ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 09.02.2026
Madras High Court Quashes Customs Order for Non-Adherence to Mandatory Timelines Under CBLR- 2018
Adv Ravi Shekhar Jha
This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email idΒ intelconsul@gmail.com or on his Mobile +91-9999005379.Β β Β β ββ β β
The Madras High Court, in a landmark judgment dated January 29, 2026, has quashed an order passed by the Principal Commissioner of Customs (General), Chennai Customs Zone, for failing to adhere to the mandatory timelines prescribed under the Customs Brokers Licensing Regulations (CBLR), 2018. The case, WP No. β 27861 of 2025, was presided over by the Honourable Justice. β
Background of the Case
The petitioner, M/s. Shriwin Shipping and Logistics, represented by its partner, filed a writ petition challenging the impugned order in Original No. β 113023/2025 dated April 7, 2025. β The order imposed a penalty of βΉ15,000 under Regulation 18 of CBLR, 2018. β The petitioner argued that the order was passed without jurisdiction, authority of law, and in violation of the principles of natural justice and fundamental rights guaranteed under the Constitution of India. β
The petitioner contended that the respondent failed to adhere to the mandatory timelines prescribed under Regulation 17 of CBLR, 2018, which stipulates that the entire proceedings must be completed within nine months from the date of the offence report. β In this case, the show-cause notice issued on June 27, 2024, was considered the offence report, and the proceedings should have been completed by March 26, 2025. β However, the impugned order was passed on April 7, 2025, exceeding the prescribed timeline. β
Courtβs Observations
Justice Abdul Quddhose noted that the Division Bench of the Madras High Court had previously ruled in the case of M/s. β Santon Shipping Services vs. β The Commissioner of Customs, Tuticorin and Another (judgment dated October 13, 2017) that the timelines under CBLR, 2018, are mandatory and must be strictly adhered to. β This precedent has been consistently upheld in subsequent cases by the Madras High Court. β
The respondent argued that the timelines under CBLR, 2018, are directory rather than mandatory, citing decisions from other High Courts. β However, the Madras High Court rejected this contention, emphasizing that the Division Benchβs judgment remains binding and has not been overruled by the Supreme Court. β
Key Takeaways from the Judgment
Mandatory Nature of Timelines: The court reaffirmed that the timelines prescribed under Regulation 17 of CBLR, 2018, are mandatory and must be strictly followed. β Any deviation from these timelines renders the proceedings invalid. β
Adherence to Precedent: The court emphasized the importance of adhering to its own precedents, particularly the Division Bench judgment in M/s. β Santon Shipping Services, which has consistently been followed in similar cases. β
Violation of Natural Justice: The court highlighted that the impugned order was passed without following due procedures of law, violating the principles of natural justice and the petitionerβs fundamental rights. β
Quashing of Impugned Order: The court quashed the impugned order dated April 7, 2025, and allowed the writ petition, citing the respondentβs failure to comply with the mandatory timelines. β
Implications of the Judgment
This judgment serves as a significant reminder to authorities to strictly adhere to the timelines prescribed under the Customs Brokers Licensing Regulations, 2018. β It underscores the importance of procedural compliance and the protection of fundamental rights in administrative proceedings. β The decision also highlights the judiciaryβs role in upholding the rule of law and ensuring that government authorities act within the bounds of their jurisdiction. β
Conclusion
The Madras High Courtβs decision in WP No. β 27861 of 2025 is a landmark ruling that reinforces the mandatory nature of timelines under CBLR, 2018. It sets a strong precedent for similar cases and ensures that administrative authorities are held accountable for adhering to legal procedures. β This judgment is a victory for the principles of natural justice and the protection of fundamental rights, and it serves as a crucial reference point for future cases involving the Customs Brokers Licensing Regulations.
ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 01.01.2026
Madras High Court Issues Writ of Mandamus Directing Release of Confiscated Imported Goods Under Quality Control Order
This Article has been written by Shri Ravi Shekhar Jha, Advocate based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.comor on his Mobile +91-9999005379.
In a significant legal development, the Madras High Court recently ruled in favor of Urban Essentials India Pvt. Ltd., directing the Commissioner of Customs, Chennai β II (Import), to release the companyβs imported goods. β The case, W.P.No.50475 of 2025, revolved around the import of feminine hygiene products and the applicability of the Medical Textiles (Quality Control) Order, 2024, issued by the Ministry of Textiles. β
Background of the Case
Urban Essentials India Pvt. β Ltd., represented by its director, is a Chennai-based importer of feminine hygiene products, including sanitary napkins and panty liners. β These products are manufactured in China using advanced technology unavailable in India and are sold under the brand name βPlush.β The Chinese manufacturer had applied for certification under the Bureau of Indian Standards (BIS) Foreign Manufacturer Certification Scheme, as the products fall under BIS Schedule-A and must comply with BIS standard IS 5045:2019. β
The company imported goods under two Bills of Entry dated 29.03.2025 and 31.03.2025. β However, an alert notice issued by the Additional Commissioner of Customs on 27.02.2025 raised concerns about the applicability of the Quality Control Order (QCO) on imports. β The Department of Promotion of Industry and Internal Trade (DPIIT) clarified that the relaxation granted in the QCOs for obtaining BIS licenses under Conformity Assessment Rules did not apply to imports. β This led to the confiscation of the petitionerβs goods under Section 111(d) of the Customs Act, along with penalties and fines. β
Legal Proceedings
Urban Essentials India Pvt. β Ltd. filed multiple writ petitions to seek the release of their goods. β Initially, the High Court directed the Commissioner of Customs to pass orders within four weeks. β However, the Customs Department ordered the confiscation of the goods, imposed a fine of βΉ10,00,000/- under Section 125(1) of the Customs Act, and levied a penalty of βΉ5,00,000/- under Section 112(a)(i) of the Customs Act. β The department argued that the goods did not conform to BIS standards and were imported in violation of the QCO. β
The petitioner challenged this order in W.P.No.37033 of 2025, but the High Court dismissed the petition, stating that the QCO applied to manufacturers and not importers. β The court advised the petitioner to seek an alternate remedy before the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT). β
Subsequently, the petitioner filed an appeal before the CESTAT, along with a miscellaneous application seeking interim relief for the release of goods and a stay on the order-in-original. β On 22.12.2025, the CESTAT allowed the application, granting a stay on the operation of the impugned order and permitting the provisional release of the goods.
The High Courtβs Final Decision
Despite the CESTATβs order, the Commissioner of Customs did not release the goods, prompting Urban Essentials India Pvt. Ltd. to file another writ petition (W.P.No.50475 of 2025) seeking a writ of mandamus for the release of the goods. The case was heard by the Honourable Justice on 26.12.2025. β
After carefully considering the submissions from both sides, the court ruled in favor of the petitioner. Justice noted that the petitioner, as an importer and a registered MSME under the UDYAM Registration Certification, was entitled to the benefit of the extended timeline granted under the second amendment to the QCO dated 30.07.2025. β This amendment allowed importers to sell, display, or offer to sell declared stocks up to 31.12.2025, provided the goods were imported before 01.04.2025.
The court also emphasized the importance of adhering to judicial orders under Article 261 of the Constitution of India, which mandates βfull faith and creditβ to judicial decisions. β Since the CESTAT had already stayed the order-in-original and allowed the petitionerβs application for provisional release, the High Court directed the Commissioner of Customs to comply with the CESTATβs order. β
Key Takeaways from the Judgment
Recognition of MSMEs: The court acknowledged the petitionerβs status as a registered MSME and upheld its entitlement to the extended timeline under the QCO amendment. β
Judicial Authority: The judgment reinforced the principle that judicial orders from quasi-judicial authorities like the CESTAT must be respected and implemented. β
Provisional Release of Goods: The court ordered the release of the goods, subject to the petitioner depositing βΉ15,00,000/- with the respondent within 24 hours. β This deposit was to be made without prejudice to the rights of the parties, ensuring that the ongoing appeal before the CESTAT would not be influenced by the High Courtβs observations. β
Conclusion
The Madras High Courtβs decision in favor of Urban Essentials India Pvt. Ltd. is a significant victory for importers and MSMEs navigating complex regulatory frameworks. It highlights the importance of judicial oversight in ensuring fair treatment and compliance with statutory provisions. β As the case proceeds to the CESTAT for final adjudication, this judgment serves as a reminder of the judiciaryβs role in upholding the rights of businesses while balancing regulatory compliance.
ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 23.12.2025
Madras High Court Declares GST Notifications Illegal
This Article has been written by Shri Ravi Shekhar Jha, Advocate based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.comor on his Mobile +91-9999005379.
On December 17, 2025, the Madurai Bench of the Madras High Court delivered a landmark judgment in favor of Tvl Voylla Fashions Private Limited, represented by its authorized signatory. The case, W.P. β(MD) No. β 36017 of 2025, challenged the validity of two GST notifications issued by the Union of India: Notification No. 09/2023-Central Tax dated 31.03.2023 and Notification No. β 56/2023-Central Tax dated 28.12.2023. β The court ruled these notifications as vitiated and illegal, marking a significant victory for the petitioner. β
Background of the Case
The petitioner, Tvl Voylla Fashions Private Limited, filed a writ petition under Article 226 of the Constitution of India, seeking a writ of certiorari to quash the impugned notifications and the consequential assessment order passed by the Assistant Commissioner (ST) (FAC) for the assessment year 2019-2020. The petitioner argued that the notifications violated several constitutional provisions, including Article 14, 246A, and 265, and were ultra vires Section 168A of the Central Goods and Services Tax Act, 2017. β
The petitioner contended that the notifications were issued retrospectively, curtailing the limitation period for assessment and adjudication under the CGST Act. β This, they argued, was contrary to the Supreme Court’s order dated January 10, 2022, which excluded the period from March 15, 2020, to February 28, 2022, for the purpose of calculating the limitation period under Section 73 of the CGST Act. β
Key Arguments and Court Observations
During the hearing, the learned counsel for the petitioner and the Additional Government Pleader representing the respondents presented their arguments. β The court noted that the issue raised in this case had already been addressed in a previous judgment delivered on June 12, 2025, in W.P. β Nos. 17184 of 2024, where the court had categorically held that:
The authorities under the CGST Act are entitled to exclude the period from March 15, 2020, to February 28, 2022, while calculating the limitation period under Section 73 of the CGST Act, as per the Supreme Court’s order under Article 142 of the Constitution. β
The impugned notifications were vitiated and illegal for several reasons:
They curtailed the limitation period contrary to the Supreme Court’s order under Article 142. β
They were based on erroneous assumptions and misconceptions about the scope and effect of the Supreme Court’s order. β
They arbitrarily extinguished the vested rights of action available to authorities under the CGST Act. β
Notification No. 56/2023 was issued without the recommendations of the GST Council, violating the statutory mandate. β
The court also highlighted issues such as the violation of principles of natural justice, lack of jurisdiction, and errors apparent on the face of the record. β
The Courtβs Decision
After considering the submissions and referring to the earlier judgment, the Honorable Justice ruled in favor of the petitioner. The court declared the impugned notifications as vitiated and illegal and set aside the consequential assessment order dated August 28, 2024. The court directed the authorities to treat the impugned order as a show cause notice and allowed the petitioner to submit objections within 8 weeks. β The authorities were instructed to pass fresh orders after providing the petitioner an opportunity for a hearing. β
Implications of the Judgment
This judgment is a significant victory for taxpayers and businesses, as it reinforces the importance of adhering to constitutional principles and statutory mandates while issuing notifications under the GST framework. The courtβs decision highlights the following key points:
Protection of Vested Rights: The judgment ensures that taxpayers’ rights are not arbitrarily curtailed by retrospective notifications that diminish the limitation period for assessment and adjudication. β
Adherence to Supreme Court Orders: The ruling underscores the importance of complying with the Supreme Courtβs directives, particularly those issued under Article 142 of the Constitution. β
Role of the GST Council: The judgment reiterates the statutory requirement for the GST Councilβs recommendations before issuing notifications, ensuring transparency and accountability in the decision-making process. β
Conclusion
The Madurai Bench of the Madras High Court has once again demonstrated its commitment to upholding the rule of law and protecting the rights of taxpayers. The victory of Tvl Voylla Fashions Private Limited serves as a reminder to authorities to exercise their powers within the bounds of the law and constitutional principles. This case sets a precedent for future challenges to arbitrary and retrospective notifications, ensuring a fair and just taxation system for all stakeholders.
ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 10.12.2025
Madras High Court Quashes Customs Inquiry Report for Breach of Mandatory Timelines Under CBLR, 2018
This Article has been written by Shri Ravi Shekhar Jha, Advocate based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
The Madras High Court, in a significant judgment delivered on September 18, 2025, quashed an inquiry report issued by the Deputy Commissioner of Customs under Regulation 17 of the Customs Brokers Licensing Regulations, 2018 (CBLR, 2018). The case, titled M/s. Sea Queen Shipping Services Private Limited vs. β The Commissioner of Customs & Anr. β, was presided over by Honourable Justice. β
Background of the Case
The petitioner, M/s. Sea Queen Shipping Services Private Limited, challenged the inquiry report dated June 27, 2025, issued by the second respondent, the Deputy Commissioner of Customs. β The report alleged violations of Regulation 10(q) of the CBLR, 2018, and recommended further proceedings. β The petitioner contended that the report was illegal, arbitrary, and issued beyond the mandatory timeline prescribed under Regulation 17(5) of the CBLR, 2018. β
The case stemmed from an investigation into an importer, M/s. β Anomsoft Solutions Private Limited, which revealed discrepancies between the imported goods and the business activities mentioned in the GST numbers of the importer. β The petitioner, acting as the customs broker, filed the Bills of Entry for the importer. β Following the investigation, the Principal Commissioner of Customs suspended the petitioner’s customs broker license on December 21, 2024, under Regulation 16(1) of the CBLR, 2018. β Subsequent inquiry proceedings under Regulation 17 were initiated, leading to the issuance of a show-cause notice on January 17, 2025. β
Key Issues Raised
The petitioner raised two primary issues in the writ petition:
The inquiry report was submitted beyond the mandatory 90-day timeline prescribed under Regulation 17(5) of the CBLR, 2018, thereby vitiating the proceedings. β
The petitioner was not afforded an opportunity to cross-examine witnesses, violating the principles of natural justice as per Regulation 17(4) of the CBLR, 2018. β
Court’s Observations and Judgment
The Court examined the arguments presented by both parties and referred to multiple precedents, including judgments from the Madras High Court and the Delhi High Court. It reiterated that the 90-day timeline under Regulation 17(5) of the CBLR, 2018, is mandatory and not directory. The Court emphasized that exceeding this timeline results in the abatement of proceedings, as established by previous judicial pronouncements. β
The respondents argued that the delay in submitting the inquiry report was due to the petitioner’s repeated requests for time during the personal hearing. β However, the Court noted that the 90-day period had already expired by the time the first hearing was scheduled on April 28, 2025. β Therefore, any subsequent delays could not justify the violation of the mandatory timeline. β
The Court also addressed the issue of estoppel, stating that the petitioner’s participation in the proceedings does not negate the mandatory nature of the timeline under Regulation 17(5). β Furthermore, the Court found that the inquiry report was not communicated to the petitioner within the stipulated time, further violating the regulations. β
Conclusion
In its judgment, the Madras High Court allowed the writ petition and set aside the impugned inquiry report dated June 27, 2025. β The Court held that the proceedings stood abated due to the violation of the mandatory timeline under Regulation 17(5) of the CBLR, 2018. β The Court also deemed it unnecessary to address the second issue regarding the alleged violation of natural justice. β
This judgment underscores the importance of adhering to mandatory timelines in regulatory proceedings and reinforces the principle that procedural lapses can vitiate the entire process. β It serves as a reminder to authorities to strictly comply with statutory requirements to ensure fairness and transparency in administrative actions.
ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 10.12.2025
Madras High Court Quashes Service Tax Notifications and IGST on Ocean Freight as Ultra Vires
This Article has been written by Shri Ravi Shekhar Jha, Advocate based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
In a significant judgment dated October 13, 2025, the Madurai Bench of the Madras High Court, comprising Honourable Justice, delivered a landmark ruling in the cases W.P. β(MD) Nos. β 1139 & 1143 of 2021 and 14856 & 14857 of 2022. β The court declared certain service tax notifications and the imposition of Integrated Goods and Services Tax (IGST) on ocean freight as ultra vires, providing relief to the petitioners.
Background of the Case
The petitions were filed by M/s. TVS Srichakra Limited and M/s. β Hitech Arai Private Limited, challenging Notifications No. β 14/2017, 15/2017, and 16/2017 issued by the Union Ministry of Finance on April 13, 2017. β The petitioners argued that these notifications exceeded the scope of Section 68(2) of the Finance Act, 1994, and violated Articles 14, 19(1)(g), 245, and 269A of the Constitution of India. β Additionally, the petitioners sought to quash show-cause notices issued for the collection of service tax and IGST on ocean freight for the period between April 2017 and June 2017. β
Courtβs Observations
The court noted that similar challenges had been addressed by the Madras, Gujarat, and Bombay High Courts in previous cases, including:
M/s. Eastman Spinning Mills (P) Limited Vs. Union of India (Madras High Court, 2025) β
Sal Steels Limited Vs. Union of India (Gujarat High Court, 2020) β
Santhan Textile Private Limited Vs. Union of India (Bombay High Court, 2024) β
The Gujarat High Court, in the Sal Steels case, had struck down the impugned notifications, ruling that they were ultra vires Sections 64, 66B, 67, and 94 of the Finance Act, 1994. β The court held that the notifications lacked proper legal backing to impose service tax and IGST on ocean freight under CIF contracts. β Similarly, the Madras High Court in the Eastman Spinning Mills case followed the Gujarat High Court’s decision and quashed the notifications. β
Key Judgment
The Madurai Bench of the Madras High Court aligned with the earlier rulings and declared the impugned notifications as ultra vires. The court emphasized that the notifications failed to provide a proper mechanism under Section 68(2) of the Finance Act, 1994, to shift the burden of paying service tax and IGST on ocean freight to the petitioners, who were not the recipients of the taxable service. β Consequently, the court quashed the notifications and the related show-cause notices, granting relief to the petitioners. β
IGST on Freight
IGST on freight is applicable only when the importer directly pays the freight to the transporter, such as in FOB import contracts or domestic freight services. However, in CIF imports, where freight is included in the supplierβs invoice and paid by the foreign exporter, the importer is not liable to pay IGST under reverse charge. The Supreme Court in Union of India vs. Mohit Minerals (2022) declared the levy of IGST on ocean freight under RCM as unconstitutional and resulting in double taxation. Therefore, no IGST is payable on ocean freight in CIF imports as per the settled legal position.
Implications of the Judgment
This judgment is a significant development for businesses involved in import transactions under CIF contracts. β The ruling reinforces the position that service tax and IGST on ocean freight cannot be imposed without proper legal authority. β It also highlights the importance of adhering to constitutional provisions and ensuring that tax notifications do not exceed the scope of the enabling legislation. β
Conclusion
The Madurai High Courtβs decision is a welcome relief for businesses, as it sets a precedent for similar cases across the country. By declaring the service tax notifications and IGST on ocean freight as ultra vires, the court has upheld the principles of constitutional validity and provided clarity on the scope of taxation under the Finance Act, 1994. β This judgment is expected to have far-reaching implications for the interpretation of tax laws in India.
ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 17.11.2025
Madras High Court Quashes Customs Orders on Wheat Gluten Import Under DFIA
This Article has been written by Shri Ravi Shekhar Jha, Advocate based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
The Madras High Court, in a significant ruling on October 15, 2025, quashed multiple orders issued by the Additional Commissioner of Customs, Chennai II Commissionerate, regarding the import of Wheat Gluten under Duty-Free Import Authorisation (DFIA). The judgment, delivered by Honourable Justice, addressed a series of writ petitions filed by M/s. Parry Enterprises India Limited and M/s. β Fame Shipping Agency, challenging the orders that denied duty exemption on imported Wheat Gluten.
Background of the Case
M/s. Parry Enterprises India Limited, engaged in importing and trading Wheat Gluten, and its licensed Custom Broker, M/s. β Fame Shipping Agency, filed writ petitions against the Additional Commissioner of Customs. β The dispute arose when the petitioners imported Wheat Gluten under DFIA, claiming exemption from customs duty as per a notification dated September 11, 2009. β The DFIA was issued for the export of biscuits, and the petitioners argued that Wheat Gluten qualifies as Wheat Flour under the same classification.
The Customs Department, however, contended that Wheat Gluten is not covered under the DFIA license, which only allows the import of Wheat Flour. β Consequently, the Department issued show-cause notices, demanding duty, cess, and penalties, and sought to confiscate the imported goods. β
Petitionersβ Argument
The petitioners argued that the issue of whether Wheat Gluten qualifies as Wheat Flour had already been settled by the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) in multiple cases, including Uni Colloids Impex Pvt Ltd. vs. Commissioner of Customs (2014) and Unibourne Food Ingredients LLP vs. Commissioner of Customs, Mundra (2022). β In these cases, CESTAT had consistently held that Wheat Gluten is classified as Wheat Flour with specific technical characteristics and is eligible for duty exemption under DFIA. β
The petitioners contended that the Customs Department was bound by the decisions of CESTAT and could not take an independent view contrary to the established precedent. β
Respondentβs Stand
The Customs Department argued that the petitioners were not entitled to the exemption as Wheat Gluten was not covered under the DFIA license. β They further stated that the Department had not appealed against the CESTAT decisions due to monetary limits, but this did not preclude them from raising the issue in other cases. β The Department also argued that the petitioners had an alternative remedy of appeal and questioned the maintainability of the writ petitions. β
High Courtβs Observations and Judgment
Justice rejected the Customs Departmentβs arguments and emphasized the importance of judicial discipline. The Court held that the Customs Department is bound by the decisions of higher appellate authorities, such as CESTAT, unless those decisions are overturned by a competent court. β The Court referred to the Supreme Courtβs judgment in Union of India vs. Kamlakshi Finance Corporation Ltd. (1991), which established that revenue officers must follow the orders of appellate authorities unreservedly. β
The Court also dismissed the argument regarding the maintainability of the writ petitions, stating that the bar on entertaining writ petitions due to alternative remedies is not absolute, especially when the jurisdiction of the authority passing the orders is challenged. β
Key Takeaways from the Judgment
Binding Nature of CESTAT Decisions: The Court reiterated that decisions of appellate authorities like CESTAT are binding on assessing officers unless overturned by a higher court. β
Judicial Discipline: The judgment emphasized the importance of judicial discipline in ensuring consistency and fairness in the administration of tax laws. β
Writ Petition Maintainability: The Court clarified that the availability of an alternative remedy does not bar the High Court from exercising its jurisdiction under Article 226 of the Constitution, particularly when the authorityβs jurisdiction is in question. β
Wheat Gluten Classification: The Court upheld CESTATβs consistent stance that Wheat Gluten falls under the same classification as Wheat Flour and is eligible for duty exemption under DFIA.
Conclusion
This landmark judgment by the Madras High Court is a significant win for importers and exporters, as it reinforces the binding nature of CESTAT decisions and provides clarity on the classification of Wheat Gluten under DFIA. The ruling also underscores the judiciaryβs role in ensuring that administrative authorities adhere to established legal precedents, thereby preventing undue harassment of businesses and ensuring consistency in the application of tax laws.
ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 01.11.2025
Understanding the Legal Landscape of Importing Second-Hand Digital Multifunction Devices in India
This Article has been written by Shri Ravi Shekhar Jha, Advocate based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
The importation of second-hand Digital Multifunction Devices (MFDs) has been a contentious issue in India, with various legal and regulatory challenges faced by importers. β Recent judgments from the High Court of Madras and the Supreme Court of India have provided clarity on the matter, particularly regarding the provisional release of these goods under Section 110A of the Customs Act, 1962. β
The Background
MFDs, which are highly specialized equipment used for printing, copying, and scanning, have been subject to scrutiny by the Customs Department. β The primary concerns revolve around their categorization under import/export regulations, which classify items as prohibited, restricted, or freely importable. β While importers argue that MFDs are freely importable, the Customs Department and other government bodies, such as the Ministry of Electronics and Information Technology (MEITY) and the Ministry of Environment, Forest and Climate Change (MoEFCC), have raised objections, claiming that these goods are restricted or prohibited.
Key Legal Developments
Provisional Release Under Section 110A of the Customs Act β
Section 110A allows for the provisional release of seized goods during investigation or adjudication. β This provision aims to prevent financial losses and operational delays for importers while ensuring that the Customs Department can continue its investigation. β Importers are required to execute a bond or provide a bank guarantee to cover potential duties, fines, or penalties. β
Madras High Court Judgments β
In a landmark judgment dated 10th July 2025 (WP No. 29418 of 2024), the Madras High Court ruled in favor of importers, stating that MFDs qualify as Highly Specialized Equipment (HSE) under Clause 8 of the Compulsory Registration Order (CRO), 2021. The court emphasized that MFDs weighing more than 80 kg and imported in less than 100 units per model per year are exempt from the application of CRO, 2021. β The court also clarified that the Hazardous and Other Wastes (Management and Transboundary Movement) Rules, 2016, do not prohibit the import of MFDs, provided the required documents are submitted to the Customs Authorities.
Tanish Enterprises vs Commissioner of Customs– WP No. 29418 of 2024
The case involves importers seeking provisional release of second-hand digital multifunction devices (MFDs) detained by the Customs Department, which claimed the goods were restricted or prohibited. β The petitioners argued that MFDs are freely importable as Highly Specialized Equipment (HSE) under the Compulsory Registration Order (CRO), 2021, and Foreign Trade Policy (FTP), 2023. The court ruled in favor of the petitioners, directing the Customs Department to provisionally release the goods under Section 110A of the Customs Act, 1962, subject to conditions, while leaving the final adjudication open. β
Key Points:
Issue: Whether second-hand MFDs are freely importable or restricted items requiring BIS certification and DGFT authorization. β
Petitioners’ Claim: MFDs qualify as Highly Specialized Equipment (HSE) and are exempt from restrictions under CRO, 2021, and FTP, 2023. β
Respondents’ Claim: MFDs are restricted or prohibited items requiring compliance with BIS, DGFT, and environmental regulations. β
Court’s Ruling: Directed provisional release of MFDs under Section 110A of the Customs Act, subject to conditions, and left final adjudication open. β
Precedents: Previous rulings by the Madras High Court, Telangana High Court, and Supreme Court upheld the free importability of MFDs. β
Provisional Release: Allows importers to access goods while investigations continue, preventing financial losses due to detention. β
βHD Printers vs Commissioner of Customs- Writ Petition No.39010 of 2025 and W.M.P.No.43694 of 2025
The case involves M/s. HD Printers, represented by its proprietor Mr. Jagan Kumar, filing a writ petition under Article 226 of the Constitution of India. The petitioner sought a Writ of Mandamus directing the Customs Department to allow the provisional release of 120 units of second-hand digital multifunction print and copying machines. β These machines were imported and submitted for clearance with the required documentation, including a report from a DGFT-approved Chartered Engineer. β The Customs Department had initially refused to release the goods, citing restrictions under the Hazardous and Other Wastes (Management and Transboundary Movement) Rules, 2016 (HOW Rules). β However, the court referred to a previous judgment (W.P.No.29418 of 2024) and ruled that the case was covered under the earlier order, which allowed provisional release of similar goods. β The court directed the Customs Department to release the goods provisionally, subject to conditions and final adjudication. β
Key Points:
Petitioner: M/s. HD Printers. β
Respondents: Commissioner, Additional Commissioner, and Deputy Commissioner of Customs, Chennai. β
Issue: Provisional release of 120 second-hand digital multifunction print and copying machines. β
Legal Basis: Article 226 of the Constitution of India and Section 110A of the Customs Act, 1962. β
Customs Department’s Argument: Machines classified as “other wastes” under HOW Rules, 2016, requiring prior permission for import. β
Court’s Decision: Directed provisional release of goods within four weeks, subject to conditions and final adjudication.
Reference Case: W.P.No.29418 of 2024, which allowed provisional release of similar goods.
Provisional Release Conditions: Execution of a simple bond for 100% of the enhanced value and payment of applicable GST.
Final Adjudication: Customs Department retains the right to reverse the provisional release order during final adjudication. β
Maruti Enterprises vs Commissioner of Customs- WP No. 35987 of 2025
The case involves M/s. Maruti Enterprises, represented by its proprietor Gautam Sharma, filing a writ petition under Article 226 of the Constitution of India for the issuance of a writ of mandamus. β The petitioner seeks the provisional release of two consignments of second-hand digital multifunction print and copying machines (MFDs) imported by them. β The petitioner claims that the goods were examined by a DGFT-approved Chartered Engineer, who provided a report to the Customs Officer. β Despite this, the Customs Department proceeded to forfeit the goods. β The petitioner argues that the issue is covered by a previous order of the Madras High Court, which allowed the provisional release of similar goods under Section 110A of the Customs Act, 1962.
The court referred to the earlier judgment, which clarified that MFDs are not prohibited items under the Hazardous and Other Wastes (Management and Transboundary Movement) Rules, 2016, and are freely importable. β The court directed the Customs Department to grant provisional release of the goods within four weeks, subject to conditions as per the Customs Act, 1962. β The provisional release is subject to final adjudication, and the Customs Department retains the authority to reverse the provisional release order during the final adjudication process. β
Key Points:
Petitioner: M/s. Maruti Enterprises. β
Respondents: Commissioner, Additional Commissioner, and Deputy Commissioner of Customs, Chennai. β
Issue: Provisional release of two consignments of second-hand digital multifunction print and copying machines. β
Legal Basis: Section 110A of the Customs Act, 1962, and Article 226 of the Constitution of India. β
Court’s Reference: Previous Madras High Court order in WP No. β 29418 of 2024, which allowed provisional release of similar goods.
Court’s Decision: Directed the Customs Department to grant provisional release within four weeks, subject to conditions under the Customs Act, 1962. β
Provisional Release Conditions: Subject to final adjudication, and the Customs Department may reverse the provisional release order during the final adjudication process. β
No Costs: The court disposed of the writ petition without imposing any costs. β
Supreme Court Endorsement β
The Supreme Court upheld the decision of the Telangana High Court, which had granted provisional release of MFDs under similar circumstances. β This decision reinforced the stance that MFDs are freely importable and eligible for provisional release. β
Atul Commodities Pvt. Ltd. & Ors. vs Commissioner of Customs- Civil Appeal Nos. 5259/2007, 3226/2007 and 3977/2007
The case revolves around whether second-hand photocopying machines imported by M/s Atul Commodities Pvt. β Ltd. in January 2005 were “freely importable” as capital goods under the Foreign Trade Policy (FTP) 2004-09 or required a license for import. β The Kerala High Court had ruled that such imports required a license, relying on policy circulars issued by the Directorate General of Foreign Trade (DGFT). β However, the Supreme Court held that the DGFT circulars were clarificatory and not amendatory, and only the Central Government had the authority to amend the FTP under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992. β The Court ruled that second-hand photocopying machines were “capital goods” and were freely importable under the FTP 2004-09. β The Supreme Court allowed the appeal of M/s Atul Commodities Pvt. Ltd. and dismissed the appeals filed by the Department. β
Key Points:
Issue: Whether second-hand photocopying machines imported in January 2005 were freely importable as “capital goods” or required a license under the FTP 2004-09. β
High Court Decision: Kerala High Court ruled that the imports required a license, relying on DGFT circulars.
Supreme Court Decision: The Supreme Court held that DGFT circulars were clarificatory, not amendatory, and only the Central Government could amend the FTP under Section 5 of the Foreign Trade Act, 1992. β
Outcome: The Supreme Court ruled that second-hand photocopying machines were “capital goods” and were freely importable under FTP 2004-09. β The judgment of the Kerala High Court was set aside, and the Tribunal’s decision favoring M/s Atul Commodities Pvt. β Ltd. was restored.
Final Verdict: M/s Atul Commodities Pvt. β Ltd. won the case, and the Department’s appeals were dismissed. β
Recent Judgments
Subsequent cases, such as WP No. β 39010 of 2025 and WP No. 35987 of 2025, have followed the precedent set by the Madras High Court and the Supreme Court. These judgments have consistently directed the Customs Department to grant provisional release of MFDs, subject to conditions such as the execution of a bond and payment of applicable GST.
Notification on Special Economic Zones (Fourth Amendment) Rules, 2024 β
The document is a notification issued by the Ministry of Commerce and Industry, Department of Commerce, dated June 20, 2024. β It announces the Special Economic Zones (Fourth Amendment) Rules, 2024, which amend the Special Economic Zones Rules, 2006. β The amendments focus on rule 18, sub-rule (4), clause (d), specifically modifying the provisions related to reconditioning, repair, and re-engineering activities within Special Economic Zones (SEZs). β
Key changes include:
Reconditioning, repair, and re-engineering are permitted under the condition that exports must have a one-to-one correlation with imports, and all processed products must be exported. β
Non-hazardous metal and metal-alloy wastes generated from these activities may be sold in the Domestic Tariff Area (DTA) under certain conditions:
The waste must be in metallic, non-dispersible form without contaminants listed under Basel No. β B1010 in Part D of Schedule III of the Hazardous and Other Wastes Rules, 2016. β
Sale in the DTA is subject to payment of applicable customs duty and treated as import. β
Such sales are allowed only to actual users or traders authorized by the State Pollution Control Board on a one-time basis. β
Verification of specified documents by Customs Authority is required. β
The rules come into effect upon publication in the Official Gazette. β The notification also references previous amendments to the principal rules, last updated on June 6, 2024. β
Key Takeaways for Importers
Provisional Release: Importers can seek provisional release of detained goods under Section 110A of the Customs Act, provided they fulfill the conditions set by the Customs Department. β
Exemption Criteria: MFDs that meet the criteria for HSE under Clause 8 of CRO, 2021, are exempt from the application of the order. β Importers must ensure their goods weigh more than 80 kg and are imported in less than 100 units per model per year. β
Compliance with HOW Rules: Importers must submit the required documents as per Schedule VIII of the HOW Rules to the Customs Authorities at the time of import. β
Final Adjudication: Provisional release does not guarantee the final outcome. β The Customs Department retains the authority to reverse the provisional release order during final adjudication. β
Conclusion
The legal clarity provided by the courts is a significant relief for importers of second-hand MFDs. β However, it is crucial for importers to ensure compliance with all regulatory requirements and maintain proper documentation to avoid complications during the import process. As the legal landscape continues to evolve, staying updated on relevant judgments and notifications is essential for smooth business operations.
ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 09.10.2025
Extended Timeline for enforcement of BIS for MSME Domestics Manufacturer will also apply on Imports by MSME says Madras High Court
This Article has been written by Shri Ravi Shekhar Jha, Advocate based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
The Madras High Court, in a significant ruling on September 25, 2025, disposed of a writ petition filed by M/s. β Alankar Shipping and Trading Co. P. Ltd, directing the Customs Department to assess and clear imported goods without insisting on a Bureau of Indian Standards (BIS) Registration Certificate. The judgment, delivered by Honourable Justice, brought clarity to the applicability of the Plywood and Wooden Flush Door Shutters (Quality Control) Order, 2024, particularly concerning imports by Micro, Small, and Medium Enterprises (MSMEs).
Background of the Case
The petitioner, M/s. Alankar Shipping and Trading Co. P. Ltd, represented by its Managing Director, had imported 3,456 sheets of packing plywood from Vietnam, valued at USD 24,896.96. β The goods arrived at Chennai on August 13, 2025, under a bill of lading dated July 29, 2025. β The petitioner filed a writ petition under Article 226 of the Constitution of India, seeking a Writ of Mandamus to direct the Customs Department to assess and clear the goods covered under Bill of Entry No. β 3836297 dated August 12, 2025, without requiring a BIS Registration Certificate. β
The petitioner argued that the Quality Control Order (QCO), which mandates the use of standard marks, came into force on February 28, 2025, but its provisions were postponed until August 28, 2025. β As a recognized Micro Enterprise under the MSME classification, the petitioner claimed exemption from the BIS requirement until the postponed date. β However, the Customs Department refused to grant this exemption, citing a communication from the Ministry of Commerce and Industry dated March 19, 2025, which stated that the additional time period for compliance granted to MSMEs does not apply to imports.
ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 29.09.2025
Madras High Court Grants Provisional Release of Imported Goods
This Article has been written by Shri Ravi Shekhar Jha, Advocate based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
The Madurai Bench of the Madras High Court, presided over by Honourable Justice, has delivered a significant order in the case of M/s. β Genuine Spices vs. β The Commissioner of Customs & Others. β The case revolved around the import of goods classified as roasted areca nuts, which were detained by customs authorities on grounds of alleged misdeclaration. β
Background of the Case
M/s. Genuine Spices, represented by its proprietor, had imported goods under Bill of Entry No. β 4225311 dated June 28, 2024. β The customs authorities refused to clear the goods, claiming that they did not fall under the classification of roasted areca nuts. β The petitioner, however, maintained that the goods were indeed roasted areca nuts and challenged the show cause notice issued by the respondents. β The petitioner also highlighted the perishable nature of the goods and sought relief from the court to prevent their disposal by customs authorities.
ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 20.09.2025
Case Compilation on Indian Customs Law- Pro Industry cases
A Comprehensive compilation of Pro-Industry decided cases based upon CESTAT Tribunal, Supreme Court, and various High Court Decisions
Prepared for Legal Professionals, Importers, Exporters, Customs Brokers, Freight Forwarders, and Industry Stakeholders.
The document is designed with users in mind:
– Legal Professionals and Advocates: to strengthen arguments, identify precedents, and analyze emerging jurisprudential trends.
– Importers and Exporters: to understand compliance obligations, permissible reliefs, and potential liabilities in customs operations.
– Customs House Agents and Freight Forwarders: to better appreciate their responsibilities, liabilities, and avenues for defense in proceedings.
– Industry Stakeholders and Policy Analysts: to observe how judicial interpretation influences trade policy, customs procedures, and dispute resolution frameworks.
The compilation thus stands as a practical handbook for trade compliance, litigation strategy, and informed decision-making.
Link has been provided for Readers/Users for the source Judicial Orders, which directly opens the source PDF document.
This Case Compilation has been written by Shri Ravi Shekhar Jha, Advocate based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
Sources Referred: CESTAT, Supreme Court, Delhi High Court, Madras High Court, Bombay High Court, High Court of Kerala, High Court of Punjab and Haryana
