Legal principle

Delegated or subordinate legislation can only be prospective and not retrospective unless the statute specifically vests the rule-making authority with power to make it retrospective, and neither Section 3 nor Section 5 of the FTDR Act, 1992 confers any such power on the Central Government.

Court decision

The writ petition was partly allowed. The Court held that the Central Government lacks power or authority under Sections 3 and 5 of the FTDR Act, 1992 to make any order or notification having retrospective effect, so the notification dated 09.09.2021 operates prospectively only. No right accrued or vested in chilli exporters for exports effected between 01.04.2021 and 08.09.2021. Only exporters who effected exports between 09.09.2021 and 24.03.2022 were held eligible to claim incentives, if otherwise eligible; the respondents were directed to process such claims, with liberty to members of the association to file claims within three weeks, and the foreclosure notification dated 25.03.2022 was declared to have no application to claims for exports between 01.04.2021 and 08.09.2021. There was no order as to costs.

Facts

The petitioner, an association of chillies exporters, challenged the DGFT order dated 19.03.2024 rejecting its representation and the Government of India notification dated 25.03.2022, which foreclosed the Revised Transport and Marketing Assistance (TMA) Scheme for Specified Agricultural Products by withdrawing the notification dated 09.09.2021. The TMA Scheme, introduced via notifications dated 27.02.2019 and 29.03.2019, provided export incentives for specified agricultural products for exports from 01.03.2019 to 31.03.2020, and was extended to 31.03.2021 by notification dated 17.03.2020. A revised Scheme notified on 09.09.2021 was made applicable retrospectively from 01.04.2021 to 31.03.2022. The foreclosure notification dated 25.03.2022 withdrew it, stating the Government intended to revamp, redesign and refocus the Scheme for better outcomes. An earlier writ petition (W.P.(C) 15279/2023) had been treated as a representation by this Court's order dated 28.11.2023, which the DGFT rejected on 19.03.2024 as devoid of merit.

Key provisions

• Section 5, The Foreign Trade (Development and Regulation) Act, 1992 — Foreign Trade Policy.
• Section 3, The Foreign Trade (Development and Regulation) Act, 1992 — Powers to make provisions relating to imports and exports.