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TMI Blog2019 (1) TMI 337X X X X Extracts X X X X X X X X Extracts X X X X ..... henticated an order which relates to the Directorate General of Foreign Trade in accordance with the Authentication Rules. The Authentication Rules do not envisage the authentication of only administrative orders but of all executive orders of the Government of India. The contention that the authentication by the DGFT can be only in respect of administrative orders, is, therefore, not in consonance with the provisions of clause (2) of article 77 of the Constitution. Laying of the notifications before the Parliament - Held that:- On a plain reading of sub-section (3) of section 19 of the Act, it is evident that the requirement as to the laying of the order before both Houses of Parliament is not a condition precedent but subsequent to the making of the order. In other words, there is no prohibition to the making of the orders without the approval of both Houses of Parliament. Apart from a bare assertion, there is nothing to show that the provisions of sub-section (3) of section 19 of the Act have not been satisfied, even otherwise, the contention based upon non-compliance with the provisions of sub-section (3) of section 19 of the Act deserves to be rejected. The challen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... column five thereof, which under the existing policy was free, came to be restricted under the revised import policy. Because of the sudden change in the policy decision by the Government, many traders whose businesses are based upon the import of agricultural items in view of the huge demand of such items in India, have been affected. It is the case of the petitioners that production of the agricultural items for which the petitioners have entered into contracts with the overseas companies in India is not sufficient to meet with the demand of the consumers in India and, therefore, traders like the petitioners have to purchase such goods from overseas suppliers. Being seriously affected by the sudden change in the import policy, the petitioners would have to bear huge financial loss and the effect thereof would be to such extent that the staff recruited by the petitioners may also have to suffer, unless the restrictions imposed by the impugned notification are relaxed. 5. It appears that by Notifications No.4/2015-2020 and 5/2015-2020 dated 25.4.2018, the import export policy came to be amended and import of the items mentioned therein, which under the existing policy was free ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Central Government may by Order published in the Official Gazette, direct that any power exercisable by it under the Act (other than the powers under sections 3, 5, 15, 16 and 19) may also be exercised, in such cases and subject to such conditions, by the Director General or such other officer subordinate to the Director General, as may be specified in the Order. It was submitted that, therefore, sub-section (3) of section 6 specifically excludes delegation of power under sections 3, 5, 15, 16 and 19 to the Director General of Foreign Trade. Referring to the impugned notification, it was pointed out that such notification has been issued in exercise of powers under section 3 of the Act read with paragraphs 1.02 and 2.01 of the Foreign Trade Policy and has been issued by the Director General of Foreign Trade. It was submitted that in the light of the provisions of sub-section (3) of section 6 of the Act, the powers under section 3 of the Act cannot be delegated to the Director General of Foreign Trade, and hence, the impugned notification issued by the Director General of Foreign Trade is without any authority as the same is ultra vires the provisions of section 6 of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t known to them which cannot be stated to be bona fide. It was, accordingly, urged that the petitions deserve consideration and interim relief be granted by staying the impugned notification in the interest of justice. 8. Opposing the petitions, Mr. Parth Bhatt, learned senior standing counsel for the respondents, invited the attention of the court to the impugned notification to point out that the notification has been issued by the Central Government in exercise of powers under section 3 of the Act and that such notification has merely been authenticated by the Director General of Foreign Trade in accordance with the rules of business. Reference was made to the order dated 24.3.1993 of the Government of India, Ministry of Commerce granting status of ex officio Additional Secretary to the Government of India to the Director General of Foreign Trade so as to enable him to authenticate Orders/Notifications/Other Instruments in the name of the Central Government under the provisions of the Foreign Trade (Development and Regulation) Act, 1992. The attention of the court was further invited to the notification dated 16.2.2002 issued by the Ministry of Home Affairs in exercise of pow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he DGFT cannot exercise powers under sections 3, 5, 15, 16 and 19 of the Act. Consequently, the power to issue notification under these sections is vested only in the Central Government. It was submitted that when powers under sections 3, 5, 15, 16 and 19 of the Act cannot be delegated to the DGFT, as a necessary corollary it follows that notifications issued in exercise of such powers also cannot be authenticated by the DGFT. It was submitted that authentication of notifications issued in exercise of powers under sections 3, 5, 15, 16 and 19 of the Act by the DGFT would be in violation of the provisions of sub-section (3) of section 6 of the Act. It was submitted that the order dated 24.3.1993 relied upon on behalf of the respondents clearly states that the DGFT is enabled to authenticate Orders/Notifications/Other Instruments in the name of the Central Government under the provisions of the Foreign Trade (Development and Regulation) Act, 1992. Thus, even the authentication powers i.e. to authenticate Orders/Notifications are required to be exercised within the purview of the Act. 9.1 It was contended that the DGFT is a statutory authority appointed under the provisions of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de has no authority to exercise powers under section 3 of the Act inasmuch as such power is vested in the Central Government; while sub-section (3) of section 6 of the Act provides that the Central Government may delegate powers exercisable under the Act to the DGFT, sections 3, 5, 15, 16 and 19 have been specifically excluded therefrom, which means that such powers cannot be delegated. In support of such submission, reliance has been placed upon the decision of the Supreme Court in Director General of Foreign Trade v. Kanak Exports (supra) wherein the court has held that for the purpose of carrying out the objectives of the Act which includes implementation of the policy, the Central Government is authorized to appoint DGFT as per section 6 of the Act. The main functions of the DGFT are advising the Central Government and formulation of the policy and he is also responsible for carrying out the said policy. Sub-section (3) of section 6 of the Act provides that the Central Government may delegate its powers exercisable under the Act; however, the powers under sections 3, 5, 15, 16 and 19 are specifically excluded which means that these powers cannot be delegated. Thus, power to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule 2 thereof provides that all orders and other instruments made and authenticated in the name of the President shall be authenticated, and specifies the persons who may authenticate the same. Item No.12 therein provides that in case of orders and other instruments relating to the Directorate General of Foreign Trade, by the Director General of Foreign Trade, or the Additional Director General of Foreign Trade, or the Export Commissioner or Joint Director General of Foreign Trade. Thus, the Authentication Rules specifically empower the Director General of Foreign Trade to authenticate instruments relating to the Directorate General of Foreign Trade. A perusal of the impugned notification reveals that the same has been issued by the Government of India, Ministry of Commerce and Industries, Department of Commerce, Directorate General of Foreign Trade. Thus, by the impugned notification the amendment made by the Central Government in the import policy in exercise of powers under section 3 of the Act has been notified which relates to the Directorate General of Foreign Trade, accordingly, the same is authenticated by the Director General of Foreign Trade. Therefore, it is crystal clea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ht to the notice of that court and the court has proceeded on the footing that it is the DGFT which has exercised powers under section 3 of the Act. Hence, the said interim order does not come to the aid of the petitioners. 15. Another contention raised on behalf of the petitioner is that the provisions of sub-section (3) of section 19 of the Act which provides for laying the every rule and every order made by the Central Government under the Act, before each House of Parliament, have not been complied with. Since such contention which is a factual one, was raised only at the stage of arguments, it was not possible for the learned counsel for the respondents to state one way or the other as to whether the same has been complied with and since there was urgency on the part of the petitioners, the court did not deem it fit to adjourn the matter for verification of this aspect. In this regard reference may also be made to illustration (e) of section 114 of the Indian Evidence Act which provides that the court may presume that judicial and official acts have been regularly performed. It may also be apposite to refer to the decision of the Supreme Court in Atlas Cycle Industries Lt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch House of Parliament. Normally, no time limit is fixed for obtaining approval - none is necessary because the Government will naturally take the earliest opportunity of bringing it up for approval - but Section 16(3) of the Housing (Financial and Miscellaneous Provisions) Act, 1946 did impose a limit of forty days. An old form (not much used nowadays) provided for an order to be made but not to become operative until a resolution of both Houses of Parliament had been obtained. This form was used in Section 10(4) of the Road Traffic Act, 1930 [cf. Road Traffic Act, 1960, Section 19(3)] .... The affirmative resolution procedure necessitates a debate in every case. This means that one object of delegation of legislation (viz. saving the time of Parliament) is to some extent defeated. The procedure therefore is sparingly used and is more or less reserved to cases where the order almost amounts to an Act, by effecting changes which approximate to true legislation (e.g. where the order is the meat of the matter, the enabling Act merely outlining the general purpose) or where the order replaces local Acts or provisional orders and, most important of all, where the spending, etc. of publ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not a condition precedent but subsequent to the making of the order. In other words, there is no prohibition to the making of the orders without the approval of both Houses of Parliament. In these circumstances, we are clearly of the view that the requirement as to laying contained in sub-section (6) of Section 3 of the Act falls within the first category i.e. simple laying and is directory not mandatory. We are fortified in this view by a catena of decisions, both English and Indian. In Bailey v. Williamson, 1873 LR VII QB 118, where by Section 9 of the Parks Regulations Act, 1872 passed on June 27, 1872 to protect the royal parks from injury, and to protect the public in the enjoyment of those royal parks and other royal possessions for the purpose of innocent recreation and exercise it was provided that any rules made in pursuance of the first schedule to the Act shall be forthwith laid before both Houses of Parliament, if Parliament be sitting, or if not, then within three weeks after the beginning of the then next ensuing session of Parliament; and if any such rules shall be disapproved by either House of Parliament within one month of the laying, such rules, or such p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ime there was no Legislature in session, the Legislature having been suspended during the emergency arising out of World War II. The session of the Bombay Legislative Assembly was convened for the first time after 1941 on May 20, 1946 and that session was prorogued on May 24, 1946. The second session of the Bombay Legislative Assembly was convened on July 15, 1946 and that of the Bombay Legislative Council on September 3, 1946 and the rules were placed on the Assembly Table in the second session before the Legislative Assembly on September 2, 1946 and before the Legislative Council on September 13, 1946. Section 26(5) of Bombay Act 22 of 1939 does not prescribe that the roles acquired validity only from the date on which they were placed before the Houses of Legislature. The rules are valid from the date on which they are made under Section 26(1). It is true that the Legislature has prescribed that the rules shall be placed before the Houses of Legislature, but failure to place the rules before the Houses of Legislature does not affect the validity of the rules, merely because they have not been placed before the Houses of the Legislature. Granting that the provisions of sub-sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of any particular laying clause depends upon its own terms If a laying clause defers the coming into force of the rules until they are laid, the rules do not come into force before laying and the requirement of laying is obligatory to make the rule operative so the requirement of laying in a laying clause which requires an affirmative procedure will be held to be mandatory for making the rules operative, because, in such cases the rules do not come into force until they are approved, whether with or without modification, by Parliament. But in case of a laying clause which requires a negative procedure, the coming into force of the rules is not deferred and the rules come into force immediately they are made. The effect of a laying clause of this variety is that the rules continue subject to any modification that Parliament may choose to make when they are laid; but the rules remain operative until they are so modified. Laying clauses requiring a negative procedure are, therefore, construed as directory. The matter is put beyond controversy by the decision of the Supreme Court in Jan Mohd. v. State of Gujarat. Our conclusion, therefore, is that the laying requirement enacted in Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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