Customs Cannot Apply Later Interim Order Retrospectively To Demand BIS Certification: Gujarat High Court

The Gujarat High Court on 15 June held that customs authorities cannot withhold imported consignments by retrospectively applying a subsequent interim order and insisting on Bureau of Indian Standards (BIS) certification for goods imported during a period when such certification was not mandatory.

A Division Bench of Justices A.S. Supehia and Vaibhavi D. Nanavati allowed a petition filed by Hilotex International Pvt. Ltd., holding that customs authorities acted arbitrarily in placing imported consignments on hold despite imports having taken place during a BIS-free regime. The Judges held:

"The respondents have, thus, acted arbitrary in applying the interim order dated 04.05.2025 staying the operation of the Notification dated 12.11.2025 with respect to Bills of Lading during the subsistence of the Notification dated 12.11.2025, which was BIS free regime. The customs authority could not have insisted upon BIS certification by placing the cargo on hold by applying the interim order passed by this Court."

Hilotex International Pvt. Ltd. challenged customs authorities' refusal to clear consignments of Polyester Continuous Filament Fully Drawn Yarn on the ground that BIS certification was required. The company pointed out that the Central Government rescinded the Polyester Continuous Filament Fully Drawn Yarn (Quality Control) Order, 2023 through a notification dated 12 November 2025, thereby creating a BIS-free regime.

During this period, Hilotex entered into contracts with overseas suppliers, placed purchase orders, made advance payments, and arranged shipment of goods. It stated that 20 shipments comprising 53 containers were covered by Bills of Lading issued between 16 April 2026 and 4 May 2026, i.e., prior to an interim order dated 4 May 2026 passed in another pending matter staying the operation of the rescission notification.

Despite this, customs authorities withheld clearance of the consignments and placed the cargo under hold on the ground of BIS certification requirements. The Court noted that Hilotex's stand remained uncontroverted and observed that earlier decisions of the High Court and the Supreme Court already covered the issue.

The Bench held that authorities could not apply the subsequent interim order retrospectively to imports already contracted, paid for, and shipped during the BIS-free regime.

Accordingly, the High Court allowed the writ petition.

Appearance for the Petitioner: Mr. Anandodaya S. Mishra, Mr. Mayur Punjabi and Ms. Dhwani Tandon.

Appearance for the Respondents: Mr. Ankit Shah.