- within Antitrust/Competition Law topic(s)
GUJARAT HIGH COURT STAYS WITHDRAWAL OF QCOS ON POLYESTER YARN
Decision dated 4th May 2026
The Central Government, through the Ministry of Chemicals and Fertilizers and in exercise of powers conferred under Section 16 of the Bureau of Indian Standards Act, 2016 (BIS Act, 2016), introduced a set of Quality Control Orders (QCOs) in 2022 and 2023 mandating compliance with Indian Standards for specified Polyester Yarn products. The QCOs issued were as follows:
- Polyester Industrial Yarn (Quality Control) Order, 2022, bearing S.O. 1652(E)
- Polyester Continuous Filament Fully Drawn Yarn (Quality Control) Order, 2023, bearing S.O. 3193(E) dated 17th July 2023.
- Polyester Partially Oriented Yarn (Quality Control) Order, 2023, bearing S.O. 3194(E) dated 17th July 2023.
Subsequently, on 12th November 2025, the Central Government rescinded the aforesaid QCOs with immediate effect. As a consequence, the requirement of mandatory BIS compliance for these products stood withdrawn. Aggrieved by this sudden withdrawal, domestic manufacturers of the concerned products approached the Hon'ble Gujarat High Court challenging the said withdrawal notifications. The Hon'ble High Court of Gujarat has passed interim order in the following cases: -
- Shree Durga Syntex Pvt. Ltd. Versus Union of India & Ors.
- Shiven Yarn Private Limited Versus Union of India & Ors
By the interim order dated 4th May 2026, the Hon'ble Gujarat High Court granted relief to domestic manufacturers of Polyester Partially Oriented Yarn, Polyester Continuous Filament Fully Drawn Yarn, and Polyester Industrial Yarn by staying the operation of the notification through which the Central Government had withdrawn the Quality Control Orders (QCOs) on these products. As a result of the interim order, the earlier Quality Control Orders implemented stand revived.
A special leave petition challenging the order was filed by one of the importers directly in Supreme Court without approaching high court. The Supreme Court has declined to interfere with the stay order.
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