Delhi High Court Grants Importers Interest On Customs Duty Refunds After Delay In Re-Assessment By Department

The Delhi High Court has recently held that importers are entitled to interest on refunds of excess customs duty in cases where prolonged delay in reassessment is attributable to the Department. A Division Bench of Justice Prathiba M. Singh and Justice Shail Jain observed, "For the delay in Department's passing of the re-assessment orders, the Petitioners cannot be blamed or expected to unduly suffer. Accordingly, the Court is of the view that in the said four writ petitions, the interest...

Bombay HC Quashes SCNs Against Foreign Exporter, Says Customs Act Had No Extra-Territorial Reach Pre-2018

The Bombay High Court has quashed show cause notices issued by customs authorities against a German textile machinery manufacturer and its Indian subsidiary, holding that the notices were without jurisdiction and that a foreign exporter cannot be made liable for alleged misdeclaration by Indian importers for a period prior to the 2018 amendment to the Customs Act. A Bench of Justice G. S. Kulkarni and Justice Aarti Sathe held that proceedings initiated against a foreign entity situated outside...

CESTAT New Delhi Allows Refund Of Service Tax On Cancelled Project, Rejects Limitation Bar

The New Delhi Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) on 8 April held that authorities cannot deny refund of service tax paid on advances received for construction services on the ground of limitation, where the project is subsequently cancelled and the amounts are returned to customers. A Bench comprising Judicial Member Binu Tamta and Technical Member P.V. Subba Rao allowed the appeal filed by Reach Promoters Pvt. Ltd. and remanded the matter, holding that...

CESTAT Delhi Denies Nikon ₹7.32 Crore Refund, Holds Claim Pre-Exemption Decision Is Not Maintainable

The New Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), New Delhi on 6 April, held that a refund claim filed before final adjudication of the underlying exemption dispute is not maintainable, even where duty has been paid under protest. A Bench comprising President Justice Dilip Gupta and Technical Member P.V. Subba Rao dismissed the appeal filed by Nikon India Private Limited and upheld rejection of its refund claim. The Tribunal held: “The facts of the...

Department Cannot Allege Excess Imports Without Explaining IGCR Clearance Irregularly: CESTAT New Delhi

On 10 April, the New Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that where imported goods are cleared under the IGCR procedure, the Department cannot allege excess imports without explaining how customs officers permitted such clearance. A Bench of President Justice Dilip Gupta and Technical Member P.V. Subba Rao set aside a customs duty demand of Rs. 31.40 lakh against K.A. Enterprises. They observed: “In the absence of any recording as to which of...

CESTAT New Delhi Sets Aside Penalty On Time Avenue, Finds No Link To Importer's RSP Misdeclaration

The New Delhi Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) on 10 April set aside a penalty of Rs. 20,000 imposed on Time Avenue Pvt. Ltd. under Section 112(b) of the Customs Act. A Bench comprising President Justice Dilip Gupta and Technical Member Hemambika R. Priya held that the penalty under Section 112(b) could not be sustained in the absence of proof that the appellant knew the goods were liable to confiscation. The Tribunal observed: “There is no...

CESTAT Ahmedabad Upholds Fabric Reclassification Based On CRCL Test, Remands Valuation, SEZ Exemption

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Ahmedabad Bench, has upheld the reclassification of imported synthetic fabrics, holding that laboratory test results clearly disproved the importer's declaration and rejecting a retesting plea raised after 11 years, while remanding valuation and SEZ exemption issues for fresh adjudication.A bench of Judicial Member Somesh Arora and Technical Member Satendra Vikram Singh allowed the Revenue's appeal against relief granted to Om...

AIFTA Duty Exemption For Scrap Cannot Be Denied To Jindal Aluminum For No Country of Origin Markings: CESTAT Chennai

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has recently granted relief to Jindal Aluminium Ltd., holding that exemption under the ASEAN–India Free Trade Agreement (AIFTA) cannot be denied merely due to the absence of country-of-origin markings on imported scrap goods.The Bench comprising Judicial Member Ajayan T.V. and Technical Member M. Ajit Kumar allowed the appeal filed by Jindal Aluminium Ltd. and set aside the order of the...

CESTAT New Delhi Sets Aside ₹51.8 Lakh Customs Duty On CONCOR, Finds No Proof of Pilferage Or Seal Tampering

The New Delhi Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that, in the case of CONCOR, a custodian cannot be fastened with customs duty liability under Section 45 of the Customs Act, 1962 in the absence of evidence showing pilferage during its custody or tampering of seals of imported goods. Section 45 of the Customs Act, 1962, mandates that all imported goods unloaded in a customs area remain under the custody of an approved custodian until they are...

'Suspicion, Howsoever Grave, Cannot Replace Proof': CESTAT Hyderabad Sets Aside Export Undervaluation Demand

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Hyderabad, has held that allegations of export undervaluation and demand of differential duty cannot be sustained in the absence of cogent and admissible evidence establishing receipt of additional consideration, setting aside the order against M/s Temple City Developers Pvt. Ltd. and others. The Bench comprising Judicial Member Angad Prasad and Technical Member A.K. Jyotishi observed, “While there is no denial that charges of...

Importer Not Liable For Post-Sale RSP Revision By Dealers: CESTAT New Delhi

The New Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 9 April, held that an importer cannot incur liability for differential customs duty based on a post-sale upward revision of Retail Sale Price (RSP) by independent dealers, once the parties complete the sale on a principal-to-principal basis. A Bench comprising President Dilip Gupta and Technical Member Hemambika R. Priya set aside the demand raised against Richemont India Pvt. Ltd., holding that the...

Kerala High Court Quashes 25 kg Gold Confiscation, Holds Denial Of Cross-Examination Vitiates Proceedings

The Kerala High Court on 3 March quashed a customs confiscation order involving 25 kilograms of gold, holding that denying the petitioners an effective opportunity to adduce evidence and cross-examine witnesses caused prejudice and violated principles of natural justice. Justice Ziyad Rahman A A, sitting as a Single-Judge Bench, allowed writ petitions challenging the Order-in-Original passed by the Customs authority, which had confiscated the gold and imposed penalties. He observed: “The...