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Category: ACTS

  • CESTAT Kolkata- Quicklime Classified under CTH 25221000

    CESTAT Kolkata- Quicklime Classified under CTH 25221000

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 20.08.2025

    CESTAT Kolkata- Quicklime Classified under CTH 25221000 ​ ​ ​ ​ ​

    In a significant win for M/s. ITC Limited, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Kolkata, has ruled in favor of the appellant in Customs Appeal Nos. 75117 and 75118 of 2022. ​ The case revolved around the classification of imported goodsβ€”Quicklimeβ€”under the Customs Tariff Act, 1985. ​ The Tribunal’s decision has reaffirmed the correct classification of Quicklime under Customs Tariff Item No. ​ 2522 1000, bringing clarity to an issue that has been contested for years. ​

    Background of the Case

    The dispute arose when ITC Limited imported consignments of Quicklime and sought to classify them under Chapter Sub-Heading 2522 1000. ​ However, the Assessing Officer reclassified the goods under Chapter Sub-Heading 2825 9090, leading to a higher duty liability. ​ ITC Limited paid the duty under protest and subsequently challenged the assessment before the Commissioner of Customs (Appeals), who rejected their appeals. Aggrieved by this decision, ITC Limited approached the CESTAT Kolkata.

    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 Kolkata

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  • CESTAT Chennai- Reimbursements for actual expenses incurred by overseas branches are not taxable

    CESTAT Chennai- Reimbursements for actual expenses incurred by overseas branches are not taxable

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 20.08.2025

    CESTAT Chennai- Reimbursements for actual expenses incurred by overseas branches are not taxable ​ ​ ​

    The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Chennai, recently delivered a significant judgment in the case of MRF Ltd. v. Commissioner of Central Excise and Service Tax. This decision, pronounced on August 19, 2025, addresses the contentious issue of service tax liability on reimbursements made to overseas branch offices under the reverse charge mechanism. The ruling provides clarity on the interpretation of Section 66A of the Finance Act, 1994, and its implications for businesses with international operations. ​

    Background of the Case

    MRF Ltd., a leading tire manufacturer, operates branch offices in Australia, Dubai, Vietnam, and Sri Lanka. ​ During an audit in 2013, the Department of Central Excise and Service Tax observed that expenses incurred by these overseas offices were reimbursed by the Indian head office. ​ The Department contended that these reimbursements constituted “business support services” under Section 66A of the Finance Act, 1994, and demanded service tax of Rs. 58,38,707/- along with interest and penalties. ​

    MRF challenged this demand, arguing that the overseas branches were not separate legal entities but extensions of the same company. ​ They contended that reimbursements for expenses like salaries, rent, and office supplies could not be classified as taxable services.

    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 Chennai

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  • CESTAT Ahmedabad Partially Relaxes Provisional Release Conditions in SEZ Import Dispute

    CESTAT Ahmedabad Partially Relaxes Provisional Release Conditions in SEZ Import Dispute

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 19.08.2025

    CESTAT Ahmedabad Partially Relaxes Provisional Release Conditions in SEZ Import Dispute ​ ​ ​ ​

    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. ​ 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. ​ These goods were stored in the warehouse of M/s. ​ Cargo Care Agency, a SEZ unit in Kandla. ​ However, the Directorate of Revenue Intelligence (DRI) flagged the consignments, alleging misdeclaration of the goods’ nature and classification. ​ Following an investigation, the Customs Department seized the goods, citing potential misclassification and undervaluation, which could lead to revenue loss. ​

    The Commissioner of Customs allowed provisional release of the goods but imposed stringent conditions, including:

    1. Submission of a bond equal to the value of goods (β‚Ή1.93 crore). ​
    2. Submission of a bank guarantee of β‚Ή3.12 crore, covering the differential duty and potential penalties. ​

    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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  • CAAR Delhi Upholds Classification and Exemption for Mobile Phone Components

    CAAR Delhi Upholds Classification and Exemption for Mobile Phone Components

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 19.08.2025

    CAAR Delhi Upholds Classification and Exemption for Mobile Phone Components ​ ​

    The Customs Authority for Advance Rulings (CAAR), New Delhi, recently issued a significant ruling concerning the classification and exemption of certain goods intended for use in the manufacturing of mobile phone parts. ​ This ruling, dated August 6, 2025, provides clarity on the classification of specific items under the Customs Tariff Act, 1975, and their eligibility for exemption under Notification No. 57/2017-Customs. Below, we delve into the details of the ruling and its implications for importers and manufacturers. ​

    Background

    M/s Le Mei Plastic Manufacturing Private Limited filed an application seeking an advance ruling on the classification and exemption of goods such as aluminum plates, magnesium alloy sheets, heat-dissipating films, silicon pads, conductive foams, antennas, double-sided tape, and dust-proof paper. ​ These goods are intended for use in the manufacturing of intermediate components (front, middle, and back covers) for smartphones. ​

    The applicant argued that these goods are specifically designed for mobile phone manufacturing and should be classified under Tariff Heading 8517 79 90 as “Parts of Mobile Phones.” ​ Additionally, they sought confirmation on whether these goods qualify for exemption under Entry 6E of Notification No. ​ 57/2017-Customs.

    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: CAAR Delhi

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  • Karnataka High Court Upholds Conversion of Shipping Bills from MEIS to DEPB Scheme

    Karnataka High Court Upholds Conversion of Shipping Bills from MEIS to DEPB Scheme

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 18.08.2025

    Karnataka High Court Upholds Conversion of Shipping Bills from MEIS to DEPB Scheme​

    In a significant judgment delivered on July 30, 2025, the High Court of Karnataka at Bengaluru dismissed Customs Appeal No. 4 of 2022 filed by the Principal Commissioner of Customs, Bengaluru. ​ The case revolved around the conversion of shipping bills under export promotion schemes, and the court upheld the decision of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Bengaluru, in favor of the Assessee, M/s Louverline Blinds. ​

    Background of the Case

    M/s Louverline Blinds, engaged in the manufacture of motorized curtain and blind assemblies, imported inputs under an Advance Authorization License for manufacturing goods meant for export. ​ The Assessee filed six shipping bills under the Merchandise Export Incentive Scheme (MEIS) but later sought to amend them to reflect exports under the Advance Authorization License. The Principal Commissioner of Customs rejected this request, citing Section 149 of the Customs Act, 1962, and Circulars No. ​ 36/2010 and 6/2002. ​

    The Assessee appealed to the CESTAT, which ruled in its favor, allowing the conversion of shipping bills from the MEIS Scheme to the Duty Entitlement Passbook (DEPB) Scheme. ​ The Revenue challenged this decision in the High Court.

    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: Karnataka High Court

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  • Delhi High Court Orders Release of Confiscated Gold Chain

    Delhi High Court Orders Release of Confiscated Gold Chain

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 18.08.2025

    Delhi High Court Orders Release of Confiscated Gold Chain ​ ​ ​ ​

    In a significant ruling on August 7, 2025, the High Court of Delhi addressed the contentious issue of gold jewelry confiscation by customs authorities, setting a precedent for the treatment of personal effects under Indian law. ​ The case involved Appellant, a senior citizen and foreign national from Turkmenistan, who had traveled to India for medical treatment. Upon her arrival at Indira Gandhi International Airport on July 16, 2024, customs officials detained her gold chain (weighing 132 grams) and gold bracelet (weighing 66 grams), citing violations of customs regulations. ​

    Background of the Case

    Appellant filed a petition under Article 226 of the Constitution of India, seeking the release of her confiscated gold items. ​ While the Customs Department allowed her to redeem the gold bracelet upon payment of a fine and penalty, the gold chain was subjected to absolute confiscation. ​ This distinction between the two items raised questions about the legality and rationale behind the customs authorities’ actions.

    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: Delhi High Court

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  • CESTAT Ahmedabad Quashes β‚Ή20 Lakh Penalty on CHA

    CESTAT Ahmedabad Quashes β‚Ή20 Lakh Penalty on CHA

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 16.08.2025

    CESTAT Ahmedabad Quashes β‚Ή20 Lakh Penalty on CHA ​ ​ ​ ​

    In a significant judgment, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Ahmedabad, has set aside the penalty of β‚Ή20,00,000 imposed on Appellant, Manager of Customs House Agent (CHA) firm M/s. Shree Maruti Shipping Services. ​ The decision, delivered by Hon’ble Judicial, highlights the importance of adhering to principles of natural justice and the need for cogent evidence in penalty proceedings under the Customs Act, 1962.

    Background of the Case

    The case originated from an investigation by the Directorate of Revenue Intelligence (DRI), Mumbai, into the import of 208 MT of HDPE valued at β‚Ή54,07,418 under an allegedly forged advance license. ​ The investigation revealed discrepancies in the import documents, including the use of a non-existent firm, M/s. ​ Roha Dye Chem Pvt Ltd, as the importer. ​ The CHA firm, M/s. ​ Shree Maruti Shipping Services, was involved in processing the customs clearance documents. ​

    Initially, the Commissioner of Customs, Kandla, imposed a penalty of β‚Ή5,00,000 on Appellant under Section 112(b) of the Customs Act, 1962. ​ However, after multiple rounds of adjudication and remand proceedings, the penalty was enhanced to β‚Ή20,00,000 under Section 112(a) in the impugned order dated 24th September 2012. ​ Aggrieved by this decision, Appellant filed an appeal before the CESTAT.

    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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  • CESTAT Mumbai- Customs Cannot Deny DFIA and AA Exemptions Once DGFT Confirms Export Obligation

    CESTAT Mumbai- Customs Cannot Deny DFIA and AA Exemptions Once DGFT Confirms Export Obligation

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 16.08.2025

    CESTAT Mumbai- Customs Cannot Deny DFIA and AA Exemptions Once DGFT Confirms Export Obligation

    In a significant ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai, has set aside the duty demand and penalties imposed on M/s. ​ Tejus, a Surat-based importer, in connection with alleged misuse of Duty-Free Import Authorization (DFIA) and Advance Authorization (AA) schemes. ​ The case, which revolved around the interpretation of export obligation and post-importation conditions, has brought clarity to the jurisdictional limits of Customs authorities in such matters. ​

    Background of the Case

    M/s. Tejus, holding Import Export Code (IEC) No. ​ 349001499, had obtained DFIA and AA licenses for importing polyester filament yarn (PFY) and textured filament yarn (TFY). ​ The Directorate of Revenue Intelligence (DRI) alleged that the company had diverted imported goods to the local market without fulfilling the actual user conditions. ​ Following an investigation, the Commissioner of Customs (Export), Raigad, confirmed a duty demand of β‚Ή5.21 crore, along with penalties and redemption fines, citing violations of the Customs Act, 1962. ​

    The appellant challenged the order, arguing that the Customs authorities lacked jurisdiction to demand duty once the Export Obligation Discharge Certificate (EODC) was issued by the Directorate General of Foreign Trade (DGFT). ​ The appellant relied on precedents set by the Supreme Court and Bombay High Court, which held that Customs authorities cannot refuse exemptions based on allegations of misrepresentation if the licensing authority has not questioned the validity of the license.

    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 Mumbai

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  • CESTAT Hyderabad Quashes Penalties on Alleged Smuggling of Foreign-Origin Gold

    CESTAT Hyderabad Quashes Penalties on Alleged Smuggling of Foreign-Origin Gold

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 14.08.2025

    CESTAT Hyderabad Quashes Penalties on Alleged Smuggling of Foreign-Origin Gold ​ ​ ​

    On August 13, 2025, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Hyderabad, delivered a significant judgment in a series of appeals concerning the confiscation of smuggled gold, sale proceeds, and penalties imposed under the Customs Act, 1962. The case involved multiple appellants and revolved around the seizure of 40 gold bars with foreign markings and substantial cash, allegedly linked to smuggling activities. This blog delves into the key aspects of the case and the tribunal’s decision.

    Background of the Case

    The case originated from a seizure conducted by the Directorate of Revenue Intelligence (DRI) on November 21, 2019, at a residence in Secunderabad. The officers discovered 40 gold bars weighing 100 grams each, marked “AL ETIHAD DUBAI – UAE 100G 999.0,” along with cash totaling Rs. ​ 1,99,97,700. The gold and cash were concealed in a specially designed compartment of a vehicle. ​ Statements from the appellants revealed a complex network of transactions involving smuggled gold transported from Calicut to Hyderabad.

    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 Hyderabad

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  • PayTM gets Duty benefits and Penalty waiver relief from CESTAT

    PayTM gets Duty benefits and Penalty waiver relief from CESTAT

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 14.08.2025

    PayTM gets Duty benefits and Penalty waiver relief from CESTAT

    The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) recently delivered a significant judgment in the case of One97 Communications Limited (Paytm) regarding the import of Paytm Soundbox Versions 1 and 2. The case revolved around whether these devices were eligible for a concessional rate of Basic Customs Duty (BCD) under Serial No. ​ 20 of Notification No. ​ 57/2017. This blog delves into the details of the case, the arguments presented, and the final decision.

    Background of the Case

    One97 Communications Limited, the parent company of Paytm, imported Paytm Soundbox devices between 2019 and 2022. These devices are portable audio-activated smart devices that notify merchants of successful payments made by customers. ​ The company classified these devices under Customs Tariff Item (CTI) 8517 62 90 and claimed a concessional BCD rate of 10% under Serial No. ​ 20 of Notification No. ​ 57/2017.

    However, the customs department issued two show-cause notices alleging that the devices were 4G LTE compliant and therefore fell under the exclusionary clauses of the notification, making them ineligible for the concessional duty rate. ​ The department demanded differential duty and imposed penalties.

    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 Delhi

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