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Date: 23.05.2026
MP High Court Holds BIS Clarificatory Circular Cannot Be Applied Retrospectively to Imported Alloy Steel Consignments
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
In a significant legal victory, Anik Industries Limited successfully challenged the customs authorities’ refusal to clear its imported alloy steel deformed bars. The High Court of Madhya Pradesh, Indore Bench, delivered a detailed judgment on June 14, 2016, addressing complex issues of customs regulations, retrospective application of government circulars, and territorial jurisdiction.
Background of the Case
Anik Industries Limited, a private company engaged in importing alloy steel deformed bars, placed orders with Chinese manufacturers in mid-2014. The goods were shipped and arrived at Indian ports (Mumbai and Chennai) before a crucial customs circular (No. 450/176/2014-Cus-IV dated 7/11/2014) was issued. This circular, along with amendments to the Steel Products (Quality Control) Order, imposed new requirements for Bureau of Indian Standards (BIS) certification on certain steel imports.
When Anik Industries sought clearance for its consignments, customs authorities refused, citing the new circular and amendments. Anik Industries argued that these requirements could not be applied retrospectively to goods contracted and shipped before the circular’s issuance.
Key Legal Issues
- Retrospective Application of Circulars
- The central question was whether the customs circular and amended quality control orders could be applied to shipments contracted and dispatched before their effective dates.
- The court held that no clarificatory circular or amendment can operate retrospectively to affect transactions already completed. The contract and shipment predated the circular, so the new requirements could not be imposed on Anik Industries’ consignments.
- Jurisdiction of the Indore High Court
- Customs authorities and intervenors argued that the Indore Bench lacked jurisdiction since the goods were at Mumbai and Chennai ports and the circular was issued in Delhi.
- The court found that since Anik Industries’ corporate office was in Indore, the order was placed and payment made from Indore, and the goods were intended for Indore, a part of the cause of action arose within its jurisdiction. Thus, the writ petition was maintainable at Indore.
- Validity and Scope of the Customs Circular
- The court examined whether the circular could extend the scope of the Steel Products (Quality Control) Order to cover alloy steel deformed bars without a formal amendment to the schedule.
- It concluded that only a proper amendment, not a departmental clarification, could expand the order’s coverage. The circular could not add new conditions or apply to products not explicitly listed.
The Court’s Decision
The High Court dismissed the appeals by customs authorities and industry associations, upholding the writ court’s earlier order. Key directions included:
- Customs authorities were ordered to allow clearance of Anik Industries’ goods covered by commercial invoices dated September 4 and 18, 2014.
- The court clarified that it was not making any observation on the application of BIS standards to future imports under the impugned circular.
- If, after release, authorities still doubted the goods’ compliance with BIS standards, they could investigate further, and Anik Industries was directed to cooperate.
Implications of the Judgment
This judgment sets an important precedent for importers facing retrospective application of regulatory changes. It reinforces the principle that government circulars and amendments cannot retroactively affect completed transactions. The decision also clarifies the scope of High Court jurisdiction in writ matters involving national regulations and cross-state transactions.
Conclusion
Anik Industries Limited’s victory underscores the importance of legal safeguards against retrospective regulatory actions and affirms the rights of businesses to challenge arbitrary administrative decisions. The case serves as a reference point for future disputes involving customs regulations and the importation of goods into India.
Source: Madhya Pradesh High Court
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