploaded. 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 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.




36    It is with these principles of interpretation in mind that we must evaluate

the submission which was urged by Mr Nataraj, on behalf of the Union, that upon

the issuance of a notification enhancing the rate of duty under Section 8A of the

Customs Tariff Act, the date on which the notification was issued will govern the

rate applicable to all bills of entry, including those which were presented before


                                          48
                                                                            PART H


the enhanced rate was notified. The submission cannot be accepted for several

reasons. For one thing, it misses the significance of the expression “in force’

which has been employed in the prefatory part of Section 15(1). A notification

under Section 8A(1) of the Customs Tariff Act, even though it has the effect of

amending the First Schedule, 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. To accept the submission of the ASG would

mean that the notification under Section 8A would have effect prior to its making,

something which Parliament has not incorporated by language or intent. If, as we

hold, the notification operates for the future beginning with the point of its

adoption, it cannot operate to displace the rate of duty which is applicable when a

bill of entry is presented for home consumption under Section 46.

The submission of the Union cannot be accepted in view of the provisions

contained in Section 46 for the presentation of a bill of entry for home

consumption in an electronic form on the customs automated system. While

making that provision, specifically by means of an amendment by Act 8 of 2011

and later by the Finance Act of 2018, Parliament used the expression “in such

form and manner as may be prescribed.” Regulation 4(2) of the Regulations of

2018 provides when the bill of entry shall be deemed to have been filed and self-

assessment completed. The legal fiction which has been embodied in Regulation

4(2) emanates from the enabling provisions of Section 46. The provisions of

Sections 15(1)(a), 17, 46(1) and 47(2)(a) 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


                                         49
                                                                            PART I


customs automated system, a bill of entry number is generated by the EDI

system for the declaration. Regulation 4(2) provides for a deeming fiction in

regard to the filing of the bill of entry and the completion of self-assessment. In

the context of these specific provisions, it would do violence to the overall

scheme of the statute to interpret the language of Section 15(1)(a) in the manner

in which it is sought to be interpreted by the ASG. The submission of the ASG,

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.




I     Notification under Section 8A of the Customs Tariff Act


37    The second and alternative limb of the submissions of the ASG postulates

that a notification under Section 8A(1) of the Customs Tariff Act is a legislative

act. The rates of duty applicable to different categories of goods imported into

India are set out in the First schedule to the Customs Tariff Act. A notification

under Section 8A(1) amends the First schedule. Hence, the submission is that

the schedule being a part of the Act, any amendment made to it by a notification

is an amendment to the Act. The ASG relies upon the decisions of this Court in



                                        50
                                                                                 PART I


Video Electronics (P) Ltd vs. State of Punjab18 and TN Electricity Board vs.

Status Spinning Mills Limited19 in support of the principle that subordinate

legislation validly made in pursuance of a legislative provision is to be read as if it

is a part of the enactment. Hence, for instance, an exemption granted under a

notification made in pursuance of a statutory provision must be construed as if it

is contained in the legislation.




38     In order to consider the submission, it is necessary at the outset to advert

to the provisions of the Customs Tariff Act. Under Section 8A, an emergency

power is vested in the Central Government to increase the import duties leviable

on an article included in the First schedule where it is satisfied that circumstances

rendering it necessary to take immediate action exist. Section 8A is in the

following terms:

              “8A- Emergency Power of Central Government to increase
              import duties-

              Where in respect of any article included in the First
              Schedule, the Central Government is satisfied that the
              import duty leviable thereon under section 12 of the
              Customs Act, 1962 (52 of 1962) should be increased and
              that circumstances exist which render it necessary to
              take immediate action, it may, by notification in the
              Official Gazette, direct an amendment of that 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:

              Provided that the Central Government shall not issue any
              notification under this subsection for substituting the rate of
              import duty in respect of any article as specified by an earlier
              notification issued under this sub-section by that Government
              before such earlier notification has been approved with or
              without modifications under sub-section (2).

18 (1990) 3 SCC 87
19 (2008) 7 SCC 353

                                              51
                                                                                  PART I


             (2) The provisions of sub-sections (3) and (4) of section 7
             shall apply to any notification issued under sub-section
             (1) as they apply in relation to any notification increasing
             duty issued under sub-section (2) of section 7.”

                                                       (emphasis supplied)




While Section 8A is an emergency power, Section 11A empowers the Central

government in public interest to amend the First schedule:

             “(1) Where the Central Government is satisfied that it is
             necessary so to do in the public interest, it may, by notification
             in the Official Gazette, amend the First Schedule:

             Provided that such amendment shall not alter or affect in any
             manner the rates specified in that Schedule in respect of
             goods at which duties of customs shall be leviable on the
             goods under the Customs Act, 1962 (52 of 1962).”




Sub-section (2) of Section 8A specifies that the provisions of sub-sections (3) and

(4) of Section 7 shall apply to a notification which has been issued under sub-

section (1) of Section 8A. Sub-sections (3) and (4) of Section 7 are in the

following terms:

             “(3) Every notification under sub-section (2), insofar as it
             relates to increase of such duty, shall be laid before each
             House of Parliament if it is sitting as soon as may be
             after the issue of the notification, and if it is not sitting
             within seven days of its re-assembly, and the Central
             Government shall seek the approval of Parliament to the
             notification by a resolution moved within a period of
             fifteen days beginning with the day on which the
             notification is so laid before the House of the People and
             if Parliament makes any modification in the notification
             or directs that the notification should cease to have
             effect, the notification shall thereafter have effect only in
             such modified form or be of no effect, as the case may
             be, but without prejudice to the validity of anything
             previously done thereunder.


                                               52
                                                                                PART I


             (4) For the removal of doubts, it is hereby declared that any
             notification issued under sub-section (2), including any such
             notification approved or modified under sub-section (3), may
             be rescinded by the Central Government at any time by
             notification in the Official Gazette.”

                                                    (emphasis supplied)



Under sub-section (3) of Section 7, the Central government is required to seek

the approval of Parliament to a notification within a period of fifteen days of its

being laid before the House of the People. Where Parliament is in session, the

notification has to be laid before the House as soon as may be after it is issued

and, if it is not, then within seven days of the legislature re-assembling. The

approval of parliament has to be sought within the specified period. The

notification would cease to have effect or take effect with modifications, if

Parliament so directs. In the case of a notification which has been issued under

Section 11A, sub-section (2) does not require the Central government to seek the

approval of Parliament to the notification by a resolution moved within a period of

fifteen days from the date on which the notification has been laid before the

House of the People. Sub-section (2) of Section 11A merely states that the

notification shall either cease to have effect or have effect in a modified form if it

is so directed by both the Houses of Parliament.




39    A notification which is issued in terms of the provisions of Sub-section (1)

of Section 8A is akin to the exercise of a delegated legislative power. The Central

government is empowered to issue a notification enhancing the rate of duty

where it is satisfied that immediate action is necessary to increase the rate of

customs duty on an article specified in the First schedule. The effect of the

                                            53
                                                                                PART J


notification is to amend the First schedule to the Customs Tariff Act in respect of

the import duty leviable on an article under Section 12 of the Customs Act. In

issuing a notification under Sub-section (1) of Section 8A, the Central

government exercises power as a delegate of the legislature. The issue now to

be considered is whether the notification that was issued by the Central

government under Section 8A(1) at 20:46:58 hours on 16 February 2019 took

effect commencing from 0000 hours on that day. The ASG relied on the

provisions of the General Clauses Act in support of his submission that it did.


J        General Clauses Act


40       Section 5(3) of the General Clauses Act 1897 provides thus:

               “(3) Unless the contrary is expressed, a Central Act or
               Regulation shall be construed as coming into operation
               immediately on the expiration of the day preceding its
               commencement.”



The above provision applies to a “Central Act” or “Regulation”. Hence, the above

provision 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. The expressions “Central Act” and “Regulation” are defined by

the statute. The expression “Central Act” is defined in Section 3(7) in the following

terms:

               “(7) “Central Act” shall means an Act of Parliament, and shall
               include—

               (a) an Act of the Dominion Legislature or of the Indian
               Legislature passed before the commencement of the
               Constitution, and




                                              54
                                                                             PART J


              (b) an Act made before such commencement by the Governor
              General in Council or the Governor General, acting in a
              legislative capacity;”



The expression “Regulation” is defined in Section 3(50) as follows:

              “(50) “Regulation” shall mean a Regulation made by the
              President under article 240 of the Constitution and shall
              include a Regulation made by the President under article 243
              thereof and a Regulation made by the Central Government
              under the Government of India Act, 1870, or the Government
              of India Act, 1915, or the Government of India Act, 1935;”



The expression “commencement” is defined in Section 3(13) as follows:

              “(13) “Commencement” used with reference to an Act or
              Regulation, shall mean the day on which the Act or
              Regulation comes into force.”



       The definition of the expression “commencement’ is also relatable to a

       “Central Act” or “Regulation”.



41     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.

42     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


                                            55
                                                                               PART J


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. 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.

43     The above analysis is based on a textual reading of the two definitions –

those of a “Central Act” and “Regulation”. The precedent on the subject confirms

the analysis. This Court has held that 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.



44     In Kolhapur Canesugar Works Ltd. vs. Union of India (UOI)20,

Constitution Bench of this Court had to decide, inter alia, if Rules 10 and 10-a of

the Central Excise Rules could be considered a ‘Central Act’ as defined in

Section 3(7) of the General Clauses Act. This decision of the Court, albeit

subsequently questioned for its interpretation of ‘repeal’ through omission [which

does not have a bearing on the issue at hand], was not assailed for its

interpretation of “Central Act” within the General Clauses Act. Speaking through

Justice D.P. Mohapatra, this Court answered the question of whether the

aforesaid Rules constituted a 'Central Act' in the negative, in the following terms:

              “32. When the term Central Act or Regulation or Rule is used
              in that Act reference has to be made to the definition of that

20 AIR 2000 SC 811.

                                             56
                                                                                   PART J


              term in the statute. It is not possible nor permissible to give a
              meaning to any of the terms different from the definition. It is
              manifest that each term has a distinct and separate meaning
              attributed to it for the purpose of the Act. Therefore, when the
              question to be considered is whether a particular provision of
              the Act applies in a case then the clear and unambiguous
              language of that provision has to be given its true meaning
              and import. The Full Bench has equated a 'rule' with 'statute'.
              In our considered view this is impermissible in view of the
              specific provisions in the Act. When the Legislature by clear
              and unambiguous language has extended the provision of
              Section 6 to cases of repeal of a 'Central Act' or 'Regulation',
              it is not possible to apply the provision to a case of repeal of a
              'Rule'. The position will not be different even if the rule has
              been framed by virtue of the power vested under an
              enactment; it remains a 'rule' and takes its colour from the
              definition of the term in the Act (General Clauses Act).”



45     In Securities and Exchange Board of India vs. Magnum Equity

Services Ltd21, a two judge Bench of this Court considered whether the General

Clauses Act is applicable to the interpretation of the SEBI (Stock Brokers and

Sub-Brokers) Regulations, 1992. The Court observed that the Regulations were

framed by SEBI in exercise of the powers conferred on it by Section 30 of the

SEBI Act, 1992. Section 31 requires the rules and regulations to be laid before

Parliament. Justice Vikramajit Sen concluded as follows:

              “12. The main contention raised by the learned Senior
              Counsel for the appellant is based on the application of the
              General Clauses Act, 1897 which under Section 13(2) states
              that plural includes singular. However, before we consider
              Section 13, we shall have to determine whether the General
              Clauses Act itself is applicable to the SEBI (Stockbrokers and
              Sub-Brokers) Regulations, 1992. Section 3 of the General
              Clauses Act, 1897 states that the said Act is applicable to all
              Central Acts and Regulations made after the commencement
              of this Act. Further, the term “Central Act” has been defined
              under sub-section (7) as an Act of Parliament, which includes
              (a) an Act of the Dominion Legislature or of the Indian

21 (2015) 16 SCC 721



                                               57
                                                                               PART J


             Legislature passed before the commencement of the
             Constitution, and (b) an Act made before such
             commencement by the Governor General in Council or the
             Governor General, acting in a legislative capacity. The SEBI
             (Stockbrokers and Sub-Brokers) Regulations, 1992 are
             issued by SEBI in exercise of the powers conferred on it
             under Section 30 of the SEBI Act, 1992. Section 31 of the
             SEBI Act, reproduced below for the facility of reference,
             provides that the Rules and Regulations are to be laid before
             Parliament:

                    “31. Rules and regulations to be laid before
                    Parliament.— Every rule and every regulation made
                    under this Act shall be laid, as soon as may be after it
                    is made, before each House of Parliament, while it is
                    in session, for a total period of thirty days which may
                    be comprised in one session or in two or more
                    successive sessions, and if, before the expiry of the
                    session immediately following the session or the
                    successive sessions aforesaid, both Houses agree in
                    making any modification in the rule or regulation or
                    both Houses agree that the rule or regulation should
                    not be made, the rule or regulation shall thereafter
                    have effect only in such modified form or be of no
                    effect, as the case may be; so, however, that any
                    such modification or annulment shall be without
                    prejudice to the validity of anything previously done
                    under that rule or regulation.”

             13. Thus in light of the provisions of the SEBI Act, 1992 under
             which the said Regulations have been issued, the latter do
             not tantamount to a Central Act as defined Under Sub-section
             (7) of the definition clause of The General Clauses Act, 1897.”



The Regulations framed under the SEBI Act were held not to fall within the

definition of a ‘Central Act’ contained in Section 3(7) of the General Clauses Act.




46    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




                                             58
                                                                                       PART K


statutory power. The notification has the effect of enhancing the rate of duty

prescribed in the First Schedule to the Customs Tariff Act. That does not,

transform the notification which has been issued in pursuance of a statutory

authority into a ‘Central Act’.




K      Information Technology Act, 2000


47     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.        Providing     the    backdrop      for    Parliamentary

intervention, the Statement of Objects and Reasons underlying the enactment of

the legislation provides the rationale for the law:
              “New communication systems and digital technology have
              made dramatic changes in the way we live. A revolution is
              occurring in the way people transact business. Businesses
              and consumers are increasingly using computers to create,
              transmit and store information in the electronic form instead of
              traditional paper documents. Information stored in electronic
              form has many advantages. It is cheaper, easier to store,
              retrieve and speedier to communicate. Although people are
              aware of these advantages, they are reluctant to conduct
              business or conclude any transaction in the electronic form
              due to lack of appropriate legal framework. The two principal
              hurdles which stand in the way of facilitating electronic
              commerce and electronic government are the requirements
              as to writing and signature for legal recognition. At present
              many legal provisions assume the existence of paper based
              records and documents and records which should bear
              signatures. The law of evidence is traditionally based upon
              paper based records and oral testimony. Since electronic
              commerce eliminates the need for paper-based transactions,
              hence to facilitate e-commerce, the need for legal changes
              have become an urgent necessity. International trade through
              the medium of e-commerce is growing rapidly in the past few
              years and many countries have switched over from traditional
              paper based commerce to e-commerce.”



                                              59
                                                                                     PART K


48     Parliament recognized the need to bring about suitable amendments to

existing legislation to facilitate e-commerce, more so in light of India being a

signatory to the United Nations Commission on International Trade Law’s Model

Law on Electronic Commerce in 1996. It therefore proposed to provide legal

recognition of electronic records and digital signatures. This would, as the

Statement of Objects and Reasons indicate, “enable the conclusion of contracts

and the creation of rights and obligations through the electronic medium”.

Parliament envisaged the use and acceptance of electronic records and digital

signatures in governmental offices and agencies, to facilitate electronic

governance and to “make the citizens’ interaction with the governmental offices

hassle free”.


Bearing the legislative number of Act 21 of 2000, the law came into force on 17

October 2000. The long title to the legislation provides that it is:

                “An Act to provide legal recognition for transactions carried
                out by means of electronic data interchange and other means
                of electronic communication, commonly referred to as
                “electronic commerce”, which involve the use of alternatives
                to paper-based methods of communication and storage of
                information, to facilitate electronic filing of documents with the
                Government agencies and further to amend the Indian Penal
                Code, the Indian Evidence Act, 1872 , the Banker’s Book
                Evidence Act, 1891 and the Reserve Bank of India Act, 1934
                and for matters connected therewith or incidental thereto.”



Section 2(t) defines the expression ‘electronic record’:

                “(t) ―electronic record means data, record or data generated,
                image or sound stored, received or sent in an electronic form
                or micro film or computer generated micro fiche”




                                                 60
                                                                                PART K


Chapter III is devoted specifically to electronic governance. Among its salient

provisions are those providing for:


   (i)     Legal recognition of electronic records (Section 4);
   (ii)    Legal recognition of electronic signatures (Section 5);
   (iii)   Use of electronic records and electronic signatures in government and

           its agencies (Section 6);
   (iv)    Authorization by government to service providers to set-up, maintain

           and upgrade computerized facilities (Section 6A); and
   (v)     Retention of electronic records (Section 7).


Sub-section 1 of Section 6 has a bearing on the issues raised in this case:

              “6. Use of electronic records and electronic signatures in
              Government and its agencies- (1) Where any law provides for
              — (a) the filing of any form, application or any other document
              with any office, authority, body or agency owned or controlled
              by the appropriate Government in a particular manner;

              (b) the issue or grant of any licence, permit, sanction or
              approval by whatever name called in a particular manner;

              (c) the receipt or payment of money in a particular manner,
              then, notwithstanding anything contained in any other law for
              the time being in force, such requirement shall be deemed to
              have been satisfied if such filing, issue, grant, receipt or
              payment, as the case may be, is effected by means of such
              electronic form as may be prescribed by the appropriate
              Government.”



Section 6A contemplates that for the “efficient delivery of services to the public

through electronic means”, government may authorize a service provider to set

up, maintain and upgrade computerized facilities and perform other services.

Section 7 provides legal support to the retention of records in the electronic form.

Where a law requires documents, information or records to be preserved, the

requirement is satisfied by preserving them in an electronic form, subject to the

fulfillment of conditions. One of the conditions stipulated by Section 7(1)(c) is that

                                              61
                                                                                PART K


the details which facilitate the identification of the origin, destination, date and

time of dispatch or the receipt of the electronic record are available in the

electronic record. The date and time of receipt or of the dispatch of an electronic

record are crucial from this perspective to the maintenance of an electronic

record.




49    In exercise of its rule making power, the Central Government formulated

rules for electronic service delivery. Under these rules, called the Information

Technology (Electronic Service Delivery) Rules 2011, governmental authorities

must maintain time stamps of the creation of electronic records. Rule 5(1)

incorporates such a requirement in the following terms:

             “5. Creation of repository of electronically signed electronic
             records by Government Authorities.-

             (1) All authorities that issue any license, permit, certificate,
                 sanction or approval electronically, shall create, archive
                 and maintain a repository of electronically signed
                 electronic records of such licenses, permits, certificates,
                 sanctions or approvals, as the case may be, online with
                 due timestamps of creation of these individual electronic
                 records.”


The Rules provide a procedure for making changes in the repository of

electronically signed electronic records, in Rule 6. Rule 6(2) indicates that the

person authorized to make a change must also electronically sign the change

and the time stamps of the original creation and modification of the electronic

record. Rule 6(2) reads thus:

             “6. Procedure for making changes in a repository of
             electronically signed electronic records.-




                                             62
                                                                                PART K


             (2) Any change effected to any record in a repository of
             electronically signed electronic records and any addition or
             deletion of a record from such repository shall be
             electronically signed by the person who is authorized to make
             such changes along with the time stamps of original creation
             and modification times”



Digital signatures have contextual information including the date and time built

into them. Under the Digital Signature (End entity) Rules 2015, provisions for time

stamps for digital signatures are built into the legal regime under Rule 4(4) and, in

the context of a long term valid digital signature, in Rule 4(7).


Section 13 of the Information Technology Act 2000 contains provisions for the

time and place of the dispatch and receipt of electronic records. It reads as

follows:

             “13. Time and place of dispatch and receipt of electronic
             record.—

             (1) Save as otherwise agreed to between the originator
             and the addressee, the dispatch of an electronic record
             occurs when it enters a computer resource outside the
             control of the originator.

             (2) Save as otherwise agreed between the originator and the
             addressee, the time of receipt of an electronic record shall be
             determined as follows, namely:—

             (a) if the addressee has designated a computer resource for
             the purpose of receiving electronic records,—

             (i) receipt occurs at the time when the electronic record enters
             the designated computer resource; or

             (ii) if the electronic record is sent to a computer resource of
             the addressee that is not the designated computer resource,
             receipt occurs at the time when the electronic record is
             retrieved by the addressee;

             (b) if the addressee has not designated a computer resource
             along with specified timings, if any, receipt occurs when the
             electronic record enters the computer resource of the
             addressee…..”


                                             63
                                                                               PART K


                                                 (emphasis supplied)




The dispatch of a record occurs when it enters a computer resource outside the

control of the originator. The time of receipt of the electronic record is fixed by the

provisions of sub-section 2 of Section 13. When the addressee has designated a

computer resource, receipt occurs when the record enters the computer resource

so designated. Otherwise, where no computer resource is designated, the receipt

of the record is when it is retrieved by the addressee. These provisions have

been incorporated in the law to enable the dispatch and receipt of a record in the

electronic form to be defined with precision with reference to both- time and

place.




50       In the above context, it is to be noted that the rate of customs duty is

determined on the date on which the bill of entry for home consumption is

presented (Section 15). The presentation of the bill of entry has to be made

electronically (Section 46 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




                                          64
                                                                                 PART L


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.




L     Effect of notifications issued in e-gazettes



51    Section 8 of the Information Technology Act, 2000 creates a legal basis for

the publication of laws through e-gazettes. It reads as follows:

             “Section 8 - Publication of rule, regulation, etc., in Electronic
             Gazette-

             Where any law provides that any rule, regulation, order, bye-
             law, notification or any other matter shall be published in the
             Official Gazette, then, such requirement shall be deemed to
             have been satisfied if such rule, regulation, order, bye-law,
             notification or any other matter is published in the Official
             Gazette or Electronic Gazette:

             Provided that where any rule, regulation, order, by-law,
             notification or any other matter is published in the Official
             Gazette or Electronic Gazette, the date of publication shall be
             deemed to be the date of the Gazette which was first
             published in any form.”



52    On 30 September 2015, the Ministry of Urban Development issued an

Office Memorandum numbered No. O-17022/1/2015-PSP-l which discontinued

                                              65
                                                                                   PART L


the practice of physical printing and replaced it with the electronic gazette. The

notification, in relevant part, reads as follows:

                “In compliance with the provisions of Section 8 of the
                Information Technology Act, 2000, it has been decided in
                consultation with Department of Legal Affairs to switch over to
                exclusive e-publishing of the Government of India Gazette
                Notification on its official website with effect from 01.10.2015
                and to do away with the physical printing of Gazette
                Notification. The date of publishing shall be the date of e-
                publication on official website by way of electronic
                gazette in respect of Gazette notification.”

                                                           (emphasis supplied)



53      Thus far, this Court has not had to confront the question as to whether the

shift from the analog to the digital for Gazette notifications has any bearing for

ascertaining when they come into force. The judgments which dealt with the

starting point for the enforceability of notifications were all concerned with

circumstances in which such publication took place in the physical gazette. We

are now required to determine if the shift to electronic gazettes has brought about

a change in this position.


54      The High Courts have begun offering guidance on this score. The Delhi

High Court in M.D. Overseas Industries vs. Union of India22, dealt with a

situation where the Director General of Foreign Trade issued two notifications

dated 25 August 2017 restricting the importation of gold, including gold coins.

Gold coins could no longer be imported freely and had to be imported in

accordance with a public notice issued in that behalf. The petitioners urged that

the restrictive regime created by these notifications was inapplicable to them


22 W.P. (C) 7838/2017 decided on 15 October 2019 (Delhi High Court)

                                                 66
                                                                                 PART L


because the notifications, they contended, came into force only on 28 August,

2017, when they were published in the official gazette. The gold coins imported

by the petitioners, however, were dispatched on 25 August, 2017. Since the

notifications came into force three days later, they contended that these were

inapplicable to them. The notifications were electronically notified in the gazette.


55      The High Court upheld the Petitioner’s view that the notifications were

inapplicable to the petitioners after considering Section 8 of the Information

Technology Act, 2000 along with the Office Memorandum dated 30.9.2015. It

held:


              “32. The endorsement on the electronic copy of the Gazette,
              whereby the impugned Notification Nos. 24 and 25, dated
              25th August, 2017, were notified, seen in juxtaposition with
              Section 8 of the IT Act, and of the OM dated 30th September,
              2015 supra, of the Ministry of Urban Development, makes it
              clear that the impugned Notification Nos. 24 and 25, dated
              25th August, 2017 were, in fact, electronically published in the
              Official Gazette only at or after 10:47 p.m. on 28th August,
              2017.

              33. It has been conclusively held, by the Supreme Court, in a
              catena of decisions - including Harla v. State of Rajasthan
              [1952 (1) SCR 110], B.K. Srinivasan v. State of Karnataka
              [AIR 1987 SC 1059] and U.O.I, v. Param Industries [(2016) 16
              SCC 692] that, notifications would come into force on
              their publication in the Official Gazette, i.e. in the present
              case, with effect from the date and time when they were
              electronically printed in the Gazette, which was at or after
              10:47 p.m. on 28th August, 2017.”

                                                       (emphasis supplied)

56      Thus, the High Court regarded the time of publication as the relevant

marker for determining the enforceability of the notifications. The issue of

determining the starting point for the enforceability of a notification in the

electronic gazette was considered by the Andhra Pradesh High Court in Ruchi

                                              67
                                                                                             PART L


Soya Industries vs. Union of India.23 The petitioner entered into a contract with

its foreign supplier on 18 January 2008 for the import of 9,500 Metric Tons of

crude oil. The first consignment of 4000 metric tons was shipped by the supplier

on 6 February 2018 from Dubai. The petitioner filed two bills of entry for 2000

metric tons of crude oil on 1 March 2018. They were assessed that day and

levied with 30% customs duty and 10% social welfare surcharge. On the same

date, a notification raised the basic customs duty from 30 to 44%. The petitioner

filed four bills of entry for the remaining 2000 tons on 2 March 2018 and argued

that the revised rate was not applicable to it because the notification was

published in the electronic gazette only on 6 March 2018. The High Court agreed

with the petitioner and held that the revised notification would come into force

only after it was digitally signed by the competent official and uploaded and

published in the official gazette. The relevant excerpt from page 41 of the High

Court’s judgment is quoted below:

                “….The notification was …published electronically on
                6.3.2018. In view of the decision taken by the Government of
                India in terms of Section 8 of the…Information Technology
                Act, to avoid physical printing of Gazette notification to
                publish the same exclusively by electronic mode, so as to
                attribute knowledge to the public at large. The notification was
                signed by Rakesh Sukul on 6.3.2018 at 19:15:13 + 05'30'.
                When notification needs to be signed digitally and only when
                the notification was uploaded and published in the Official
                Gazette, the same is made available for public.”



57      The Madras High Court dealt with a similar situation in Ruchi Soya

Industries vs. Union of India24 and held that the decision of the A.P. High Court

23 W.P. No. 4533 and 4534 of 2019 decided on 28 September 2019 (Andhra Pradesh High Court)
24 W.P. No. 21207 of 2018 decided on 14 July 2020 (Madras High Court).



                                                 68
                                                                                 PART L


noted above was applicable to the case before it. As a result, it allowed the writ

petition on the same terms and directed the Respondent to refund the enhanced

duty collected from the petitioner, along with IGST.


58      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 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.




59      The impugned High Court judgement has relied on the decision of the

Karnataka High Court in Param Industries Ltd. vs. Union of India25, which was

confirmed by the decision of this Court in Union of India vs. Param Industries

Limited26 [“Param Industries”] In that case, the respondents were in the

business of importing and exporting edible oil. The respondents imported RBD

Palmolein which was cleared after payment of import duty of 85 per cent of its

value. The import duty was paid pursuant to a notification which was in existence

as on that date. A major quantity of the goods had been removed from the

warehouse after the payment of duty. The importer was, however, informed that
25 2002 (150) E.L.T. 3 (Kar)
26 (2016) 16 SCC 692

                                           69
                                                                             PART L


by a notification dated 3 August 2001 (incidentally this was also the date the bill

of entry was filed and goods were cleared) the tariff value had been raised to

USD 372 per metric tonne and that the importer was liable to pay the difference

in the tariff which was paid on the basis of the earlier notification. The respondent

contested the demand on the ground that the notification raising the import duty

had not come into effect on 3 August 2001. The Division Bench of the High Court

held that the notification was not published on 3 August 2001 and must have

been Gazetted only after the following weekend namely on 6 August 2001 or

thereafter; the Gazette issued containing notification was offered for sale only

starting from 6 August 2001; and that the mere publication of the notification on

the website and the issuance of a letter to the Assistant Controller, Government

of India (Press) was not sufficient for the notification to be operational and

enforceable on 3 August 2001. This Court in appeal observed that according to

the High Court two conditions were mandatory for the notification to be brought

into force


       (i)    Due publication in the official Gazette; and


       (ii)   Offering the notification for sale on the date of its issue by the

              Directorate of Publicity and Public Relations of the Board, New

              Delhi.


This Court noted that, in their case, the second condition was not satisfied as the

notification was offered for sale only on 6 August 2001 as it was published in the

late evening hours of 3 August 2001 and the next two days were holidays.




                                         70
                                                                                    PART L


60     The decision of this Court in Param Industries was on the interpretation of

Section 14(2) of the Customs Act. However, prima facie, this decision appears to

be contrary to the principles previously elucidated by this Court in the context of

the Customs Act. In a two judge Bench decision of this Court in Pankaj Jain

Agencies vs. Union of India,27 [“Pankaj Jain”] the Court considered the

determination of the date when a notification dealing with an exemption would

come into force. The mode of publication for such notifications is prescribed

separately under Section 25 of the Customs Act. The Court held:

               “17. In the present case indisputably the mode of publication
               prescribed by Section 25(1) was complied with. The
               notification was published in the Official Gazette on the 13-2-
               1986. As to the effect of the publication in the Official Gazette,
               this Court held [Srinivasan case[(1987) 1 SCC 658, 672 : AIR
               1987 SC 1059, 1067] AIR at p. 1067 : SCC pp. 672-73, para
               15]:

               “Where the parent statute is silent, but the subordinate
               legislation itself prescribes the manner of publication, such a
               mode of publication may be sufficient, if reasonable. If the
               subordinate legislation does not prescribe the mode of
               publication or if the subordinate legislation prescribes a
               plainly unreasonable mode of publication, it will take
               effect only when it is published through the customarily
               recognized official channel, namely, the Official Gazette
               or some other reasonable mode of publication.”

               18. We, therefore, see no substance in the contention that
               notwithstanding the publication in the Official Gazette there
               was yet a failure to make the law known and that, therefore,
               the notification did not acquire the elements of operativeness
               and enforceability.”

                                                         (emphasis supplied)



The principles recognized in Pankaj Jain were re-iterated and affirmed by a three

judge Bench of this Court in Union of India vs. Ganesh Das Bhojraj28 which
27 (1994) 5 SCC 198

28 (2000) 9 SCC 461.

                                                71
                                                                                PART L


dealt with the enforceability of a notification under Section 25, prior to its

Amendment by Act 21 of 1998 which inserted Section 25(4) and the requirement

of ‘offering for sale’. The Court separately noted that the newly introduced

requirement of ‘offering of sale’ had prospective application. However, in the

factual scenario concerning a notification governed by the pre-amended act, it

upheld the principle that any additional requirement of publication can only be

introduced by statute and the Court is bound by the applicable statutory scheme

for determining enforceability. It noted:

             “11. In our view, as noted above, in Pankaj Jain Agencies
             case [(1994) 5 SCC 198] the Court directly dealt with a similar
             contention and after relying upon the decision in the case
             of Mayer Hans George [AIR 1965 SC 722 : (1965) 1 Cri LJ
             641 : (1965) 1 SCR 123] rejected the same. That decision is
             followed in I.T.C. Ltd. [(1996) 5 SCC 538] and other matters.
             Hence, it is difficult to agree that the decision in Pankaj Jain
             Agencies case [(1994) 5 SCC 198] was not helpful in deciding
             the question dealt with by the Court. Section 25 of the
             Customs Act empowers the Central Government to
             exempt either absolutely or subject to such conditions,
             from the whole or any part of the duty of customs
             leviable thereon by a notification in the Official Gazette.
             The said notification can be modified or cancelled. The
             method and mode provided for grant of exemption or
             withdrawal of exemption is issuance of notification in the
             Official Gazette. For bringing the notification into
             operation, the only requirement of the section is its
             publication in the Official Gazette and no further
             publication is contemplated. Additional requirement is that
             under Section 159 such notification is required to be laid
             before each House of Parliament for a period of thirty days as
             prescribed therein. Hence, in our view Mayer Hans
             George [AIR 1965 SC 722 : (1965) 1 Cri LJ 641 : (1965) 1
             SCR 123] which is followed in Pankaj Jain Agencies
             case [(1994) 5 SCC 198] represents the correct exposition
             of law and the notification under Section 25 of the
             Customs Act would come into operation as soon as it is
             published in the Gazette of India i.e. the date of
             publication of the Gazette. Apart from the prescribed
             requirement under Section 25, the usual mode of
             bringing into operation such notification followed since
             years in this country is its publication in the Official

                                             72
                                                                             PART L


             Gazette and there is no reason to depart from the same
             by laying down additional requirement.”

                                                (emphasis supplied)




61    Param Industries, in as much as it imposed an additional requirement of

‘offering for sale’, outside of the prescribed statutory scheme under S.14(2) of the

Customs Act, 1962, appears to be contrary to pre-existing principles. Having said

this, we do not wish to rule on the validity of Param Industries or its consequent

impact on decisions that have relied on it. In the present judgment it is not

necessary to take recourse to the line of reasoning in Param Industries. The

situation at hand, operates on a landscape which is significantly altered by the

regulatory regime in the electronic age where, both – uploading of notifications in

the e-gazette and filing of bills of entry- are in the electronic form. As we have

previously noted, Notification 5/2019 was uploaded in the e-gazette at a specific

time and date and cannot apply to bills of entry which were presented on the

customs automated EDI system prior to it, attracting the legal fiction set out in

Regulation 4(2) of the 2018 Regulations. Therefore, Param Industries does not

have any bearing on the case at hand.




                                         73
                                                                            PART M


M     Retrospectivity


62    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”. By the notification dated 16 February 2019, the Union Ministry

of Finance in the Department of Revenue introduced a distinct tariff item – 980 60

000 - encompassing “all goods originating in or exported from the Islamic

Republic of Pakistan” for which a rate of duty of 200 per cent has been

prescribed. 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.

63    Section 8A enables the Central government to increase the rate of duty on

an article in the first schedule in emergent situations. The notification dated 16

February 2019 adds a new entry altogether. Such an exercise may well be

regarded as relatable to the provisions of Section 11A. Section 11A confers a

power on the Central Government to amend the First schedule in public interest.

                                        74
                                                                             PART M


Section 8A on the other hand contemplates an increase in duty on an article

contained in the First schedule. Notification 5/2019 introduces a new tariff entry to

provide for a duty of 200% on all articles originating in or exported from Pakistan.

However, this aspect of the matter need not be explored further for the reason

that neither before the High Court, nor before this Court, was the challenge to the

vires of the notification pressed during the course of the submissions. The legal

position which needs emphasis is that 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.




64    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 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. In a decision which was rendered in 1961

by a Constitution Bench of this Court in Chief Inspector of Mines vs. Lala




                                          75
                                                                                 PART M


Karam Chand Thapar29, the principle of law was formulated in the following

terms:

              “20. The true position appears to be that the rules and
              regulations do not lose their character as rules and
              regulations, even though they are to be of the same effect as
              if contained in the Act. They continue to be rules subordinate
              to the Act, and though for certain purposes, including the
              purpose of construction, they are to be treated as if contained
              in the Act, their true nature as subordinate rule is not lost….”



In K I Shepard vs. Union of India30, a two judge Bench of this Court held that the

power to frame a scheme under Section 45 of the Banking Regulation Act 1949

was not legislative in character but an administrative function. This Court

observed:

              “9…But is the scheme-making process legislative? Power has
              been conferred on the RBI in certain situations to take steps
              for applying to the Central Government for an order of
              moratorium and during the period of moratorium to propose
              either reconstruction or amalgamation of the banking
              company. A scheme for the purposes contemplated has to be
              framed by RBI and placed before the Central Government for
              sanction. Power has been vested in the Central Government
              in terms of what is ordinarily known as a Henry VIII clause for
              making orders for removal of difficulties. Section 45(11)
              requires that copies of the schemes as also such orders
              made by the Central Government are to be placed before
              both Houses of Parliament. We do not think this requirement
              makes the exercise in regard to schemes a legislative
              process.”




The above decision was distinguished in New Bank of India Employees’ Union

vs. Union of India31 [“New Bank of India”] where the court held that a scheme

framed under Section 9 of the Banking Companies (Acquisition and Transfer of
29 AIR 1961 SC 838
30 (1987) 4 SCC 431
31 (1996) 8 SCC 407

                                              76
                                                                           PART M


Undertakings) Act 1980 stands on a distinct footing of being a legislative and not

an administrative function. The court held that the question was not of much

relevance in view of its conclusions on the main issues presented for decision.

Yet, it considered the question and laid emphasis on the authority entrusted to

Parliament to consider, within 30 days, to agree/modify/arrive at any decision with

regards to the scheme, only thereafter was the scheme was to have effect. These

requirements, qualitatively distinguished from a requirement of mere ‘laying’

under Section 45 of the Banking Regulation Act 1949, were pivotal in the court’s

view that a scheme under the 1980 Act has a legislative character. Mr Natraj

sought to emphasize a similar argument, by placing reliance on the provisions of

sub-sections (3) and (4) of Section 7 which are made applicable by reason of

sub-section (2) of section 8A. However, in the absence of a sine qua non for

parliamentary sanction before the notification is enforceable, the decision of New

Bank of India provides little anchor. For the purpose of the present decision the

point which needs emphasis is that 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.




                                        77
                                                                                    PART M


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. In Hukum

Chand vs. Union of India32, a three judge Bench of this Court held that:

              “8…The extent and amplitude of the rule-making power would
              depend upon and be governed by the language of the
              section. If a particular rule were not to fall within the ambit and
              purview of the section, the Central Government in such an
              event would have no power to make that rule. Likewise, if
              there was nothing in the language of Section 40 to empower
              the Central Government either expressly or by necessary
              implication, to make a rule retroactively, the Central
              Government would be acting in excess of its power if it gave
              retrospective effect to any rule. The underlying principle is
              that unlike Sovereign Legislature which has power to
              enact laws with retrospective operation, authority vested
              with the power of making subordinate legislation has to
              act within the limits of its power and cannot transgress
              the same. The initial difference between subordinate
              legislation and the statute laws lies in the fact that a
              subordinate law-making body is bound by the terms of
              its delegated or derived authority and that Court of law,
              as a general rule, will not give effect to the rules, thus
              made, unless satisfied that all the conditions precedent
              to the validity of the rules have been fulfilled.”

                                                       (emphasis supplied)



65     The distinction between the plenary power which is 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 has been maintained in a consistent line of

precedent of this Court. In Regional Transport Officer, Chittoor vs. Associated

Transport Madras (P)33, Justice V.R. Krishna Iyer speaking for a two judge

Bench of this Court with his characteristic eloquence observed:

32 (1972) 2 SCC 601
33 (1980) 4 SCC 597

                                                78
                                                                                   PART M


              “4. The legislature has no doubt a plenary power in the matter
              of enactment of statutes and can itself make retrospective
              laws subject, of course, to the constitutional limitations. But it
              is trite law that a delegate cannot exercise the same power
              unless there is special conferment thereof to be spelled out
              from the express words of the delegation or by compelling
              implication. In the present case the power under Section 4(1)
              does not indicate either alternative…...”



The Court held that 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:

              “4…The mere fact that the rules framed had to be placed on
              the table of the legislature was not enough, in the absence of
              a wider power in the section, to enable the State Government
              to make retrospective rules. The whole purpose of laying on
              the table of the legislature the rules framed by the State
              Government is different and the effect of any one of the three
              alternative modes of so placing the rules has been explained
              by this Court in Hukam Chand v. Union of India [(1972) 2
              SCC 601, 606 : (1973) 1 SCR 896, 902].”



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.


In Federation of Indian Minerals Industries vs. Union of India34, a three judge

Bench of this Court formulated the principles on the subject. Justice Madan B


34 (2017) 16 SCC 186

                                               79
                                                                               PART M


Lokur observed that the power to frame subordinate legislation is not

retrospective unless it is authorized expressly or by necessary implication by the

parent statute. The Court observed:



             “26…The relevant principles are:
             (i) The Central Government or the State Government (or any
             other authority) cannot make a subordinate legislation having
             retrospective effect unless the parent statute, expressly or by
             necessary implication, authorises it to do so. [Hukam
             Chand v. Union of India [Hukam Chand v. Union of India,
             (1972) 2 SCC 601] and Mahabir Vegetable Oils (P)
             Ltd. v. State of Haryana [Mahabir Vegetable Oils (P)
             Ltd. v. State of Haryana, (2006) 3 SCC 620] ].
             (ii) Delegated legislation is ordinarily prospective in nature
             and a right or a liability created for the first time cannot be
             given retrospective effect. (Panchi Devi v. State of
             Rajasthan [Panchi Devi v. State of Rajasthan, (2009) 2 SCC
             589 : (2009) 1 SCC (L&S) 408] )
             (iii) As regards a subordinate legislation concerning a fiscal
             statute, it would not be proper to hold that in the absence of
             an express provision a delegated authority can impose a tax
             or a fee. There is no scope or any room for intendment in
             respect of a compulsory exaction from a citizen. [Ahmedabad
             Urban       Dev.    Authority v. Sharadkumar      Jayantikumar
             Pasawalla [Ahmedabad Urban Dev. Authority v. Sharadkumar
             Jayantikumar Pasawalla, (1992) 3 SCC 285] and State of
             Rajasthan v. Basant     Agrotech      (India)  Ltd. [State  of
             Rajasthan v. Basant Agrotech (India) Ltd., (2013) 15 SCC 1]”




                                             80
                                                                               PART N


The judgment of Justice Dipak Misra (as he then was) speaking for a two judge

Bench decision in State of Rajasthan vs. Basant Agrotech (India) Ltd35 adopts

the same position.




N      Summation


66     The imposition of a tax encompasses three stages. The locus classicus on

the subject is embodied in the dictum of Lord Dunedin in Whitney vs.

Commissioners of Inland Revenue36 which has been consistently applied in the

decisions of this court. 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. (See in this context the decisions

of the Federal Court in Chatturam v. CIT, Bihar37 and of this Court in A V

Fernandez vs. State of Kerala38 and Deputy CTO vs. Sha Sukraj Peerajee39.

67     In the present case the twin conditions of Section 15 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


35 (2013) 15 SCC 1
36 (1926) AC 37 at 52.
37 (1947) FCR 116 at 126
38 1957 SCR 837 at para 39
39 (1967) 3 SCR 661 at para 5

                                          81
                                                                               PART N


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 re-

assessment 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.

68    For the above reasons, we have come to the conclusion that there is no

merit in the appeals. The appeals shall stand dismissed. There shall be no order

as to costs.

69    Pending application(s), if any, stands disposed of.



                                        …………...…...….......………………........J.
                                        [Dr Dhananjaya Y Chandrachud]




                                        …..…..…....…........……………….…........J.
                                        [Indu Malhotra]

New Delhi;
September 23, 2020.




                                         82
                                                 Reportable


                IN THE SUPREME COURT OF INDIA
                 CIVIL APPELLATE JURISDICTION


             CIVIL APPEAL NO.         OF 2020
            (@ S.L.P.(CIVIL)No. 3860 of 2020)



UNION OF INDIA AND OTHERS               ... APPELLANT(S)

                           VERSUS

M/S. G.S. CHATHA RICE MILLS
AND ANOTHER                             ... RESPONDENT(S)

                            WITH

                      CONNECTED MATTERS

                     J U D G M E N T

K.M. JOSEPH, J.

1. Does a notification under Section 8A of the

Customs Tariff Act, 1975 increasing the import duty

published late in the evening of 16th Feb 2019, date

back to the midnight of the previous day? Does a day

include its fractions? While I agree with my esteemed

and learned brother in his erudite judgment that the

appeals be dismissed, having regard to the questions

1
involved, I have written the following separate

opinion:

2. Following the terror attack at Pulwama on

14.02.2019, the Government of India published a

Notification on 16.02.2019 (hereinafter referred to

as ‘the Notification’) purporting to be in exercise

of powers under Section 8A(1) of the Customs Tariff

Act, 1975 (hereinafter referred to as ‘the Tariff

Act’, for short). By the same, the First Schedule to

the Tariff Act, 1975 came to be amended in the

following manner:

“In the First Schedule to the Customs
Tariff Act
, in Section XXI, in Chapter 98,
after tariff item 9805 90 00 and the
entries relating thereto, the following
tariff item and entries shall be inserted,
namely:-

           (1)               (2)                (3)   (4)          (5

                                                                   )

                “9806        All   goods         -         200%    -“
                             originatin                             .
                00 00        g   in   or
                             exported
                             from    the
                             Islamic
                             Republic
                             of

                                     2
                             Pakistan.

3.    It    came       to    be    published     in    the    Gazette     at

20:46:58 hrs. on 16.2.2019.


4.   On    the    same       day,     i.e.,     on     16.02.2019,      the

respondents      in     the        Appeals,     who    were     the     Writ

Petitioners      before the          High Court,       filed Bills        of

Entry under the Customs Act, 1962 in respect of goods

imported from Pakistan. In fact, there was an

agreement between India and Pakistan, both being

SAARC Countries, under which, duty was to be levied

on the imports from Pakistan at concessional rates,

in those cases where imports were exigible to any

duty at all. The goods which were subject matter of

import, had also arrived in the Customs Station and

as noticed, during the course of the working hours on

16.02.2019 and well before the time of the

Notification hereinbefore adverted to, the Bills of

Entry came to be presented. The duty came to be self-

assessed by the respondents. It is, thereafter, that

taking inspiration from the hefty increase in duty

effected under the Notification the Writ Petitioners

3
came to be faced with reassessment proceedings. It is

accordingly that they approached the High Court and

filed Writ Petitions wherein the prayer may be

noticed in Writ Petition No. 18460 of 2019 as

follows:

           “a) Writ     in     the       nature      of
               certiorari/mandamus    or   any    other

appropriate writ for quashing of the
assessment order passed in the bill
of entry no. 2083178 dated 16.02.2019
(Annexure-P5) being illegal
arbitrary, against the principles of
natural justice and in violation to
the provisions of article 14 & 19 of
the Constitution of India and against
the provisions of Section 128 & 129
of the Customs Act, 1962;

           b)    Writ      in     the      nature     of
                 certiorari/mandamus     quashing    the

notification no. 05/2019-cus dated
16.02.2019 (Annexure-P7) being
prospective and in contravention to
the Notification no. 50/2017-cus.
dated 30.06.2017 granting benefit of
customs duty over and above NIL% as
well as section 4 & 11 of the Customs
Tariff act, 1975,

c) Writ in the nature of certiorari/
mandamus directing the Respondent
No.3 to issue detention memo in terms
of Regulation 6(1)(1) of the Customs
Act
, 1962 and further directing the
Respondent No. 4 to release the goods
without demanding any ground rent.

4

d) Writ in the nature of certiorari/
mandamus restraining the respondent
no.4 for conducting auction of the
goods.

5. It is these Writ Petitions which have been

allowed by the High Court.

6. The High Court has found that in the Scheme of

the Customs Act read with the Tariff Act, the rate of

duty is to be determined with reference to two

definite indicia, viz., the date of presentation of

the Bills of Entry and the movement of goods across

the border and availability of the same within the

Customs Station. Present these two aspects, the law

enables the importer to demand that payment of the

duty be with reference to the date of presentation of

the Bills of Entry. The High Court did not consider

the challenge to the Notification on the basis of the

stand taken by the respondents and confined its

reasoning to the aforesaid aspect which I have

indicated. The Court took the view that the

Notification which came to be published late in the

evening on 16.02.2019 could not alter the destiny of

5
the Writ Petitioners cases as regards the rate of

duty.

7. We have heard Shri K.M. Nataraj, learned

Additional Solicitor General, appearing on behalf of

the appellants, Shri P.S. Narsimha, learned Senior

Counsel, appearing on behalf of the Writ Petitioners.

CONTENTIONS OF THE APPELLANTS

8. Shri K.M. Nataraj, learned Additional Solicitor

General would contend that the Notification issued

under Section 8A of the Tariff Act following the

extraordinary circumstances surrounding the Pulwama

terror attack, the rate of duty came to be increased

by Notification dated 16.02.2019. The Notification

would have effect in respect of all the Bills of

Entry which came to be filed/presented on that day.

To buttress his submissions, he also sought to draw

support from Section 5(3) of the General Clauses Act,

1897. He would point out that the Notification would,

therefore, have effect from the expiry of the

previous day. That is, it is his contention that

6
though it is issued late in the evening on

16.02.2019, since the previous day, viz., 15.02.2019

expired at midnight, the Notification must be treated

as born and alive from the first tick of time past

the midnight of 15.02.2019. He also drew our

attention to the Scheme of the Customs Act, 1962

otherwise. With the assistance of Sections 12, 15, 46

and 47, he sought to contend that the High Court fell

into error in not recognizing that the preferring of

the Bills of the Entry by the respondents, could not

detract from the applicability of the increased rate

of duty under the Notification.

9. The principal argument of the Union of India is

that these cases must be decided based on the

provision of Section 15 of the Customs Act.

Expatiating the argument of the Union of India Shri

K.M. Nataraj, learned counsel for the Union of India-

appellant would contend that there is no challenge to

the validity of Section 15 of the Customs Act. The

said provision must be taken as it is and applied.

The result would then be inevitable that the

notification in question which no doubt was published

7
late in the evening on 16.02.2019, fixed the

increased rate of duty on all goods imported from

Pakistan and it was undoubtedly to have effect from

that day onwards. In other words, since Section 15

of the Act contemplates that the rate of duty to be

the rate in force during the day, and as the

Notification was published on 16.02.2019, the day

16.02.2019 was not to be excluded. It was, in other

words, to have operation throughout the day,

16.02.2019. It is contended that there cannot be two

rates of duty which are at loggerheads with each

other on a single day. The time of the day at which

the notification was actually published, would pale

into insignificance in answering the question as to

whether the said notification which is of the kind

involved in this case was to hold sway during the

course of the whole day. He urges us to notice that

Section 15 of the Customs Act does not allude to the

time of the day but only refers to the day. He would

further contend that by virtue of the notification,

the rate in force within the meaning of Section 15

from the mid night of 15.02.2019 was the rate fixed

8
under the notification in respect of the goods

governed by the same. Any other interpretation would

involve rewriting of Section 15 and the

amendment of the provision which is plainly

impermissible. He also no doubt points that the

authorities have rightfully embarked upon

reassessment under the Act upon noticing that the

goods were assessed with duty at a rate which was not

in force, namely, the rates which stood supplanted by

the notification issued under Section 8A on

16.02.2019. In this regard he drew inspiration from

the provisions of Section 17(4) of the Act. In

particular, he pointed out that the expression

“otherwise” is capable of encompassing the situation

existing in the facts of these cases. He would also

point out that the Court may notice that an order has

not been passed under Section 47 of the Act

permitting clearance of the goods for home

consumption. As soon as the factum of the

notification having bearing came to light,

proceedings for re-assessment were resorted to and no

case was made out for the High Court to interfere

9
with the action of the authorities in purporting to

apply the correct rate of duty within the meaning of

Section 15 of the Act.

10. Per contra, Shri P.S. Narsimha, learned Senior

Counsel for the respondent-Writ Petitioners,

countered the appellants submissions by pointing out

as follows:

Under Section 12 of the Customs Act,

imports attract customs duty as is fixed

under the Tariff Act. Section 15 of the

Customs Act, however, determines the date

with reference to which the rate of duty as

provided in the Tariff Act is to apply. Still

further and crucially, this exercise is to be

accomplished with reference to the date of

presentation of the Bills of Entry as

provided in Section 46 of the Customs Act. He

would, in fact, submit that under the Customs

Act, a perusal of Sections 15 and 16, would

show that there are four different situations

10
contemplated. Under Section 15, which deals

with rate of duty payable on imports, in a

case where the Bills of Entry is presented

for home consumption under Section 46, the

rate of duty is to apply with reference to be

date of presentation of the Bills of Entry.

In the case where the goods are cleared for

being warehoused under Section 68, again the

duty is to be paid at the rate with reference

to the presentation of the Bills of Entry for

home consumption under Section 68. The two

other circumstances pertain to exports. In

the case of goods entered for export from

India, the rate of duty is fixed with

reference to the date on which the proper

officer makes an order permitting clearance

and loading of goods for exportation under

Section 51. In any other case, which is the

fourth Category, the duty is fixed with

reference to the date of payment of duty. He

would draw our attention to the

Electronic Filing of Bills of Entry

11
Regulations, 2018. In particular, he would

draw our attention to Regulation 4 of the

said Regulations. He would point out that

Regulation 4, of the said Regulations, makes

it clear that once the Bills of Entry is

filed electronically and the event takes

place, which under law determines the point

of time with reference to which the rate of

duty is to be imposed, the position is

unalterable. He would submit that neither is

the rate of duty dependent on the date of

payment of duty nor is it based on Entry

Inward. An order is contemplated under

Section 47 of the Customs Act for clearing

the goods, which contemplates payment of duty

as a condition precedent for such an order.

This is irrelevant. He would submit that in

the present-day world of international trade,

innumerable transactions take place at

different points of time during the course of

the day. The Law Giver has not contemplated

the reopening of a transaction, which in the

12
eye of law, is a closed chapter. He would

point out that the court must bear in mind

that it is dealing with a law which visits a

person with a tax. The point of time is

transparent and declared through the Scheme

of the Customs Act read with the Tariff Act.

It would be wholly impermissible to inflict

imports which have been visited with the duty

in accordance with the law, with the rates of

duty, which was not prevalent at the relevant

time. The Notification could have only

prospective operation. In fact, Shri Kapoor,

the learned Counsel, who appeared in the High

Court for the Writ Petitioners, pointed out

that after the Notification was issued late

in the evening, the system did not accept

further electronic declaration of Bills of

Entry as it was contemplated that such Bills

of Entry would attract the higher duty.

11. Mr. P.S. Narsimha, learned Senior Counsel, points

out that Customs Act contemplates self-assessment.

13
He drew our attention to Section 17 in this regard.

It is the further case of the writ petitioners that

based on the self-assessment, the system generated

details which approved of the self-assessment. After

the matter stood concluded in terms of the Act, the

transaction could not be revisited on the strength of

the Notification issued under Section 8A, runs the

argument. It is pointed out that the Notification,

issued under Section 8A, may be akin to delegated

legislation. Even proceeding on the basis that it

is delegated legislation, it can have only

prospective operation. Section 8A of the Tariff Act,

under which the Notification was issued, did not

empower the author of the Notification to issue the

Notification with retrospective effect. In answer to

a query by the Court as to what would have been the

effect of the notification which was issued at

10.00a.m. at 16.02.2019, instead of 20:46:58 hrs., at

which time, it was in fact issued and if the Bill of

Entry is presented after 10.00 a.m., Mr. P.S.

Narsimha pointed out that it would be the

Notification which was issued on 10.00 a.m., which

14
would be the Notification in force, and therefore,

the increased duty may have been payable. Mr. P.S.

Narsimha has also, no doubt, a contention that the

Notification issued under Section 8A is illegal for

the reason that what is contemplated under Section 8A

is the increase of the rate of duty in respect of

items which are already included in the first

schedule of the Tariff Act whereas a perusal of the

Notification would show that a new entry has been

made and the rate of duty has been provided therein,

viz., the rate of duty of all goods emanating from

Islamic Republic of Pakistan was increased to 200 per

cent. But this line of argument was not pursued.

12. Both sides referred us exhaustively to case law.

ANALYSIS

13. The Customs Act is a consolidating Act. It is

intended, inter alia, to deal with the menace of

smuggling. It contains various sanctions. It also

provides for the levy of Customs duty on import and

export. It is a law which provides revenue to the

15
State. It is also an important tool in the hands of

the nation to arrange its economic affairs to make it

best suited to the welfare of the people otherwise.

Indisputably, the charging Section is Section 12.

The taxable event is import into or export of goods

from India. Ordinarily, the Tariff Act provides the

rates at which duty is imposed on imports and

exports. There is no dispute that India and Pakistan

being S.A.A.R.C. Countries they were parties to an

agreement under which the trade between the countries

was subjected only to duty on concessional rates. It

is while so, following the unfortunate incident of

Pulwama that the Government of India in exercise of

its powers under Section 8A of the Tariff Act decided

to increase the rate of import duty on all goods in

the manner done. The Notification was issued on

16.02.2019. It was published at about 20:46:58 hrs.

In the meantime, during the course of the day, the

writ petitioners before us who imported goods had

filed Bills of Entry electronically. The goods were

present in the Customs Station. To be more correct,

the Bills were presented and self-assessment was

16
undertaken. It is thereafter that late in the

evening as a bolt from the blue, as it were, the

notification came to be issued under Section 8A of

the Tariff Act. The questions which arise for the

consideration of this Court is articulated as

follows:

1. What is the nature of the Notification? Is it

a species of subordinate legislation?

2. If it is subordinate legislation, when did it

commence? What is the scheme of the Customs

Act as regards the rate of duty on imports and

the power of assessment? Was the Notification

in force on 16.02.2019 so that it would cover

all the transactions countenanced by the Bills

of Entry which were duly presented during the

office hours on 16.02.2019? What constitutes a

day under Section 15 of the Customs Act?

3. Whether the Notification is covered by Section

5(3) of the General Clauses Act?

17

4. Whether the appellants were justified in

resorting to re-assessment in these cases?

THE TARIFF ACT AND WHETHER THE NOTIFICATION IS A FORM
OF DELEGATED LEGISLATION

14. It is apposite that the working of the Tariff Act

is unravelled. The rates of duty under the Customs

Act are to be provided as per the entries in the

First and Second Schedule. Section 2 of the Tariff

Act, reads as follows:

“2. Duties specified in the Schedules to
be levied. – The rates at which duties of
customs shall be levied under the Customs
Act
, 1962 (52 of 1962), are specified in
the First and Second Schedules.”

15. In other words, the rate of duty must be one

which is provided by Parliament. It may require an

amendment to the Tariff Act to increase or decrease

the rate of duty under Section 2. Section 11A

contemplates power with the Central Government to

amend the First Schedule. It cannot be, in the region

of doubt, that the exercise of power under Section

11A would amount to exercise of delegated

legislation. Section 11A(2) stipulates the procedure

18
to be adopted after the Notification is issued. It

has to be placed before each House of Parliament and

the further procedures are as provided therein, which

includes the power to modify the Notification. The

proviso, however, makes it clear that the exercise of

power under Section 11A, to amend the First Schedule,

will not involve or amount to an increase in the

rates which are specified in the First Schedule in

regard to duties of customs leviable under the

Customs Act. In other words, barring the rate of

customs duty, the contents of the First Schedule can

be amended by the Central Government under Section

11A. Resultantly, Section 11A does not confer upon

the Central Government, the power to increase the

rate of duty under the Customs Act. The rate of duty,

in other words, ordinarily falls within the province

of Parliament, and it is Parliament alone, which can

increase or decrease the rate of duty. However, an

exception has been carved out under Section 8A to

change the rate of duty under the Schedule to the

Tariff Act. It is an emergency power vested with the

Central Government. The emergency power vested with

19
the Central Government is to change the import duty

and the change is limited to an increase in the rate

of import duty. The condition requisite is, no doubt,

that circumstances exist which render it necessary to

take immediate action for providing for an increase

in the import duty. Section 8A, in fact, does not

contemplate the power to amend the First Schedule.

The power under Section 8A is confined to any article

which is already included in the First Schedule.

Undoubtedly, it is the same Authority, viz., the

Central Government, which stands clothed with the

power to amend the First Schedule under Section 11A.

The words “circumstances” exists which render it

necessary to take immediate action in Section 8A

makes it clear that the power to increase the rate of

import duty is ordinarily a power to be exercised by

the Parliament by a process of amending the First

Schedule to the Tariff Act. It is only in emergent

circumstances where the delegate of the Legislature,

viz. the Central Government, considers it necessary

to take immediate action that is the process of

amending the Act or rather the Schedule to the Act by

20
the Parliament, would take time, the same is sought

to be obviated by taking action under

Section 8A. Undoubtedly, the provisions of Sections

7(3) and 7(4) will apply in making of the

Notification.

16. On a perusal of the provisions, as noted, it is

clear that a Notification issued under Section 8A,

increasing the import duty, is a species of delegated

legislation. It must be remembered that Article 265

of the Constitution of India declares that no tax

shall be levied except by the authority of Law. An

increase in the rate of duty cannot obviously be

affected by an Executive Order. That is not to say

that when the Executive is empowered to increase the

rate of duty by way of delegated legislation, it

would not fulfill the requirement of Article 265 and

there can be no hesitation in holding that it is law

within the meaning of Article 13 of the Constitution

of India and it is a species of delegated

legislation. [See in this regard AIR 1961 SC 21 para

11]

21
THE SCHEME OF THE CUSTOMS ACT QUA RATE OF DUTY ON
IMPORTS AND ASSESSMENT TO DUTY

17. Section 12 is the charging Section. It reads as

follows:

“12. Dutiable goods.— (1) Except as
otherwise provided in this Act, or any
other law for the time being in force,
duties of customs shall be levied at such
rates as may be specified under the
Customs Tariff Act, 1975 (51 of 1975), or
any other law for the time being in force,
on goods imported into, or exported from,
India.

(2) The provisions of sub-section (1)
shall apply in respect of all goods
belonging to Government as they apply in
respect of goods not belonging to
Government.”

18. Section 15 deals with the date relevant to fix

the rate of duty. It reads as follows:

“15. Date for determination of rate of
duty and tariff valuation of imported
goods.—(1) The rate of duty and tariff
valuation, if any, applicable to any
imported goods, shall be the rate and
valuation in force,—

22

(a) in the case of goods entered for
home consumption under section
46
, on the date on which a bill
of entry in respect of such goods
is presented under that section;

(b) in the case of goods cleared from
a warehouse under section 68, on
the date on which a bill of entry
for home consumption in respect
of such goods is presented under
that section;

(c) in the case of any other goods,
on the date of payment of duty:

Provided that if a bill of entry has
been presented before the date of
entry inwards of the vessel or the
arrival of the aircraft or the
vehicle by which the goods are
imported, the bill of entry shall be
deemed to have been presented on the
date of such entry inwards or the
arrival, as the case may be.

(2) The provisions of this section shall
not apply to baggage and goods imported by
post.”

19. In the matter of imports, the rate of duty, which

is the sole area of controversy, is to be determined

on the basis of the rate of duty which is in force on

the day of the presentation of the Bill of Entry. It

will be further noticed that an importer may, when
23
the goods are physically present within the Customs

Station in question, file the Bill of Entry for home

consumption. Section 46(1) also contemplates the

presentation of the Bill of Entry for the goods being

warehoused. This ordinarily would occur when the

importer may have difficulty in paying the duty on

the goods. He may also warehouse the goods when he

has not yet found a buyer for his goods or there are

any other obstacles in clearing the goods. Cases of

goods imported for the purpose of being taken out of

the country by way of transshipment or goods intended

for transit, are not covered by Section 46 (1). The

Bill of Entry under sub-Section (1) is to be

presented before the expiry of the day following the

day (excluding holidays) on which the aircraft,

vessel or vehicle carrying the goods arrives at a

Customs Station, at which the goods are to be

cleared, either for home consumption or warehousing

[See Section 46(3)]. The Second Proviso to Section

46(3) provides that if the Bill of Entry is not

presented within the time specified and there are no

sufficient reasons for such delay, the importer is to

24
pay charges for late presentation. The importer is

also to make a declaration regarding the truth of the

contents of the Bill of Entry, and in support of the

same, he is to produce the invoice and other

documents, as may be prescribed. [See Section 46 (4)]

20. The next procedure contemplated under the Customs

Act in regard to an importer entering any imported

goods under Section 46 for home consumption is for

the importer to carry out self-assessment except in a

situation covered by Section 85 [See Section 17(1)].

The proper Officer is to verify the entries in the

Bill of Entry entered under Section 46, inter alia,

and the self-assessment of the goods carried out by

the importer. He is clothed with the power to examine

or test any imported goods, inter alia, for the

purpose of such verification. The importer is to

furnish any document for verification, as may be

necessary towards the carrying out of the

verification [See Section 17(3)]. It is thereafter

that Section 17(4) empowers the Officer who carries

out the verification to re-assess the duty leviable

on such goods. The perusal of Section 17(4) would

25
reveal that such re-assessment can be done, when, on

verification, examination or testing of the goods,

the officer finds that the self-assessment is not

done correctly. Section 17(4) also employs the

expression “otherwise” after the words “verification,

examination or testing of the goods”. It is argued by

the learned Additional Solicitor General that the

word “otherwise” is attracted in the facts of this

case as it is found that the issuance of the

Notification on 16.02.2019 albeit in the late evening

determined the rate of duty in respect of all Bills

of Entry which may have been presented during the

course of the day and re-assessment was legally

permissible as it fell within the wide embrace of the

word “otherwise”. This question will be answered

after examining, considering and answering the

question as to when the Notification commenced. It

may also be noticed that Section 18(1)(a), which

provides that notwithstanding anything contained in

the Act but without prejudice to Section 46, that the

Officer may carry out provisional assessment. Under

Section 18(1)(a) such provisional assessment is

26
permitted when the importer, inter alia, is unable to

make the self-assessment under Section 17(1), and

what is more, makes a request in writing to the

proper Officer for provisional assessment.

21. There are three other circumstances enumerated in

clause (b), (c) and (d) of Section 18(1) which

entitle the Officer to pass an Order of provisional

assessment. In such a case, it is open to the Officer

to carry out the final assessment. So also, it is

open to the Officer to carry out re-assessment.

22. What is the time at which the importer who

presents a Bill of Entry under Section 46 for home

consumption is to effect payment of the import duty,

when he carries out self-assessment? This question is

answered in Section 47(2)(a) which provides that the

importer is to pay the import duty on the very day of

presentation of the Bill of Entry when the importer

carries out self-assessment as is contemplated under

Section 17(1) of the Act.

23. Section 47(1) contemplates that where the Officer

is satisfied about the goods entered for home

27
consumption, being not prohibited goods, and the

importer has paid the import duty, if any, assessed

thereon, and other charges, under the Act, he is to

pass an Order permitting clearing of goods for home

consumption. It is again to be noted that under

Section 47(2)(b), the importer is to pay the duty

within one day from the date on which the Bill of

Entry is returned to him when there is assessment,

re-assessment or provisional assessment. Section

47(1)(c) also contemplates permitting the importer to

make deferred payment which is permitted under the

Second Proviso to Section 47(1).

24. What is the effect of non-payment of the duty

within the time specified in Section 47(2)? The

answer to this also is contained in Section 47(2)

itself as the law mandates that the importer shall

pay interest on the duty not paid or short paid till

the date of its payment at the rate as provided

therein. It is to be noticed that Section 47 is

related to goods entered for home consumption. No

doubt without payment, an order for clearance of

goods would not be passed.

28

25. Section 28 of the Customs Act provides for

recovery of duties not levied, not paid, short

levied, short paid or erroneously refunded. Similar

provisions are contained in the Central Excise Act as

well. It is also noteworthy that Section 2(25)

defines the word “imported goods” as meaning the

goods brought into India from the place outside India

but it does not include the goods which have been

cleared for home consumption.

26. A perusal of Section 15(1)(a) makes it clear that

as far as goods entered for home consumption under

Section 46, the rate of duty is to be the rate of

duty in force on the date on which the Bill of Entry

in respect of such goods is presented under Section

46. It is not the date on which the goods are ordered

to be cleared under Section 47. In fact, the Scheme

of the Act, in regard to goods entered for home

consumption, is that the importer is to present the

Bill of Entry, as contemplated under Section 46, he

is to make self- assessment under Section 17(1), he

is to make the payment of the duty on the day on

which he presents the Bill of Entry under Section

29
47(2)(a). Should he fail to make the payment on the

same day in the case of self- assessment, he becomes

liable to pay interest as provided till the date of

payment. What is crucial is, however, that only that

date is relevant on which he presents the Bill of

Entry for home consumption in the form and in the

manner, which is prescribed. The word “prescribed”

has been defined in Section 2(32) to mean prescribed

by Regulations made under the Act. Regulations have

been made in regard to presentation of Bill of Entry.

Section 46(1) would reveal that the word

“electronically” came to be inserted by Act 8 of 2011

w.e.f. 08.04.2011. Immediately following the words

“electronically, the words “at the customs automated

system”, have been inserted by the Finance Act, 2018

w.e.f. 01.04.2018. The words “in such form and

manner, as may be prescribed” came to substitute the

words “in the prescribed form”, by the Finance Act,

2018. No doubt, the First Proviso to Section 46(1)

empowers the Principal Commissioner of Customs or the

Commissioner of Customs to allow the Bill of Entry to

30
be presented in any other manner, where it is not

feasible to make the entry electronically.

27. The Regulations holding the field providing for

the form and manner in which the Bill of Entry is to

be presented for home consumption under Section 46(1)

of the Customs Act are called the Bill of Entry

(Electronic Integrated Declaration and paperless

Processing) Regulations, 2018 (hereinafter referred

to as ‘the 2018 Regulations”, for short). Regulation

4(2), which is the relevant Regulation, reads as

follows:

“4(2) The bill of entry shall be deemed to
have been filed and self-assessment
completed when after entry of the
electronic integrated declaration on the
customs automated system or by way of data
entry through the service centre, a bill of
entry number is generated by the Indian
Customs Electronic Data Interchange System
for the said declaration and the self-
assessed copy of the Bill of Entry may be
electronically transmitted to the
authorised person or printed out at the
service centre.”

28. A perusal of the aforesaid Regulation makes it

clear that there is not only a deemed presentation of

31
the Bill of Entry which the law calls into existence,

as provided therein but also completion of self-

assessment. This deemed presentation and completed

self-assessment takes place when the bill of entry

number is generated. Once there is a deemed

presentation of the Bill of Entry, then, under

Section 15(1)(a), the rate of duty, which is in force

on such deemed date of presentation, would be the

rate which is applicable. This is, no doubt, subject

to the further requirement that the goods are

physically present in the Customs Station. This is

for the reason that under the First Proviso to

Section 46(3), an importer can present a Bill of

Entry in anticipation of the arrival of the goods

provided that the presentation of such Bill of Entry

is limited to a period not exceeding thirty days

prior to the expected arrival. However, in case,

where the Bill of Entry is presented under the First

Proviso to Section 46(3), the rate of duty will be

determined with reference to the act of presentation

of the Bill of Entry, but such presentation of the

Bill of Entry is by a deeming fiction made only from

32
the date of the entry inwards or of the arrival, as

the case may be of the goods.

29. In the facts of these cases, there is no dispute

that the imported goods were very much in the Customs

Station and the Bills of Entry were presented under

Section 46(1) on 16.2.2019. It is clear that the rate

of duty, for the purpose of the cases before the

Court, is to be determined with reference to the

presentation of the Bills of Entry. The law does not

take into consideration even the time of payment of

the duty which is self-assessed by the importer. This

is noted for the reason that the importer, who

presents a Bill of Entry under Section 46 and who

carries out self-assessment, is duty-bound to pay

such duty on the very same date. The consequence of

failure is only the liability to pay interest under

Section 47 besides disabling him from clearing the

goods. It does not postpone the point of time at

which the rate of duty is to be determined.

30. Having dwelt upon the Scheme of the Act in regard

to goods which are imported into India and which have

33
been entered under a Bill of India for home

consumption, the time is now ripe for ascertaining

the impact of the Notification which came to be

issued late in the evening on 16.02.2019. The nature

of the Notification, which is admittedly issued under

Section 8A of the Tariff Act, has been explained

earlier. It is a species of delegated legislation. As

far as law made by Parliament or the State

Legislatures, which are sovereign bodies in their own

right, subject, no doubt, to their position, under

the Constitution, as expounded by this Court, the law

comes into force immediately after the assent is

given by the President or the Governor, respectively.

A law made by Parliament has effect without any

further act on the part of the Executive. This is, no

doubt, subject to the intention expressed otherwise

in the law so made as to any other date from which it

is to have operation. It may also be a case of a

conditional legislation where the law is to be

brought into force by the Executive.

31. No doubt, there is a distinction between

conditional legislation and delegated legislation

34
(See in this regard, judgment of this court in I.T.C.

Bhadrachalam Paperboards and another v. Mandal

Revenue Officer and others40, where the earlier case

law has been exhaustively dealt with).

32. A Notification, which is made by the Executive,

must indeed be made known. Ordinarily this is made

known by being published in the Gazette. In this

regard, it is profitable to refer to what this Court

laid down in the decision reported in B.K. Srinivasan

v. State of Karnataka41:

“15. … It is, therefore, necessary that
subordinate legislation, in order to
take effect, must be published or
promulgated in some suitable manner,
whether such publication or
promulgation is prescribed by the
parent statute or not. It will then
take effect from the date of such
publication or promulgation. Where the
parent statute prescribes the mode of
publication or promulgation that mode
must be followed. Where the parent
statute is silent, but the subordinate
legislation itself prescribes the
manner of publication, such a mode of
publication may be sufficient, if
reasonable. If the subordinate
legislation does not prescribe the mode
of publication or if the subordinate
legislation prescribes a plainly
40 (1996) 6 SCC 634
41 (1987) 1 SCC 658.

35

unreasonable mode of publication, it
will take effect only when it is
published through the customarily
recognised official channel, namely,
the Official Gazette or some other
reasonable mode of publication. There
may be subordinate legislation which is
concerned with a few individuals or is
confined to small local areas. In such
cases publication or promulgation by
other means may be sufficient [Narayana
Reddy v. State of A.P
., (1969) 1 Andh
WR 77].”

33. This view came to be endorsed in a case under the

Customs Act, which is reported in M/s. Pankaj Jain

Agencies v. Union of India and others42. Therefore, 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.

34. While on publication required in law, to make a

Notification effective, the decision of this Court,

rendered under the Central Excise Act in Collector of

Central Excise v. New Tobacco Company and others43, is

noticed. The question, which was considered, was

whether a Notification under the Central Excise Act
42 (1994) 5 SCC 198
43 (1998)144 CTR(SC) 618

36
became effective from the date on which it was

printed in the Government Gazette or from the date it

was made available to the public. This Court,

elaborately referred to the judgment of the Madras

High Court in Asia Tobacco Company Limited v. Union

of India and others44. Therein, the High Court, inter

alia, held as follows:

“8. …… “The mere printing of the
official Gazette containing the
relevant notification and without
making the same available for
circulation and putting it on sale
to the public will not amount to the
notification within the meaning of
r. 8(1) of the Rules. ……………………… It
would be a mockery of the rule to
state that it would suffice the
purpose of the notification if the
notification is merely printed in
the Official Gazette, without making
the same available for circulation
to the public or putting it on sale
to the public …… Neither the
date of the notification nor the
date of printing, nor the date of
Gazette counts for notification
within the meaning of the rule, but
only the date when the public gets
notified in the sense, the concerned
Gazette is made available to the
44 (1985)155 ITR 568 (Mad)

37
public. The date of release of the
publication is the decisive date to
make the notification effective.
Printing of the official Gazette and
stacking them without releasing to
the public would not amount to
notification at all ……”

35. Thereafter, this Court went on to hold as

follows:

“11. We hold that a Central Excise
Notification can be said to have been
published, except when it is provided
otherwise, when it is so issued as to make
it known to the public. It would be a
proper publication if it is published in
such a manner that persons can, if they
are so interested, acquaint themselves
with its contents. If publication is
through a Gazette then mere printing of it
in the Gazette would not be enough. Unless
the Gazette containing the notification is
made available to the public, the
notification cannot be said to have been
duly published.”

36. It may be noticed that a Bench of three learned

Judges came to, however, overrule the Judgment in New

Tobacco Company (supra) in the decision reported in

Union of India and others v. Ganesh Das Bhojraj45.

Therein a Notification was issued under Section 25 of

the Customs Act on 04.02.1987, amending an earlier
45 2000 (9) SCC 461

38
Notification of the year 1976 by which exemption had

been granted and limiting the exemption to the duty

in excess of 25 per cent. The Bill of Entry was filed

on 05.02.1987. This Court took the view that under

Section 25 of the Customs Act, since the Notification

dated 04.02.1987 has been published in the Gazette,

it had come into force and constituted the rates

prevalent on 05.02.1987, when the respondent had

filed the Bill of Entry. In fact, the Court noticed

the subsequent development in Section 25 of the

Customs Act by which sub-Sections (4) and (5) were

added to Section 25, which reads as follows:

“25. Power to grant exemption from duty.—

xxx xxx xxx xxx

(4) Every notification issued under sub-
section (1) or sub-section (2A) shall, —

(a) unless otherwise provided, come
into force on the date of its issue
by the Central Government for
publication in the Official Gazette;

(b) also be published and offered for
sale on the date of its issue by the
Directorate of Publicity and Public
Relations of the Board, New Delhi.

39

(5) Notwithstanding anything contained in
sub-section (4), where a notification
comes into force on a date later than the
date of its issue, the same shall be
published and offered for sale by the said
Directorate of Publicity and Public
Relations on a date on or before the date
on which the said notification comes into
force.”

The view in New Tobacco Company (supra) was held

to be not good law.

37. It is to be noticed that it is in regard to a

Notification issued under Section 25 of the Customs

Act that the principles contained in sub-Section (4)

and (5) will have effect from the date on which these

provisions were brought into force. As far a

Notification issued under Section 8A, with which this

Court is concerned, it is the principle which has

been laid down in Ganesh Das Bhojraj(supra), which

will apply.

38. In other words, as far as the Notification issued

under Section 8A of the Tariff Act is concerned, the

Notification would come into force on the date on

40
which it is published in the Gazette. The question,

however, which arises in this case is, as far as this

Court is concerned, res integra, viz., whether having

regard to the time at which it was published, whether

Notification would come into force on 16.02.2019, by

including the whole of the day or will it operate

from the time of its publication, or whether the

Notification is to be enforced only after excluding

16.02.2019.

39. The question would pointedly arise whether it

was to have effect for the whole of the day, viz.,

16.02.2019, which means, since the day 16.02.2019 was

born, immediately after the midnight on 15.02.2019,

does a day mean the first moment after the midnight?

If that were the effect, what would be its impact on

the Bills of Entry which were electronically

presented under Section 46(1) of the Customs Act read

with Rule 4(2) of the 2018 Regulations, which have

already been referred to above. It is here that it

becomes necessary to notice the provisions of Section

9 of the General Clauses Act, 1897.

41
SECTION 9 OF THE GENERAL CLAUSES ACT, 1897

40. Section 9 of The General Clauses Act, 1897, reads

as follows:

“9 Commencement and termination of time.

(1) In any Central Act or Regulation made
after the commencement of this Act, it
shall be sufficient, for the purpose of
excluding the first in a series of days or
any other period of time, to use the word
from, and, for the purpose of including
the last in a series of days or any other
period of time, to use the word to.

(2) This section applies also to all
Central Acts made after the third day of
January, 1868, and to all Regulations made
on or after the fourteenth day of January,
1887.”

41. In this case, there is no dispute that

Notification under Section 8A was published in the

Gazette. It was published at 20:46:58 hrs. on

16.02.2019. It is to be noticed that we are not

dealing with a case, where a period of time, limited

by two different termini, is present. A Statute may

fix a terminus aquo. The Statute may be made to last
42
without indicating when the period is to end, which

is the terminus ad quem.

42. Section 9 of the General Clauses Act enunciates

the principle, that for, excluding the first in a

series of days or any other period of time, it

suffices to use the word “from”. It also provides,

likewise, for the devise of using the word “to”, for

the purpose of including the last in the series of

days or other period of time. It is clear from

Section 9 that it contemplates a period, or a series

of days which is marked by both terminus aquo and

terminus ad quem. Section 9 is expressly intended to

apply to a Central Act or Regulation.

43. In this case, we are concerned with the

Notification issued under the Statute, and which is a

piece of delegated legislation, under which, the rate

of import duty has been increased. The increase in

the rate of duty is not for any period. In other

words, it is not a case where the terminus ad quem or

a period of time, is fixed for the operation of the

increased import duty of goods imported from

43
Pakistan. In other words, the increased rate of

import duty under the Notification is to last

indefinitely. The word “indefinite” is intended to

mean that it is to bear life till it is increased,

reduced or completely done away with, in exercise of

powers available under the Customs Act or the Customs

Tariff Act (See in this regard Section 25 of the

Customs Act and Section 2 of the Tariff Act).

A DAY; A PERIOD OF TIME; FRACTION OF TIME

44. It now becomes necessary to refer to principles

enunciated by Courts in diverse situations under

different branches of law.

45. I would begin by referring to an off-quoted

Judgment rendered by the Master of the Rolls, Sir

William Grant in the decision reported in Lester v.

Garland46. In the said case, there was a bequest of

residual interest in favour of ‘A’ if she gave

security not to marry ‘B’, inter alia, within six

calendar months, after the death of the Testator.

46 [1808] 15 Ves. 248

44
There was a proviso to go over if ‘A’ refused to give

such security. The Testator died on the 12th of

January. Security was given by ‘A’ on the 12th of

July. The Testator died on 12th of January between 8

and 9 in the evening. Security was given by ‘A’ about

9 in the evening on 12th of July. The question, which

was considered was whether the date of the death of

the Testator was to be included within the six

months, within which, ‘A’ had to give the security,

or to be excluded. If the day of the death of the

Testator was included, the security given by ‘A’

would be beyond the period of six months and she

would stand divested of the bequest, whereas, if the

date of the death of the Testator was excluded, then,

‘A’ would be entitled to the bequest as the security

given by her would be within the period of six

months. It would be profitable to notice the relevant

part of the discussion by the learned Judge:

“It is not necessary to lay down any
general rule upon this subject: but upon
technical reasoning I rather think, it
would be more easy to maintain, that the
day of an act done, or an event happening,
ought in all cases to be excluded, than
that it should in all cases be included.

45

Our law rejects fractions of a day more
generally than the civil law does. (See
the note, 14 Ves. 554, where it is
admitted in bankrupty.) The effect is to
render the day a sort of indivisible
point; so that any act, done in the
compass of it, is no more referrible to
any one, than to any other, portion of it;
but the act and the day are co-extensive;
and therefore the act cannot properly be
said to be passed, until the day is
passed. This reasoning was adopted by
Lord Rosslyn and Lord Thurlow in the case
before mentioned of Mercer v. Ogilvie. The
ground, on which the judgment of the Court
of Session was affirmed by the House of
Lords, is correctly stated in the fourth
volume of the Dictionary of the Decisions
of the Court of Session. In the present
case the technical rule forbids us to
consider the hour of the testator’s death
at the time of his death; for that would
be making a fraction of a day. The day of
the death must therefore be the time of
the death; and that time must be past,
before the six months can begin to run.
The rule, contended for on behalf of the
Plaintiffs, has the effect of throwing
back the event into a day, upon which it
did not happen; considering the testator
as dead upon the 11th, instead of the
12th, of January ; for it is said, the
whole of the 12th is to be computed as one
of the days subsequent to his death. There
seems to be no alternative but either to
take, the actual instant, or the entire
day, as the time of his death; and not to
begin the computation from the preceding
day.

But it is not necessary to lay down any
general rule. Whichever way it should be
laid down, cases would occur, the reason
of which would require exceptions to be
46
made. Here the reason of the thing
requires the exclusion of the day from the
period of six months, given to
Mrs. Pointer to deliberate upon the choice
she would make; and upon the whole my
opinion is, that she has entered into the
security before the expiration of the six
months; in sufficient time therefore to
fulfil the condition, on which her
children were to take.”

(Emphasis supplied)

46. In Re. Railways Sleepers Supply Co.47, an

Extraordinary General Meeting of the company passed a

Special Resolution on 25.02.1885, for the reduction

of the capital of the company. On 11.03.1885, the

Resolution passed on the 25.02.1885, was confirmed.

On a petition filed, seeking sanction of the Court

for the proposed reduction of capital, the question

arose whether there was compliance with Section 51 of

the Companies Act, 1862. The said provision, inter

alia, required confirmation of the Resolution at a

subsequent General Body Meeting which was held at an

interval of not less that fourteen days and not more

than one month from the date of the meeting at which

the Resolution was first passed.

47 (1885) 29 Ch.d. 204

47

47. Chitty J., in his opinion, referred to Lester v.

Garland (supra) and held, inter alia, as follows:

“… Lord Mansfield in his well-known
judgment in Pugh v. Duke of Leeds says, “Date
does not mean the hour or the minute, but the
day of delivery, and in law there is no
fraction of a day.” The day of the death of
the testator, which is equivalent here to the
day of the first meeting, was not reckoned by
Sir William Grant in his well-known decision
in Lester v. Garland, where a bond had to be
given within six months after the testator’s
decease. The 51st section states that the
subsequent or second meeting is to be held
“at an interval of not less than fourteen
days or more than a month.” The word “at”
means after the interval, or at some time
after the interval, prescribed by the other
part of the section. The word “at” refers
grammatically rather to a point of time than
a period. ……”

“… The interval “of not less than
fourteen days” was allowed to give reasonable
time for deliberation, and to prevent undue
haste or surprise, and to afford to the
shareholders who might be present at the
first meeting, and also to those who might
not think fit or might not be able to attend
it, time for reflection and consideration,
and to make arrangements to enable them to
attend the second….”

“…. An interval of not less than
fourteen days” is equivalent to saying that
fourteen days must intervene or elapse
between the two dates….”

“… That means fourteen clear days; and
as Littledale , J., said in Reg. v. Justices
of Shropshire, I do not see any distinction

48
between “fourteen days” and “at least
fourteen days.” I must come therefore to the
conclusion that the resolution is bad.
Probably no question has more exercised the
minds of Judges in former times than the
question as to the proper mode of computing
time. Lord Mansfield’s judgment in Pugh v.
Duke of Leeds and Lord Wensleydale’s judgment
in the case of Chambers v. Smith, to which I
have already referred, are excellent
illustrations of what I have said. ….”

48. In 1895, a case, viz., In Re. North48 arose under

the Bankruptcy Act, 1890. The question was whether an

act of bankruptcy had been committed by reason of the

fact that on an action taken by an execution

creditor, and after the seizure of goods of the

debtor and subsequent private sale, as permitted by

the Court, the Sheriff had held the goods for a

period of twenty-one days. Lord Esher M.R., after

referring to Lester v. Garland (supra), holds as

follows:

“ …., after a learned examination of the
whole subject, laid down what I conceive
to be the wholesome view that no general
rule exists. ….”

48 (1895) 2 Q.B. 264

49
“… The statute which we have to construe
for the purpose of deciding how the period
of time mentioned in it is to be computed
is a Bankruptcy Act, and enacts a new act
of bankruptcy, the commission of which is
to be determined by a computation of time.

….”

“… If we construe s. 1 of the Act of 1890
according to the ordinary English meaning
of the words, it enacts that certain
consequences are to happen if the sheriff
holds for twenty-one days goods seized by
him under an execution: an act of
bankruptcy is committed if he holds them
for that time. The ordinary meaning of the
words is that he must hold them for
twenty-one days; but we are told that
under a technical rule of construction the
section is satisfied if he holds them for
twenty days and a part of a day. Which is
right? …”

“… Here the result may be to make a man a
bankrupt, which is not a benefit to him,
nor necessarily to the whole of his
creditors. The bankruptcy law is a law of
public social policy, and affects in a
very detrimental manner the status of
those who are brought under its operation;
in old times, indeed, to make a man a
bankrupt was to make him a criminal; …”

“… Bankruptcy is the creature of statute,
and under a long series of bankruptcy
statutes the same practice as to computing
time has been followed, though for
different purposes or results; the
practice is a perfectly well-known one,
the rule in bankruptcy being to exclude
the first day or part of a day, and to
begin the computation of time on the first
whole day. …”

50
“… Again, there is the rule of
construction that if a statute, which so
affects a man’s status as to be in effect
a penal enactment, is capable of two
constructions, that one should be adopted
which is most favourable to the person
affected. Applying this rule, the mode of
calculating the twenty-one days ought to
be in favour of the debtor doing something
which would prevent his becoming a
bankrupt at all, and we ought to construe
this section as meaning that the first
day, or part of a day, is to be excluded
from the computation, which should begin
on the day after the date of the seizure.
…”

(Emphasis supplied)

49. A.L. Smith L.J. agreed with Lord Esher M.R. and

held, inter alia, as follows:

“… But it has been shewn from subsequent
cases that there is no such universal
rule, and that in the reckoning of time
each case must depend on its own
circumstances and subject-matter, and for
this I need only refer to the judgment of
Sir William Grant in Lester v. Garland ,
to that of Kelly C.B. in Isaacs v. Royal
Insurance Co., and of Chitty J. in In re
Railway Sleepers Supply Co. To say,
therefore, that a rule of law compels us
to say that to hold goods for twenty days
and a fraction of a day is the same as to
hold them for twenty-one days is to say
that which is not a fact. …”

51

50. Rigby L.J. also concurred with Lord Esher M.R.

and, in his judgment, held as follows, inter alia:

“… It was contended before us, and it
seems at one time to have been thought to
be law, that where a fact or event was
mentioned from which a given period of
time was to be reckoned, the Court was
bound to reckon the portion of the day on
which the act was done as though it were a
whole day, and to reckon it as the first
day of the period. That doctrine underwent
a thorough examination in Lester v.
Garland, at the hands of Sir W. Grant, who
considered the cases in which the first
day had been included or excluded, and
came to the conclusion (which I think was
inevitable) that there was no general rule
on the subject. …”

“… His classification of the cases shews
that where the calculation is in favour of
a person, the construction should be
adopted which is more favourable to him.
In the case of a sheriff, for instance, it
is more in his favour to include the day
on which the act is done than to exclude
it, and on that ground it is included; but
where, to take another example, something
has to be done which is necessary to
complete a title, the first day is
excluded, otherwise there would be a
cutting down of the time allowed for doing
the act. In my opinion, although Sir W.

Grant did not put the proposition in so
many words, his judgment leads us to the
conclusion that the question of whether
the day on which the act is done is to be
included or excluded must depend on
whether it is to the benefit or
disadvantage of the person primarily
interested. But whether or no the

52
proposition is to be put so high, we have
here a statute which does not say twenty-
one days from taking possession; and it is
only to cases where a terminus is
mentioned that any such general rule was
ever held to apply. The present is an a
fortiori case; no terminus is mentioned,
and the only question is whether the
sheriff held for twenty-one days. …”

(Emphasis supplied)

51. On 05.05.1922, by a Notification in the Fort

St. George Gazette Extraordinary, published on a

Friday, the Table of Fees under Appendix-II, the old

Rules on the Original Side of the Madras High Court,

was amended and instead of a fixed fee of Rs.30/-

levied under Serial No.1, it was provided that

Rs.150/- was to be levied in all the suits where the

value of the subject matter does not exceed

Rs.10,000/-, inter alia. The Notification further

recited that the amendments were to come into force

from the date of publication in the Fort St. George

Gazette. The Gazette Extraordinary reached the High

Court at about 05.00 p.m. on 05.05.1922. A Special

Bench was constituted to resolve the controversy as

to whether the amended Scale of Fees was to apply

53
from the 5th day of May or after excluding the 5 th May.

The three learned Judges, In Re: Court Fees49

proceeded to author three separate Judgments. The

majority view is contained in the judgments of the

Chief Justice and Justice V.M. Coutts Trotter. In

their Judgments, they took the view that the amended

Scale of Fees, though as already noted, represented

an increase from an earlier Scale of Fees, was to

apply even in regard to the suits which came to be

instituted before the time of the Notification on

05.05.1922. In the Judgment of the learned Chief

Justice, the following discussion is noted:

“2. … I approach this matter
conscious of the salutary rule that, in
all statutes imposing taxation, any real
ambiguity must be decided in favour of the
subject and against the Grown. I consider
that the hour of the day at which the
Gazette was actually published is a wholly
irrelevant consideration, because on
neither view does it make any difference.

If the Gazette had been published early in
the morning, according to the view of
Kumaraswami Sastri, J., the tax will come
into operation only the next day. If it
had been published late in the night,
according to the view of Coutts-Trotter,
J., the tax would still be operative from
49 AIR 1924 Madras 257

54
the time the office opened for the receipt
of plaints on that day. I agree that we
have nothing to do with the English Common
Law except in so far as it may afford some
guide as to the proper meaning to be
attached to words in the English language.
… .

3. … Applying the general rules stated
above to this case, the named date must be
included unless there is some valid reason
why it should not be, and I can find none.
It is true that it may have the effect of
making persons pay more than they
understood they had to pay when they filed
their suits; but this seems to me a ground
for criticising the method of imposing
this tax rather than a ground for
interpreting the notice in any particular
way; and I think that this argument is
more than counterbalanced by the fact that
this was a sudden imposition of a tax
which in many cases could be avoided if
notice was given of it in time for suits
to be filed between the time of the
publication and of its actually coming
into operation. …”

(Emphasis supplied)

52. In the Judgment of V.M. Coutts Trotter J., the

learned Judge observes as follows:

“6. … What I conceive to emerge
from the decided cases is this: that as
the law in general neglects fractions of a
day you must either exclude or include the
whole of the day with which a given
statute or rule or regulation deals. And
the exclusion or inclusion, I think, is

55
clearly provided in two other rules. If
you are fixing the point of time at which
a certain state of things is to be called
into existence, that state of things comes
into existence at midnight of the day
preceding the day at which or on which or
from which or from and after which the new
state of things begins. In such cases the
statute or rule is only concerned in
fixing the terminus o quo of a new state
of law which is enacted to continue
indefinitely, in other words, until
repealed by a new enactment of the
legislature where, in short, you have a
terminus a quo but no terminus ad quem.
………………………………

…… Where a statute fixes only the terminus
a quo of a state of things which is
envisaged as to last indefinitely, the
common law rule obtains that you ought to
neglect fractions of a day and the statute
or regulation or order takes effect from
the first moment of the day on which it is
enacted or passed, that is to say, from
midnight of the day preceding the day on
which it is promulgated: where, on the
other hand, a statute delimits a period
marked both by a terminus a quo and a
terminus ad quem, the former is to be
excluded and the latter to be included in
the reckoning. This notification clearly
falls within the former class and must be
taken to have come into force on the first
second of the 5th May, that is to say,
from midnight of the 4th May. It follows
that the plaints filed on the 5th May are
liable to the enhanced fees laid down by
the Regulation.

7. A very large part of the argument
addressed to us on behalf of those who
filed plaints on the 5th May was based on
what was called a hardship suffered by

56
them if our decision should be favourable
to the Crown. Increased taxation is always
in a sense a hardship to the subject but I
cannot see any special hardship imposed
upon these particular litigants. If the
suits which they filed are not in their
opinion worth the expenditure entailed by
the increased rate of institution fees,
they would doubtless be permitted to ?
withdraw them-a suit evaluated at that
rate by the person who institutes it, is
not likely to be based on a very solid
cause of action. ….”

(Emphasis supplied)

53. However, C.V. Kumaraswami Sastri, J., dissented.

The learned Judge also referred to Lester v. Garland

(supra) and In Re. North (supra) and held as follows:

“21. Applying the law as laid down in
the previous cases to the facts of the
present case, we have to see whether the
5th of May, 1922, is to be included or
excluded. I might, in this connection,
state that I do not think that the
principles which govern, or the devices
which are resorted to, by the Executive
for the purpose of raising money by
taxation ought to have any weight with us
in determining whether the date of
publication is to be included or excluded.
I do not think the High Court is part of
the tax gathering machinery of the
Government or has any concern with the
consequences to the Government of their
decision on the construction of the rule.

57

The rule, I take it, was passed by the
Judges of the High Court in the exercise
of the powers entrusted to them to control
the administration of justice and the fees
were raised because in the opinion of the
Judges it was just and proper that
litigants ought to pay more for the
benefits which they derive by resorting to
the jurisdiction of the High Court. The
notification expressly states that it is
to have effect from the date of
publication, the object of the publication
being that the public ought to have notice
that the fees were being raised so that
they might know exactly what they were in
for when they resorted to the High Court
for justice. The notification, as I have
already said, was (as appears from a note
of the Deputy Registrar) received in the
High Court at 5 p.m., the office closing
at 5 p.m. It seems to me that the
litigants who filed plaints before they or
even the office had knowledge of the
publication of the rule did what was
perfectly valid under the old rules and
they presented the plaints with Rs. 30
stamp irrespective of the value of their
claim. A person who files a plaint which
is properly stamped and which is in order
at the time of presentation is entitled to
have his plaint admitted on presentation
though as a matter of convenience the
office receives the plaints and admits
them at the end of the day or later on.
There seems to me to be very little
justice or equity in directing that
persons who have done what was perfectly a
legal and valid act at the time should pay
a Court-fee which is much higher simply
because a notification was received at the
close of the day making the higher fees
chargeable from the date of the
notification. It may well be that if those
persons had notice that instead of Rs. 30
58
they had to pay at least Ra. 150 and a
maximum that would range according to the
value of their claim, they might rather
have compromised with the other side or
might have had resort to other proceedings
like arbitration for settling their
claims. I can find nothing to justify
charging people, who filed their plaints
on that day without knowledge of the
notification which only reached the High
Court at 5 p.m., with the higher fees in
respect of plaints filed during the course
of the day.

22. Having regard to all the facts
and circumstances of the present case, I
think that, if the law is that there is no
hard and fast rule in deciding whether the
word “from” is inclusive or exclusive of
the date of notification and that each
case must depend upon its own
circumstances subject-matter, justice and
equity demand that the date of the
notification ought to be excluded. I
would, therefore direct that all the
plaints received on the 5th of May, 1922,
be stamped with Rs. 30.”

(Emphasis supplied)

THE POSITION UNDER THE LAW RELATING TO
PREVENTIVE DETENTION

54. A Division Bench of High Court of Delhi had

occasion to consider the question again of time of

operation in the following circumstances in the

decision reported in Jasbir Singh vs. Union of

59
India50
. The contentions urged by the detenu included

the contention that the detention orders stood

vitiated as in contravention of Section 3(3) of the

COFEPOSA Act, the grounds of detention was served on

the 6th day of the day of Order of detention being

served. Section 3(3), inter alia, provides for

communication to a person of the grounds of detention

as soon as may be after detention but ordinarily not

later than five days and in an exceptional case and

for reasons to be recorded in writing not later than

15 days from the date of detention. The Division

Bench, which included Chief Justice M. Jagannadha Rao

(as His Lordship then was), took note of judgment of

the Madras High Court reported in In Re: Court Fees51

under the Court Fee Act and took the view that the

word “from” is similar to the word “after”, and

therefore, the date on which the detention order was

served, has to be excluded. In this regard, the

Court took the view that the legislature has given

clear 5 days to the Government to complete many other

formalities before serving the grounds of detention.

50 (1995) ILR 2 Delhi 399
51 AIR 1924 Madras 257

60
This is besides being guided by the use of words ‘as

soon as may be’.

THE CASES UNDER CONTRACTS OF INSURANCE

55. In the decision reported in New India Assurance

Company Limited vs. Ram Dayal and Others 52, the

vehicle was insured earlier upto 31st August, 1984.

Instead of obtaining renewal, a fresh insurance was

taken from 28th September, 1984. The accident took

place on the very same day, namely, 28th September,

1984. The insurer repudiated its liability as the

policy was taken after the accident. The High Court

took the view that the policy of insurance became

operative from the commencement of the date of

insurance, namely, the previous midnight. This Court

agreed with the view of the High Court that once a

policy is taken on a particular day, its

effectiveness is from the commencement of the day.

It found the insurer liable. It is necessary only to

notice paragraphs 5, 6 and 7:

“5. As pointed out in Stroud’s judicial
Dictionary ‘Date’ means day, so that

52 (1990) 2 SCC 680

61
where a cover not providing for
temporary insurance of a motor car
expires 15 days after date of
commencement, it runs for the full 15
days after the day on which it was to
commence.”

6. Similarly it has been stated in
Stroud that “a bill of exchange, or
note, is of the date expressed on its
face, not the time when it is actually
issued.”

56. The view taken by this Court in regard to the

issue of the liability of insurer with reference to

the time at which the policy of insurance is taken,

may be noticed from the recent judgment which

adverted to, not only Ram Dayal (supra) but the

Judgment rendered by three-Judge Bench, reported in

Oriental Insurance Company Limited v. Porselvi and

Another53 and another judgment reported in Oriental

Insurance Company Limited v. Sunita Rathi and

Others54. The recent judgment is reported in National

Insurance Company Limited vs. Geeta Devi and Others 55,

I may refer to paragraphs 3 and 4 which adverts to

the decisions of this Court distinguishing Ram Dayal

53 1997 (1) SCC 66
54 1998(1) SCC 365
55 2010(15) SCC 670

62
(supra). Finally, this Court took the view, there is

a cover note mentioning the time as 04:40 p.m. and it

was issued after the accident and therefore, the

insurer was not liable:

“3. The question again came up for
consideration in National Insurance Co.
Ltd. v. Jikubhai Nathuji Dabhi
; (1997) 1
SCC 66. Reliance was placed on the
abovementioned judgments. However, a
three-Judge Bench of this Court noted
that the Tribunal had recorded, as a
fact, that the policy had come into
force at 4:00 P.M. whereas the accident
had taken place at 11:40 a.m. This
Court held that in view of the special
contract and in view of the fact that
the accident had occurred earlier, the
insurance coverage would not enable the
claimant to seek recovery from the
Insurance Company.

4. The question again arose in Oriental
Insurance Co. Ltd. v. Sunita Rathi
;
(1998) 1 SCC 365, was relied upon. This
court distinguished Ram Dayal case;
(1990) 2 SCC 680, was relied upon. This
Court distinguished effective date and
time of the policy was after the
accident, the Insurance Company would
not be liable.”

57. After having made a reference to some of the

decisions covering different branches of law, the

63
question to be resolved comes into focus. It is

clear that the situation which is presented before

us, is not covered by the principle which is embedded

in Section 9 of General Clauses Act, 1897. In other

words, having regard to the terms of the

Notification, which is a form of delegated

legislation, by which the Central Government has

increased the rate of import duties of goods imported

from Pakistan, though the notification is gazetted on

16.02.2018 at 20:46:58 hrs., there is no period for

which it is to last as already noticed, and in that

sense, it can be argued that there would be no

occasion for exclusion of the date on which it was

issued.

WHETHER SECTION 5(3) OF THE GENERAL CLAUSES ACT
APPLIES TO THE NOTIFICATION?

58. Section 5 (3) reads as follows:

“5(3) Unless the contrary is expressed,
a Central Act or Regulation shall be
construed as coming into operation
immediately on the expiration of the day
preceding its commencement.”

64

59. The argument of learned Additional Solicitor

General is that in terms of Section 5 (3), the

notification issued under the Customs Tariff Act will

have effect from the expiry of the previous day.

That is to say, it will operate from the first tick

of time past the mid night of 15.2.2019. In order to

appreciate this argument, we must consider definition

of the word ‘Central Act’ and ‘Regulation’ in the

General Clauses Act. Section 3 (7) defines Central

Act. It reads as follows:

“(7) “Central Act” shall means an Act of
Parliament and shall include-

(a) an Act of the Dominion legislature or
of the Indian Legislature passed before
the commencement of the Constitution, and

(b) an Act made before such commencement
by the Governor General in Council or the
Governor General, acting in a legislative
capacity;”

60. Section 3 (50) defines ‘Regulation’. It reads as

follows:

“3(50) “Regulation” shall mean a
Regulation made by the President under
article 240 of the Constitution and
shall include a Regulation made by the
President under article 243 thereof and
a Regulation made by the Central
Government under the Government of India
65
Act, 1870, or the Government of India
Act, 1915, or the Government of India
Act, 1935”

61. It is quite clear that the notification which is

issued is one which is issued under Section 8A of the

Tariff Act. The notification is not one which is

made by Central Legislature, namely, the Parliament.

It therefore is not a Central Law as defined in the

Act. We have also noticed the definition of the word

‘Regulation’. The notification is not a regulation

as defined in General Clauses Act. There is no merit

in the contention of the Union of India 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.

THREE POSSBILE VIEWS

62. There are three possible answers to the questions

as to what is to be the meaning of the word ‘day’, in

the context of the provisions of Section 15 the

Customs Act and the Notification.

66

1.The first way to look at “the day”, would be to

take it as a fraction of day, viz., 16.02.2019,

having its beginning at 20:46:58 hrs. and ending

with the midnight on 16.02.2019.

2.The second way to look at it is, it would

operate only after the midnight of 16.02.2019,

and would impact Bills of Entries presented on

17.02.2019 onwards. In other words, it would be

an interpretation which would exclude 16th

February, 2019.

3.The third day to look at it would be as follows

– “16.02.2019, would mean the day commencing

immediately after the midnight on 15.02.2019,

and therefore, it would be the whole of the 24

hours commencing at midnight of 15.02.2019 and

would include the period of time during the day

during which the respondents had presented the

bill of entry”.

63. The question is certainly not free from

difficulty. The solution must, however, be found.

67
On one hand, we are dealing with a Notification by

which the appellant has purported to increase the

rate of duty to a hefty quantum of 200 per cent,

following the incident which took place at Pulwama.

Would it be a fair and reasonable to include the

whole, the day 16.02.2019, having regard to the

effect on the importer of the goods who would have

struck the bargain on the basis of rate of duty being

what it was prior to the Notification? Could it not

be said that based on the contracts for import, the

importer would have entered into contracts for sale

of goods in India where the price would be fixed with

reference to the position obtaining as on the date of

contract for import.

64. On the other hand, what we are called upon to

decide, is the question of time at which the

delegated legislation will take effect. It is true

that there is no equity about tax. The fact that

there is a sudden increase in the rate of tax, may

not render it vulnerable on the score that it

violates Fundamental Rights. [See in this regard, the

68
Judgment of this Court in Pankaj Jain vs. UOI

(supra)].

65. If analogy is to be drawn from the majority view

of Madras High Court in the matter relating to Court

Fees (supra), it can, indeed, be urged that the

impact of the increased duty of import cannot by

itself decide the question as to the point of time at

which the delegated legislation must operate from.

66. Yet another aspect which could not be over-looked

is while it is true that in Section 15 of the Customs

Act, what is referred to is the rate of duty enforced

on the date, the law itself entitles importer to

have the goods cleared upon payment of the duty which

is accepted as correct in the self-assessment

proceedings, following the due presentation of the

bill of entry under Section 46 read with Rule 4(2) of

the 2018 Regulations. In conjunction with the mandate

of charging section contained in Section 12 and

Section 15 of the Customs Act which fixes the date

according to the rate of duty as the date of

presentation of the bill of entries, could it

69
certainly not be said that the law would abhor the

reopening of transactions which have culminated in

proceedings which are otherwise impeccably correct

and regular. By way of re-assessment can matters

concluded in the eye of law be revisited on the basis

of a notification which comes much later in the day?

There is yet another aspect which must also be borne

in mind. The question before us, arises on the basis

of notification which is, indeed, a form of delegated

legislation which is issued under Section 8A of the

Tariff Act. Section 8A of the Tariff Act empowers

the Central Government to increase the rate of import

duty but the power to issue a notification under

Section 8A, is not conferred to increase the rate of

import duty with retrospective effect.

67. We may at once notice the counter argument. By

ensuring full play for the notification for the whole

of the day on which it was issued, the provisions of

Section 15 of the Customs Act in the view of

Additional Solicitor General, are duly honoured. It

is his argument that any other view would involve

rewriting of Section 15, as Section 15 contemplates

70
the rate of duty to be the rate of duty for the day.

There cannot be two rates of duty at a given point of

time. If the rate of duty, on a proper

interpretation of the Notification would hold the

field at all points of time during the whole of

16.02.2019 at which the respondents may have

presented the Bills of Entry in tune with the

prevailing rates of duty which would have been

applicable otherwise, it would not detract from the

power of authority to reassess on the strength of an

instrument like the Notification. What would

logically and inexorably follow, in other words, is

that the rate of duty applicable during the whole of

the day on 16.02.2019 was only the increased rate of

duty. This was, therefore, the correct rate of duty

at which the importers were to pay the duty. There

is no illegality involved in resorting to power

enabling reassessment and recovery of the correct

duty from the respondents. In other words, there is

no retrospectivity involved, runs the argument.

68. There can be no doubt that the principle which

appears to have evolved over a period of time is that

71
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, as found hereinbefore.

69. If the contention of the Union of India is

accepted, though the notification is issued late in

the evening, the ‘day’ referred in Section 15 of the

Customs Act would commence from the first moment past

the midnight of 15.02.2019. The diametrically

opposite option would be to exclude the whole of the

day on which the notification was issued and the

third option is that the day would consist of the

hours remaining of the day 16.02.2019 after the time

at which the Notification was issued. In other

words, under the third option, the time of operation

of the notification was 20:46:58 hrs. and continued

till midnight of 16.02.2019. It would indeed

72
constitute a fraction or part of an ordinary day

consisting of twenty-four hours.

70. If the argument of Mr. P.S. Narsimha, learned

Senior Counsel, is accepted, then, it would have

operation from the time at which the Notification is

issued. This is because in answer to a query as to

what would be the position if the Notification had

been issued at 10.00 a.m. on 16.02.2019 and the Bills

of Entry were presented after 10.00 a.m., his

response was, the importers would have to pay the

higher rate of duty under the Notification.

Therefore, his argument appears to be that a

Notification must come into operation with reference

to the point of time of the day when the Notification

was issued.

71. The principle that fractions of the day are

eschewed from consideration, is not a universal

principle which knows no exceptions.

72. Section 48 of the Transfer of Property Act, 1882,

reads as follows:

73
“48. Priority of rights created by
transfer.—Where a person purports to
create by transfer at different times
rights in or over the same immoveable
property, and such rights cannot all exist
or be exercised to their full extent
together, each later created right shall,
in the absence of a special contract or
reservation binding the earlier
transferees, be subject to the rights
previously created.”

73. In an enquiry, as to the priority of title, the

fractions of the day, undoubtedly, will assume

relevance. In fact, the exact time at which a

document is registered, will determine the question

of priority, and consequently, of title itself, to

the property concerned and it is open to parties to

adduce evidence in this regard.

74. Section 47 of the Registration Act, 1908, reads

as follows:

“47. Time from which registered document
operates.—A registered document shall
operate from the time which it would have
commenced to operate if no registration
thereof had been required or made, and not
from the time of its registration.”

74
Here again, the time of the day may become

decisive. The recent decisions of this Court in

regard to insurance contracts appear to accept the

significance of the time of the day. (See para 56 of

this judgment).

75. Section 5(1) of General Clauses Act, 1897 reads

as follows:-

“5. Coming into operation of enactments.—
(1) Where any Central Act is not expressed
to come into operation on a particular
day, then it shall come into operation on
the day on which it receives the assent,—

(a) in the case of a Central Act made
before the commencement of the
Constitution, of the Governor-General, and

(b) in the case of an Act of Parliament,
of the President.”

It must be noticed that 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. In this

75
regard, the words of Bailhache, J. in Johnson v.

Sargant & Sons56; 1917 1 K.B. 101, come to mind:-

“While I agree that the rule is that a
statute takes effect on the earliest
moment of the day on which it is passed
or on which it is declared to come into
operation, there is about statutes a
publicity even before they come into
operation which is absent in the case of
many Orders such as that with which we
are now dealing ; indeed, if certain
Orders are to be effective at all, it is
essential that they should not be known
until they are actually published.”

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. On this rationale even the principle
56 1917 1 K.B. 101

76
embedded in Section 5 in regard to the law made by

the legislature cannot be applied to a notification

issued under Section 8A of the Tariff Act.

76. The view taken by Justice Kumaraswami Sastri, in

Re: Court Fees (supra), in the context of the

increase in the Court Fee, effected under a

Notification, which came to the High Court only at

about 05.00 p.m., which was around the time when

Court closed down, was to exclude the operation of

the increased Court Fee qua the suits which were

filed during the course of the day.

77. At the time, when the Madras High Court

considered the question, it may be noticed that the

Constitution of India was not in force. The matter

has not been approached on an analysis as to the

nature of subordinate legislation and the point of

time when a subordinate legislation comes into force.

The concept of State action, satisfying the

requirement of it being fair, as is the mandate of

Article 14, could not have been possibly considered

by the learned Judges of the Madras High Court. Under

77
the Customs Act read with the Tariff Act, as noticed,

the Scheme provides for an importer, wishing to enter

goods for home consumption, to file Bills of Entry,

do self-assessment and pay the duty on the same day.

If all goes well, which means that the self-

assessment is in accordance with the existing law,

and the rate of tax is calculated with reference to

the rate of duty as stipulated and the amount of duty

is paid, and if there is any other amount to be paid,

the same is also paid, Section 47 of the Act would

oblige the Officer, unless, of course, the goods are

prohibited goods, to issue an Order permitting

clearing the goods. Though, there is no Order for

clearing the goods in these cases under Section 47,

the said Order is the culmination of the steps to be

undergone by an importer for clearing the goods. Once

the self-assessment is correct and the other

conditions in Section 47 do not militate against the

importer, the goods can be physically cleared, and

having regard to the definition of the “imported

goods”, they cease to be imported goods.

78

78. 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 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 re-

assessment. The interpretation based on time of

79
publication is in harmony with a view that accords

respect for vested rights.

TWO INCONSISTENT RATES AT THE SAME POINT OF TIME

79. There is no merit in the submission of the

appellants in this regard. 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 2018 Regulations.

EFFECT OF THE WORD “OTHERWISE” IN SECTION 17(4) OF
THE CUSTOMS ACT, 1962

80. The expression “otherwise” in Section 17(4), will

not come to the rescue of the appellants, in the

facts of the instant case. While the word “otherwise”

may be capable of taking care of situations which are

not covered by the preceding expressions, viz.,

80
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. This is not a case where the

assessment is assailed on any other ground except by

insisting on a rate of duty which is in applicable.

WHETHER THE CASE LAW RELIED UPON BY THE APPELLANTS
MILITATE AGAINST THE AFORESAID VIEW

81. The question which arose before the Constitution

Bench of this court in M/s. Bharat Surfactnts (P)

Ltd. v. Union of India57 may not assist the

appellants. The case involved a

challenge to Section 15(1)(a) of the customs Act.

This court repelled the challenge. More importantly,

that was a case where the vessel in which the goods

were carried belonging to the petitioners arrived on
57 1989 (4) SCC 21

81
11th July 1981. Berth was not available. By reason of

the same it could not discharge its cargo at Bombay.

This court took the view that what is relevant is the

date on which the Bill of Entry is presented.

Therefore, it cannot be treated as authority for the

proposition canvassed by the appellants. The

decision of this Court in Priyanka Overseas (P) Ltd.

v. Union of India58 also will not assist the

appellant in persuading this Court to answer the

question in favour of the appellant. No doubt, the

court has reiterated the principle in Section 15 of

the Customs Act and the question actually fell for

decision under Section 15 (1)(b) of the Act as it

stood prior to its amendment. Section 15 (1)(b) as

it stood then contemplated the rate of duty

applicable in the case of goods cleared from a

warehouse under Section 68 to be rate on the date on

which the goods were actually removed from the

warehouse. Quite apart from the fact that the said

provision has been amended, we are in this case

concerned with Section 15(1)(a) and what is more

58 1991 Suppl.(1) SCC 102

82
important, the actual question is the impact of the

notification issued under Section 8A and what is the

significance of the word “the date”. In the decision

of this Court in Dhiraj Lal H. Vohra v. Union of

India59, the ship arrived at the port on 2.3.1989 and

inward entry was also given on the same day. The

contention taken by the appellant that the ship had

entered the Indian territorial waters on 20.2.1989

and was ready to discharge the cargo was found

irrelevant for purposes of Section 15(1) read with

Sections 46 and 31 of the Customs Act. This decision

also does not assist the Court in deciding the

question which squarely falls for decision. The

decision of this Court in D.C.M.Ltd. and Another V.

Union of India60 involved a challenge to the validity

of Section 15(1)(b) of the Customs Act. Following

the filing of “Bill of Entry for warehousing” on

24.2.1982, the imported goods were warehoused. The

goods were cleared from the warehouse on 3.3.1982 and

15.4.1982. On the basis of Section 15(1)(b) taking

note of the dates of clearance from the warehouse,

59 1993 Supl. (3) SCC 453
60 1995 suppl. (3)SCC 223

83
the duty was levied. The Court noted that Section

12, the charging section was subject to Section 15

among other sections. An option was given to the

importer to either file a Bill of entry for home

consumption straight away in which case he has to pay

the duty based on the filing of the bill of entry.

In the case of bill of entry for warehousing, the

date of clearance of the goods determined the rate

under section 15(1)(b) as it stood. It does not have

any effect qua the facts of the case before this

Court except that what determines the date of the

rate will be found from Section 15 of the Customs

Act.

82. Coming to the decision of this Court in Raj

Kumar Yadav v. Samir Kumar Mahaseth61, the facts of

the case was that an election petition was presented

on 27.8.2003 after the designated judge had retired

to his chamber at 4.15 p.m.. The last date of

limitation was 27.8.2003. The court inter alia held

as follows:

61 2005 (3) SCC 601

84
“6. The limitation provided by Section
81
of the Act expires on the 45th day
from the date of election. The word
“day” is not defined in the Act. It
shall have to be assigned its ordinary
meaning as understood in law. The word
“day” as per English calendar begins at
midnight and covers a period of 24
hours thereafter, in the absence of
there being anything to the contrary in
the context. (See Ramkisan Onkarmal
Agrawal v. State of Maharashtra
[AIR
1994 Bom 87 : 1994 Mah LJ 369] , AIR at
p. 94, Municipal Council of
Cuddalore v. S. Subrahmania Aiyar
[16
MLJ 101 : ILR (1906) 29 Mad 326] and P.
Ramanatha Aiyar, The Law Lexicon, pp.
470, 471.) Thus, the election petition
could have been presented up to the
midnight falling between 27-8-2003 and
28-8-2003.”

This Court also found that the High Court should

not have allowed the period of limitation to be

abridged by the rules. This is besides also finding

that the rules were not properly appreciated. It is

to be noted that question involved was the period of

limitation to file the election petition. The last

day was therefore understood in the manner done. The

decision of this Court in Ahmadsahab Abdul Mulla(2)

(Dead) By Proposed LRs. vs. Bibijan and others62 dealt

with the effect of the use of the expression ’date’

62 2009 (5) SCC 462

85
in Article 54 of the schedule to the Limitation Act,

1963. This Court inter alia held as follows:

“9. According to Advanced Law
Lexicon by P. Ramanatha Aiyar, 3rd
Edn., 2005, the word “date” means as
follows:

“Date.—(As a noun) The point of time at
which a transaction or event takes
place; time given or specified; time in
some way ascertained and fixed; in a
deed, that part of the deed or writing
which expresses the day of the month
and year in which it was made, (2 Bl.

Commn. 304; Tomlin). In Bement &
Dougherty v. Trenton Locomotive, etc.,
Co. [32 NJ Law 513] (NJ Law at p. 515)
it is said: ‘The primary signification
of the word date, is not time in the
abstract, nor time taken absolutely
but, as its derivation plainly
indicates, time given or specified time
in some way ascertained and fixed; this
is the sense in which the word is
commonly used. When we speak of the
date of a deed, we do not mean the time
when it was actually executed but the
time of its execution, as given or
stated in the deed itself.’

‘Where a deed bears no date, or an
impossible date, and in the deed
reference is made to the “date”, that
word must be construed “delivery”; but
if the deed bears a sensible date, the
word “date”, occurring in the deed,
means the day of the date, and not that
of the delivery’ (Elph. 123,
citing Styles v. Wardle [(1825) 4 B & C
908 : 107 ER 1297] ; …).

86
‘Date’, though sometimes used as the
shortened form of ‘day of the date’, is
not its synonym; but means the
particular time on which an instrument
is given, executed, or delivered
(Howard case [2 Salkeld 625: 91 ER 528:

1 Ld Raym 480: 91 ER
1219] ; Armitt v. Breame [(1704) 2 Ld
Raym 1076: 92 ER 213]
and Pewtress v. Annan [(1841) 9 Dowl
828] , Dowl at pp. 834-35). …

‘The word “date” is much more commonly
descriptive of a day than of any
smaller division of time’ (per
Stormonth Darling,
L.O., Simpson v. Marshall [37 Sc LR
316]
Date means day, so that where a cover
note providing for temporary insurance
of a motor car expires ‘15 days after
date of commencement’ it runs for the
full 15 days after the day on which it
was to commence
(Cartwright v. MacCormack [(1963) 1 WLR
18 : (1963) 1 All ER 11 (CA)] ).”

XXX XXX XXX XXX

11. The inevitable conclusion is that
the expression “date fixed for the
performance” is a crystallised notion.
This is clear from the fact that the
second part “time from which period
begins to run” refers to a case where
no such date is fixed. To put it
differently, when date is fixed it
means that there is a definite date
fixed for doing a particular act. Even
in the second part the stress is on
“when the plaintiff has notice that
performance is refused”. Here again,
there is a definite point of time, when

87
the plaintiff notices the refusal. In
that sense both the parts refer to
definite dates. So, there is no
question of finding out an intention
from other circumstances.

12. Whether the date was fixed or not
the plaintiff had notice that
performance is
refused and the date thereof are to be
established with reference to materials
and evidence to be brought on record.
The expression “date” used in Article
54
of the Schedule to the Act
definitely is suggestive of a specified
date in the calendar. We answer the
reference accordingly. The matter shall
now be placed before the Division Bench
for deciding the issue on merits.”

The decision may not assist the appellants in

the nature of the question which falls for decision

in the appeals before this Court.

83. The decision of this Court reported in Pashupati

Nath Singh vs. Harihar Prasad Singh;63 relied upon by

the appellant arose under the Representation of

People Act, 1951. The petitioner therein was a

candidate for the election to the Bihar Legislative

Assembly. He filed his nomination paper on

16.1.1967. His nomination paper was rejected.

Petitioner challenged the election of the returned
63 AIR 1968 SC 1064

88
candidate, on the ground of illegal rejection of his

nomination paper. Section 36 of the Act provides for

scrutiny of nomination paper. The objection taken

which resulted in the nomination of the petitioner

being rejected was that he had not made and

subscribed the requisite oath or affirmation in the

form which is prescribed. Section 36

uses the words ‘the date fixed for scrutiny’ It is

interpreting the said words in Section 36 (2) (a)

that the Court held as follows:

“13. It seems to us that the expression
“on the date fixed for scrutiny” in
Section 36(2)(a) means “on the whole of
the day on which the scrutiny of
nomination has to take place”. In other
words, the qualification must exist
from the earliest moment of the day of
scrutiny. It will be noticed that on
this date the Returning Officer has to
decide the objections and the
objections have to be made by the other
candidates after examining the
nomination papers and in the light of
Section 36(2) of the Act and other
provisions. On the date of the scrutiny
the other candidates should be in a
position to raise all possible
objections before the scrutiny of a
particular nomination paper starts. In
a particular case, an objection may be
taken to the form of the oath; the form
of the oath may have been modified or
the oath may not have been sworn before

89
the person authorised in this behalf by
the Election Commission. It is not
necessary under Article 173 that the
person authorised by the Election
Commission should be the Returning
Officer.

14. In Paynter v. James [(1866-67) LR 2
CP 348] , Bovil, C.J., quoted, with
approval, the passage from the judgment
of Tindal, C.J.,
in Regy v. Humphery [10 Ad & E 335] ,
in which the following occurs:

“… we hold it therefore to be
unnecessary to refer to instances of
the legal meaning of the word ‘upon’
which, in different cases, may
undoubtedly either mean before the act
done to which it relates,
or simultaneously with the act done,
or after the act done, according as
reason and good sense require the
interpretation, with reference to the
context and the subject-matter of the
enactment.”

15. Bovill, C.J., observed that “that
is a very clear statement of the
various meaning of the word ‘on’ or
‘upon’.”

16. In this connection it must also be
borne in mind that law disregards, as
far as possible, fractions of the day.
It would lead to great confusion if it
were held that a candidate would be
entitled to qualify for being chosen to
fill a seat till the very end of the
date fixed for scrutiny of nominations.
If the learned Counsel for the
petitioner is right, the candidate
could ask the Returning Officer to wait
till 11.55p.m. on the date fixed for

90
the scrutiny to enable him to take the
oath.”

Clearly the context and the purpose of the

statute guided the court in holding that the law

disregards fractions and it must be noted that even

then in the said case it was laid down that the

fractions of the day are to be disregarded as far as

possible.

84. The decision of this Court on Vikram Singh alias

Vicky and Another v. Union of India and Others64 is

relied upon to contend that the presumption runs that

the legislature is well aware of the circumstances

and the effect of the words that have been employed

by it. In other words, the contention appears to be

that since the word ‘the date’ is used in Section 15,

it must be given full effect. As far as the judgment

of this Court in The Government of Andhra Pradesh and

Anotheer v. Hindustan Machine Tools Ltd.65 is

concerned, and the purpose for which it is relied

upon, the decision appears to be inapposite in the

facts. The contention taken is that it is competent

64 2015 (9) SCC 502
65 1975 (2) SCC 274

91
for the legislature to make law retrospectively and

as the rate of duty is to be determined as the rate

in force on the day

Section 15 is determinative. It is one thing to say

that the legislature may have the power to make a law

with retrospective effect subject to limitations

imposed by the Constitution and quite another to

contend that delegated legislation would carry

retrospective effect irrespective of power to make

such a law conferred by the parent enactment on the

delegate. More importantly the scheme of the Customs

Act and the Tariff Act and the Regulation 4(2) of the

2018 Regulations rule out the tenability of applying

the notification in the manner sought by the

appellants.

85. Reliance placed on the judgments Video

Electronics Pvt. Ltds and Another vs. State of Punjab

and Another;66, Tamil Nadu Electricity Board and

Another v. Status Spinning Mills Limited and

Another;67 of this Court, taking the view that the

Schedule to an act is a part of the act and therefore
66 1990(3)SCC 87
67 2008(7) SCC 353

92
an amendment to the Schedule by virtue of such a

notification is an amendment to the Act itself and

therefore, the notification issued under Section 8A

of the Tariff Act partakes the character of

legislation, is clearly untenable, if it is intended

to convey that the notification issued under Section

8A of the Tariff Act is made by the legislature

itself. 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. It is to be further noticed

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

93
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 as already

found.

86. In this view of the matter, the Appeals are found

to be without merit and the same will stand

dismissed.

…………………………………J.

[K. M. JOSEPH]

NEW DELHI:

DATED; SEPTEMBER 23, 2020

94



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