DRI Versus Importers: Bombay High Court Examines Mining Tyre Classification and Provisional Release

Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration

Date: 12.11.2026

DRI Versus Importers: Bombay High Court Examines Mining Tyre Classification and Provisional Release

The Bombay High Court has ruled in favour of six tyre importers, including Vikas Retail Private Limited, and ordered the provisional release of seized consignments described as mining tyres, while leaving the final classification and duty dispute to Customs adjudication.

A classification dispute with major import consequences

The case turned on whether the imported tyres were:

• Mining, construction or industrial-handling tyres under Customs Tariff Item (CTI) 40118000, which are freely importable; or
• Truck and Bus Radial (TBR) tyres under CTI 40112010, which are restricted under India’s import policy.

The importers declared the products as “Brand New All Steel Radial Mining Tyres,” including size 10.00 R20-18PR tyres bearing a “D” speed symbol, meaning a maximum speed of 65 km/h. They maintained that the tyres were intended for mining and off-road applications and had been imported under CTI 40118000 since 2019.

The Directorate of Revenue Intelligence (DRI) and Customs alleged that the tyres were in fact TBR tyres. According to the Department, the “D” marking, mining symbol and related markings were added to avoid the licensing and Bureau of Indian Standards (BIS) requirements applicable to restricted truck and bus radial tyres.

Why Customs seized the goods

The disputed imports arrived between February and April 2024 through bills of entry filed at Nhava Sheva and other ports. Customs seized the goods from the port and from importers’ godowns after beginning an investigation into alleged misdeclaration.

Customs refused the importers’ applications for provisional release under Section 110A of the Customs Act. Its position was that the goods could be prohibited because they were allegedly misclassified, imported without the approvals applicable to TBR tyres and lacked BIS compliance.

The Commissioner of Customs (Appeals) upheld the refusal. The appellate authority cited public interest and road-safety risks, expressing concern that released tyres could be sold for use on road-going trucks and buses.

Importers relied on past clearances and technical reports

The importers argued that Customs had previously accepted the same classification for identical tyres. They had imported comparable tyres for years, and the Department had cleared consignments described as radial mining tyres under CTI 40118000.

Technical reports played a central role:

• In 2020 and 2021, IRMRA reports obtained by an importer stated that the intended use of the tyres was mining applications.
• In 2022, when Customs’ Central Intelligence Unit detained similar tyres, IRMRA reported that the “D” speed symbol placed the tyres outside the scope of IS 15636:2012 and identified their intended use as mining and logging off-road applications.
• Customs then issued no-objection certificates and released those 2022 consignments.

The importers also relied on the Quality Control Order and government instructions that exclude commercial-vehicle tyres with speed symbols below 80 km/h, including symbols A to E, from the relevant BIS quality-control framework.

CESTAT granted conditional release

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) overturned the refusal and ordered provisional release in July 2024. It found that Customs had not produced technically competent evidence establishing that the imported goods were restricted TBR tyres.

CESTAT emphasized that classification must be based on the imported goods’ technical characteristics at the time of import. An allegation that tyres could later be misused on trucks or buses was not, by itself, sufficient to determine their classification.

The release was subject to safeguards:

1. The importers must furnish a bond for the full value of the seized goods.
2. They must provide a bank guarantee equal to 5% of the goods’ value.
3. They must undertake not to sell the tyres to dealers or end users who would sell or use them for road-going trucks, buses or similar vehicles.

Customs later sought rectification of the CESTAT order, relying on test reports that had not been placed before the Tribunal during the original hearing. CESTAT rejected that attempt, holding that a rectification application could not be used to introduce new material that was not previously presented.

High Court: the goods were not shown to be prohibited

The Bombay High Court upheld CESTAT’s decision and dismissed the Customs Department’s writ petition and appeals. The Court’s reasoning focused on the legal difference between restricted goods and prohibited goods.

Under the 2020 import-policy change, radial tyres used on buses and lorries became restricted. However, tyres used on construction, mining or industrial-handling vehicles under CTI 40118000 remained freely importable.

The Court held that, at the provisional-release stage, Customs had not established that the goods were prohibited. It observed that tyres bearing the “D” speed symbol, corresponding to 65 km/h, fall below the 80 km/h threshold covered by IS 15636. As a result, the BIS standard invoked by Customs did not directly govern those tyres.

The Court also noted that the 2009 Quality Control Order and subsequent official instructions expressly excluded certain low-speed commercial-vehicle tyres, including tyres marked with speed symbols A to E.

Later testing did not resolve the classification question

In 2024, at DRI’s request, IRMRA tested samples on assumptions that disregarded the “D” speed marking and assessed the tyres for higher-speed use, including categories up to 110 km/h. Those reports indicated suitability for normal highway truck-and-bus applications under the assumptions used for testing.

However, the High Court noted that the later court-directed IRMRA report of April 2025 was inconclusive on the ultimate classification question. The report stated that:

• Based on the “D” sidewall marking, the tyres were classified as special-use tyres.
• The conclusion that they could be suitable for normal highway use was based on tests performed under specific assumptions and irrespective of the marked speed symbol.
• The laboratory lacked clear and specific standards or criteria to definitively decide whether the tyres were special-use tyres or normal-road-use tyres.

The Court considered this uncertainty significant. Since the Department had not conclusively shown that the goods were prohibited, Customs could not rely on the prohibition-based restriction in the provisional-release circular to continue withholding them.

Restricted does not automatically mean prohibited

The Court rejected Customs’ argument that goods allegedly imported without a DGFT licence or BIS certification should automatically be treated as prohibited goods.

Relying on the distinction recognized by the Supreme Court in Commissioner of Customs v. Atul Automation Pvt. Ltd., the Court held that restricted goods and prohibited goods are not identical categories. Goods subject to regulatory conditions or authorisation requirements are not necessarily goods whose import is completely barred.

The Court also distinguished the Supreme Court’s decision in Union of India v. Raj Grow Impex LLP. That case involved imports exceeding a strict quantitative limit, where imports beyond the cap were completely barred. The tyre dispute was different because the essential issue, whether the goods were mining tyres or restricted TBR tyres, had not yet been finally determined.

Final order: release required, final merits still open

The High Court dismissed the Customs Department’s writ petition and six customs appeals. It allowed the six writ petitions filed by the importers: Pioneer Trading Corporation, Tiara Enterprises, Leo Distributors Private Limited, Trans Tyres LLP, Vikas Retail Private Limited and Aahana Consultancy Limited.

The Court directed provisional release of the seized goods covered by the CESTAT order, subject to the Tribunal’s conditions. It also refused the Department’s request to stay the ruling, noting that release had already been delayed despite the Tribunal’s order.

The judgment does not finally settle the tariff classification dispute. Customs has issued a show-cause notice alleging that the importers misdeclared TBR tyres as mining or off-road tyres. The notice proposes confiscation and seeks differential duty of Rs. 8,37,80,608, together with applicable interest.

The Court expressly stated that its observations on provisional release will not affect that pending adjudication. The final determination of classification, confiscation and duty liability therefore remains open.

Key takeaway

The ruling confirms that Customs cannot deny provisional release merely on an unresolved allegation that goods are prohibited. Where the technical classification remains disputed and the evidence does not conclusively establish prohibition, release may be ordered with financial and end-use safeguards, while the final customs proceedings continue separately.

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Source: Bombay High Court

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Ravi Shekhar Jha – Advocate, Bar Council of Delhi