ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 19.08.2025
CESTAT Ahmedabad Partially Relaxes Provisional Release Conditions in SEZ Import Dispute β β β β
In a significant ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), West Zonal Bench at Ahmedabad, has partially relaxed the conditions imposed by the Commissioner of Customs, Kandla, for the provisional release of goods seized from a Special Economic Zone (SEZ). The case, involving H.R. β Enterprises, highlights the complexities of customs law, SEZ regulations, and the balance between safeguarding revenue and ensuring fair treatment for importers.
Background of the Case
H.R. Enterprises, an importer of goods, had brought in 16 consignments of fabrics declared as “leftover of tarpaulin fabrics mix size and GSM” from China. β These goods were stored in the warehouse of M/s. β Cargo Care Agency, a SEZ unit in Kandla. β However, the Directorate of Revenue Intelligence (DRI) flagged the consignments, alleging misdeclaration of the goods’ nature and classification. β Following an investigation, the Customs Department seized the goods, citing potential misclassification and undervaluation, which could lead to revenue loss. β
The Commissioner of Customs allowed provisional release of the goods but imposed stringent conditions, including:
- Submission of a bond equal to the value of goods (βΉ1.93 crore). β
- Submission of a bank guarantee of βΉ3.12 crore, covering the differential duty and potential penalties. β
H.R. Enterprises challenged these conditions before the Tribunal, arguing that they were onerous and would cripple their business.
This Article has been written by Shri Ravi Shekhar Jha, Advocate Delhi High Court based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
Source: CESTAT Ahmedabad
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