Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 21.10.2026
Bombay HC: DGFT Cannot Retrospectively Apply Import Restrictions to Goods Shipped Before Notification
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Bombay High Court has held that an import restriction cannot be applied to goods that were dispatched and had arrived in India before the restriction was published in the Official Gazette, even where the bills of entry were filed later.
The dispute: a change from βFreeβ to βRestrictedβ
In Heimerle Refinery Private Limited v. Union of India & Ors., the petitioner imported studded platinum jewellery under five airway bills dated 30 and 31 March 2026. The consignments reached India on 1 and 2 April 2026.
The Directorate General of Foreign Trade (DGFT) had issued Notification No. 02/2026-27, dated 1 April 2026, changing the import policy for goods under Customs Tariff Heading 7113 from βFreeβ to βRestricted.β However, the notification was uploaded to the e-Official Gazette only on 2 April 2026 at approximately 8:52 p.m.
Customs authorities declined clearance of certain consignments because the related bills of entry were filed after publication of the notification. The importer challenged this approach, arguing that the relevant import date under the Foreign Trade Policy was the date of shipment or dispatch, not the later date of filing or clearance of the bill of entry.
The central legal issue
The case turned on a narrow but important question: which date governs the applicability of an import-policy restriction under the Foreign Trade Policy?
The authorities argued that goods not cleared for home consumption before the restriction came into force were subject to the revised βRestrictedβ policy. They relied on customs-law principles that treat clearance across the customs barrier as significant for determining the applicable rate of duty.
The Court rejected that approach for this dispute. It distinguished between:
Customs duty issues, where the Customs Act may make the date of filing a bill of entry or clearance relevant; and
Import-policy restrictions under the Foreign Trade Policy, where the policy itself defines the date of import differently.
Why the Court ruled for the importer
The Court relied on paragraph 1.05(b) of the Foreign Trade Policy 2023, read with paragraphs 2.17(a) and 11.11 of the Handbook of Procedures. These provisions make the date of shipment or dispatch from the supplying country the relevant date for determining importability under the policy.
For imports by air, paragraph 11.11 treats the relevant date as the date on the airway bill, provided it reflects when the goods left the last airport in the exporting country.
Because the jewellery had been dispatched on 30 and 31 March 2026 and had arrived in India before the e-Gazette publication on 2 April 2026, the Court found that the later restriction could not apply to those consignments.
The Court also emphasized that a notification gains legal force only upon publication in the Official Gazette. In the context of an e-Gazette, the specific upload time matters. The notification therefore could not operate retrospectively against goods already dispatched and imported before that publication.
Customs clearance date was not decisive
A key part of the judgment is its clarification that filing a bill of entry after a policy change does not, by itself, make the new import restriction applicable.
The Court held that the date of filing a bill of entry is relevant to the rate of customs duty under Section 15 of the Customs Act. But the case did not concern a change in duty rate or valuation. It concerned a change in import policy under the Foreign Trade (Development and Regulation) Act and the Foreign Trade Policy.
Applying customs-duty timing rules to a policy restriction, the Court said, would make the Foreign Trade Policyβs own definition of the date of import redundant.
DGFT clarification could not override the policy
The DGFT had issued an Office Memorandum on 13 May 2026 stating that consignments not cleared before 1 April 2026 would be governed by the revised restricted policy, regardless of their arrival date or bill-of-entry status.
The Court held that this executive clarification had no statutory force and could not override the Foreign Trade Policy or alter its definition of the date of import. It also could not retrospectively expand the notificationβs effect.
In the Courtβs view, changing the policy in that manner would require an amendment made through the legally prescribed statutory process, not an administrative memorandum.
The outcome
The Bombay High Court allowed the writ petition and directed the authorities to release the consignments covered by Bills of Entry Nos. 8590663, 8590666 and 8735308. It declared that Notification No. 02/2026-27 did not apply to goods that had arrived in India before its publication in the e-Official Gazette on 2 April 2026.
The ruling aligns with earlier decisions of the Gujarat High Court in Enero Jewels and the Delhi High Court in Bright Metal Refiners, both of which had permitted clearance of goods imported before publication of a similar restriction despite post-notification bills of entry.
Practical significance for importers
This decision draws a clear line between the timing rules for customs duty and those for import-policy restrictions. Where the Foreign Trade Policy defines the date of import by shipment or dispatch, importers may rely on the airway bill or other prescribed transport document to establish that the goods were imported before a later policy restriction became legally effective.
For goods transported by air, the airway bill date can therefore be critical evidence. The judgment also reinforces that an e-Gazette notification takes effect at the time it is actually published online, not merely on the date printed on the notification.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 21.10.2026
Delhi HC: Common Words in Earlier Registered Marks Do Not Automatically Bar New Trademark Applications
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Delhi High Court has set aside the Trade Marks Registryβs refusal to register βPlanet E Schoolβ for educational services, holding that the mark must be assessed as a whole rather than rejected merely because it contains common words such as βPlanet,β βE,β and βSchool.β
Background of the dispute
Grey Matters Educational Trust applied to register βPlanet E Schoolβ in Class 41 for educational services. The Trade Marks Registry refused the application on 25 January 2019, citing Sections 9 and 11 of the Trade Marks Act, 1999.
Section 9 bars marks that lack distinctiveness, while Section 11 addresses marks that may conflict with earlier trademarks and create a likelihood of confusion. The Registryβs order, however, stated only that the application was objectionable under these provisions, without providing detailed reasons or dealing with the applicantβs response to the examination report.
Grey Matters Educational Trust appealed to the Delhi High Court under Section 91 of the Act. It argued that its mark was visually, structurally and phonetically different from the cited marks, and that the phrase βPlanet E Schoolβ had to be considered in its full commercial form.
Court rejects a fragmented comparison of trademarks
The Court found that the cited registrations and the applied-for mark shared elements such as βPlanetβ and βE.β But that commonality alone was not enough to establish deceptive similarity.
The Court applied the anti-dissection rule, a central principle of trademark law. Under this rule, a composite trademark must be evaluated in its entirety. Courts should not split a mark into individual words or components and compare those isolated pieces with portions of another mark.
The relevant question is the overall impression created for an ordinary consumer. In this case, the Court held that the cited marks, when viewed as whole marks, were not prima facie similar or deceptively similar to βPlanet E School.β The Section 11 objection was therefore found to lack merit.
Generic words can form a distinctive combination
The Court also addressed the distinctiveness objection under Section 9. It accepted that βPlanet,β βE,β and βSchool,β viewed individually, are generic or commonly used expressions. Yet it held that their combination in the phrase βPlanet E Schoolβ creates a distinctive and unique commercial identity.
This distinction is important for trademark applicants. A mark does not necessarily fail because some or all of its individual elements are descriptive, ordinary or generic. The legal assessment must focus on whether the combination, taken as a whole, can distinguish one partyβs services from those of others.
The Registryβs one-line refusal was inadequate
A significant feature of the judgment is the Courtβs criticism of the refusal order itself. The Registry had issued a one-line rejection without explaining how the mark failed under Sections 9 and 11. It also did not address the detailed reply filed by the applicant in response to the First Examination Report.
The decision reinforces that trademark refusals must be reasoned. Where an applicant has placed substantive arguments on record, the Registry must engage with those arguments rather than issue a conclusory order.
Conditions attached to the registration process
Although the Court allowed the appeal, it imposed two important qualifications:
No exclusive right over βPlanetβ alone: Grey Matters Educational Trust cannot claim exclusive rights in the standalone word βPlanet.β
Punjab-only territorial restriction: Use of the βPlanet E Schoolβ mark is restricted to the State of Punjab.
The Court directed the Trade Marks Registry to process the application and advertise the mark under the Trade Marks Act and Trade Marks Rules. Any opposition filed during the advertisement process must be decided on its own merits.
Why the decision matters
The ruling provides useful guidance for businesses, schools and brand owners seeking protection for composite marks:
A shared word does not automatically make two marks deceptively similar.
Composite marks should be judged by their overall visual, phonetic and structural impression.
Generic or common terms may still be registrable when their combination creates distinctiveness.
Trademark authorities must provide reasons and consider an applicantβs substantive response before refusing registration.
In allowing the appeal, the Delhi High Court reaffirmed that trademark examination is not a word-by-word exercise: the decisive issue is the complete commercial impression a mark creates in the marketplace.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 21.10.2026
Supreme Court Sets Aside NDPS Conviction Over Search Safeguard and Confession Issues
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Supreme Court acquitted Nirmal Singh Pehlwan after finding that the mandatory safeguard under Section 50 of the Narcotic Drugs and Psychotropic Substances Act, 1985 was not properly followed and that reliance on his Customs confession was legally unsound.
Background of the case
On 4 January 1999, a joint team of Customs, Punjab Police and CIA staff set up a checkpoint near Saki Bridge, Ajnala. Officials stopped a Maruti car carrying three people. According to the prosecution, two occupants fled in dense fog while Nirmal Singh Pehlwan, also known as Nimma, was apprehended.
Customs officials alleged that two one-kilogram packets of brown powder were found in his lap. Field testing and later laboratory analysis identified the substance as heroin. During the investigation, the accused also made a statement under Section 108 of the Customs Act admitting guilt.
The Trial Court convicted him under Section 22 of the NDPS Act and imposed 10 yearsβ rigorous imprisonment, a fine of Rs. 1 lakh, and a further two yearsβ imprisonment in default of payment. The High Court upheld that result.
Core legal issue: Was the accused informed of his Section 50 right?
Section 50 of the NDPS Act protects a person facing a personal search. Before conducting that search, the authorised officer must inform the person that they have a right to be searched before a Magistrate or a Gazetted Officer.
In this case, the prosecution relied on a consent memo stating that Nirmal Singh chose to be searched in the presence of a Gazetted Officer. The Supreme Court held that merely presenting a choice between a Magistrate and a Gazetted Officer was not enough. The officer had to clearly communicate that this was the suspectβs legal right.
The Court noted that the Customs officer did not state in his evidence that he had informed the accused of this right. He only obtained an option recorded in the consent memo. Applying the Constitution Bench ruling in Vijaysinh Chandubha Jadeja, the Court found complete non-compliance with Section 50.
Why the defect mattered
The Court reaffirmed that Section 50 is mandatory where recovery is made from a personβs body or personal possession. Its purpose is to:
prevent misuse of search powers;
protect innocent persons from false implication; and
reduce allegations that contraband was planted.
A defective Section 50 procedure makes the alleged recovery suspect. Where the conviction depends on that recovery, the defect can invalidate the conviction.
Customs confession also could not sustain the conviction
The prosecution had also relied on the accusedβs confession made to a Customs officer under Section 108 of the Customs Act. The Supreme Court preferred the reasoning in Noor Aga v. State of Punjab, which examined the investigative and prosecutorial powers exercised by Customs officers in narcotics matters.
The Court concluded that such a confession could not be treated as admissible simply because it was made to a Customs officer rather than a conventional police officer. It found that the earlier decision relied on by the prosecution had not fully considered the protections embodied in Section 25 of the Indian Evidence Act.
Supreme Courtβs ruling
Because the mandatory Section 50 safeguard was not complied with and the confession could not reliably support the prosecution, the Supreme Court set aside the conviction and acquitted Nirmal Singh Pehlwan.
Key legal takeaway
An NDPS personal search cannot be validated by a signed consent memo alone. Officers must clearly inform the suspect of the statutory right to be searched before a Magistrate or Gazetted Officer; failure to do so can undermine the recovery and overturn a conviction.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 19.10.2026
Himachal Pradesh HC: Rigours of Section 37 NDPS Act Inapplicable Where Heroin Recovery Is Below Commercial Quantity
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Himachal Pradesh High Court has granted regular bail to Prince Rana and Sudhanshu Soni in an NDPS case involving the recovery of 32.56 grams of heroin, while making clear that the order does not decide their guilt or innocence.
The case at a glance
Justice Rakesh Kainthla decided the connected bail petitions on 16 October 2026. The petitions arose from FIR No. 28 of 2026, registered at Baijnath Police Station in Kangra district under Sections 21, 25 and 29 of the Narcotic Drugs and Psychotropic Substances Act, 1985.
According to the prosecution, police received information on 24 February 2026 that Prince Rana, Sudhanshu Soni and others were selling heroin from a house in Village Malehad. Officers recorded and forwarded the information to a superior officer before conducting a search. The search reportedly led to the recovery of a polythene packet containing 32.56 grams of heroin, concealed beneath a sofa-cum-bed.
The prosecution said both petitioners were present at the house when the recovery was made. It also relied on statements allegedly made during the investigation concerning the procurement and delivery of the substance. A forensic report confirmed that the recovered material was diacetylmorphine, commonly known as heroin.
Arguments before the Court
The petitioners denied the allegations and said they had been falsely implicated. Their counsel stressed that they were first-time accused, had no other FIRs registered against them, and that the police investigation had already concluded. The charge sheet had been filed on 24 April 2026, meaning further custodial interrogation was not required, they argued.
The State opposed bail, contending that the allegations concerned heroin sales and that the offence had serious consequences for society. It urged the Court not to show leniency.
Why the High Court granted bail
The Court considered established Supreme Court principles on bail, including the nature and gravity of the accusation, the evidence available at the preliminary stage, the possibility of absconding, the likelihood of witness interference, criminal antecedents and the need to protect the trial process.
While the Court found that the petitionersβ presence at the house during the alleged recovery created a prima facie case, it identified several factors favouring release:
Quantity below the commercial threshold: The Court noted that the alleged recovery was less than a commercial quantity. Therefore, the stricter restrictions on bail under Section 37 of the NDPS Act were not applicable.
No stated criminal history: The petitionersβ assertion that they were first offenders was not disputed by the State in its status report. The Court observed that first offenders should have an opportunity for reform and that unnecessary continued detention could expose them to hardened criminals.
Local roots: Both petitioners were stated to be permanent residents of Kangra district. As this was not disputed, the Court found no substantial risk of absconding.
Investigation complete: Since the police had completed the investigation and filed the charge sheet, and did not claim that custodial interrogation remained necessary, the Court held that continued detention would serve no useful purpose.
The decision reflects the general bail principle that personal liberty should ordinarily be protected unless circumstances indicate a real risk of flight, interference with justice, witness intimidation or repetition of offences.
Bail terms imposed
Prince Rana and Sudhanshu Soni were each directed to furnish a bail bond of βΉ1,00,000 with one surety in the same amount, to the satisfaction of the trial court. Their release is subject to conditions intended to safeguard the proceedings:
They must not intimidate witnesses or influence evidence.
They must attend every hearing and avoid seeking unnecessary adjournments.
They cannot leave their present address for more than seven continuous days without providing details of the intended visit to the concerned SHO, police station and trial court.
They must surrender any passports to the court.
They must provide their mobile numbers and social-media contact details to the police and court, comply with notices sent through SMS, WhatsApp or social-media accounts, and report any change in these details within five days.
The Court also stated that the prosecution may seek cancellation of bail if any condition is violated.
What the order doesβand does notβdecide
This is a bail ruling, not a final verdict in the criminal case. The High Court expressly stated that its observations were limited to deciding the bail applications and would not affect the merits of the prosecution at trial.
The trial court will determine the allegations based on the evidence presented during the proceedings.
The ruling shows that, even in narcotics cases, courts assess bail on the specific facts: the statutory quantity involved, the accusedβs prior record, their connection to the local community, the status of the investigation and the safeguards available to protect a fair trial.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 19.10.2026
Delhi HC: Composite Trademarks Must Be Evaluated as a Whole Under Section 11(1) of Trade Marks Act
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Delhi High Court has set aside the Trade Marks Registryβs refusal to register the word mark βKAMA CASAβ, holding that the Registry wrongly split the composite mark into separate elements and compared them with distinct earlier device marks.
Background of the dispute
Modi Woodspace Private Limited applied on 29 August 2023 to register KAMA CASA as a proposed-to-be-used word mark in Classes 20 and 35. The Trade Marks Registry objected under Section 11(1) of the Trade Marks Act, 1999, which concerns the likelihood of confusion with earlier trademarks.
After hearings, the Registrar refused the application on 21 May 2025. The refusal was based on earlier Class 20 registrations containing the terms βKAMAβ and βCASA.β The Registrar concluded that combining those words in βKAMA CASAβ could confuse consumers and traders about the commercial origin of the goods.
Modi Woodspace appealed to the Delhi High Court under Section 91 of the Act.
The key issue: Can a composite mark be broken into parts?
The central issue was whether the Registrar could assess the applicantβs mark by isolating the words βKAMAβ and βCASAβ and comparing each part separately with different prior marks.
The Court held that this approach was incorrect. It applied the anti-dissection rule, a settled trademark principle requiring a mark to be assessed as a whole rather than broken into individual components.
According to the Court, KAMA CASA is a composite word mark and should have been evaluated in its entirety. The cited prior marks were device or label marks with their own visual and design elements. The Registry could not disregard those elements, extract the words βKAMAβ and βCASA,β and use them separately to reject the composite word mark.
Why the refusal was flawed
The Court identified two material distinctions:
Different mark types: The applicant sought registration of a word mark, while the cited marks were device marks.
Improper comparison: The cited device marks could not be reduced to their word elements alone. Their overall visual presentation and device features formed part of the registered marks.
The Court found it difficult to understand how the Registrar could conclude that the composite word mark βKAMA CASAβ was deceptively similar to separate device marks containing βKAMAβ and βCASA,β particularly when each cited mark had distinctive device elements.
It further observed that the mere fact that the marks fell in the same class did not establish similarity or a likelihood of confusion.
Relevance of other βCASAβ registrations
During the appeal, Modi Woodspace submitted a Trade Marks Registry search report showing numerous registrations containing the word βCASAβ in the same or similar classes. Although this report had not been submitted to the Registrar during the original examination process, the Court considered it relevant.
The presence of multiple registered marks containing βCASAβ may be important when evaluating whether that word, in the relevant market context, can by itself justify refusal of a later composite mark. The Court therefore directed the Registrar to consider the search report in the renewed examination.
Courtβs decision
In its judgment delivered on 22 April 2026, the Delhi High Court:
quashed the refusal order dated 21 May 2025;
revived trademark application No. 6087367 for KAMA CASA;
remitted the application to the Registrar of Trade Marks for a fresh, de novo consideration; and
required the Registrar to complete that reconsideration within four months.
The Court clarified that its observations were made for the purpose of remand and should not be treated as a final finding that the mark must be registered.
Significance for trademark applicants
The ruling reinforces that trademark similarity assessments must be based on the overall commercial impression of competing marks. A registry or court should not artificially dissect a composite mark and assemble objections from separate earlier registrations unless the law and the facts justify that conclusion.
For applicants, the decision also highlights the value of submitting marketplace and registry search evidence early. Evidence of numerous similar registrations may help place a disputed word or element in context, especially where the applicantβs mark combines common or widely used terms into a distinct overall expression.
Ultimately, the case confirms that a Section 11(1) objection requires a careful comparison of the marks as consumers encounter them, not an isolated comparison of selected words taken out of their full visual and commercial context.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 19.10.2026
Madras HC: Non-Parent Customs Commissioner Cannot Suspend Customs Broker Licence Under Regulation 16 of CBLR 2018
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Madurai Bench of the Madras High Court has held that only the Customs authority that issued a Customs Brokerβs licenceβthe βParent Commissionerateββmay suspend it under the Customs Brokers Licensing Regulations, 2018.
In M/s. Sasha Shipping Pvt. Ltd. v. Commissioner of Customs, decided on 4 November 2025, Justice G.R. Swaminathan set aside orders by the Commissioner of Customs, Tuticorin suspending and continuing the suspension of Sasha Shippingβs Customs Broker Licence. The Court found that Tuticorin was not the licence-issuing authority and therefore lacked jurisdiction to invoke the suspension power.
Background of the dispute
Sasha Shipping Pvt. Ltd. received its Customs Broker Licence from the Principal Commissioner of Customs, Chennai, in 2011. It subsequently began operating within the jurisdiction of the Tuticorin Customs Commissionerate from 21 June 2022 through a Form C intimation.
In August 2025, the Commissioner of Customs, Tuticorin formed the view that the company had committed irregularities relating to certain imports. On 20 August 2025, the Commissioner suspended Sasha Shippingβs licence with immediate effect under Regulation 16(1) of the Customs Brokers Licensing Regulations, 2018. A further order dated 3 September 2025 continued that suspension under Regulation 16(2).
Sasha Shipping challenged both orders. Its central argument was that Tuticorin, being a non-parent commissionerate, could not suspend a licence issued by Chennai.
The jurisdictional question before the Court
The case turned on the distinction between two Customs authorities:
Parent Commissionerate: The Commissionerate that grants the Customs Broker Licence.
Non-Parent Commissionerate: A Commissionerate where the broker operates under a Form C intimation after obtaining its original licence elsewhere.
The Court noted that a broker can transact business at Customs stations beyond its original Commissionerate, subject to the Form C process. However, Form C is only an intimation of the brokerβs intention to operate at another station; it is not a fresh licence or an authorization issued by that non-parent Commissionerate.
Initially, the Tuticorin order appeared to operate across all Customs stations. A corrigendum dated 14 October 2025 limited its reach to areas within the jurisdiction of the Tuticorin Custom House. Even after that correction, the principal issue remained: whether Tuticorin could suspend the licence at all.
Regulation 15 and Regulation 16 serve different purposes
The Court analysed the scheme of the 2018 Regulations, particularly Regulations 15, 16 and 17.
Regulation 15: Local prohibition by a non-parent Commissionerate
Regulation 15 allows a Commissioner other than the licence-issuing authority to prohibit a Customs Broker from working in one or more sections of the relevant Customs station if the broker has failed to meet its obligations. This is a limited local measure. The prohibition cannot continue for more than one month.
According to the Court, this provision equips a non-parent Commissionerate to respond immediately to misconduct occurring within its own jurisdiction.
Regulation 16: Suspension of the licence
Regulation 16 permits suspension of a Customs Broker Licence where immediate action is necessary and an inquiry is pending or contemplated. The Court held that this power belongs only to the Parent Commissionerate because that authority issued the licence in the first place.
The reasoning was straightforward: the authority that grants a licence has the inherent authority to amend, vary, rescind or suspend it. A non-parent Commissionerate, which has received only a Form C intimation, has not issued the licence and cannot suspend it.
Regulation 17: Further disciplinary process
Where suspension continues, Regulation 17 provides the procedure for notice, inquiry, evidence, representation and final action, including revocation or penalty. The Court read Regulations 15, 16 and 17 together as a coordinated framework:
A non-parent Commissionerate may impose a temporary local prohibition.
It should communicate the alleged violations to the Parent Commissionerate.
The Parent Commissionerate may then initiate suspension, revocation or penalty proceedings under the applicable regulations.
Why the Court rejected the Customs departmentβs argument
The Customs department argued that Regulation 16 uses the broad phrase βPrincipal Commissioner or Commissioner of Customs,β unlike Regulation 15, which specifically refers to Commissioners other than those mentioned in Regulation 7. It contended that this wording allowed any Commissioner to suspend a brokerβs licence.
The Court did not accept that interpretation. It held that the regulations must be read as a whole, rather than treating Regulation 16 in isolation. The existence of Regulation 15 showed that the regulatory framework already gives non-parent Commissionerates a defined remedy: temporary prohibition within their own Customs station.
Allowing a non-parent Commissionerate to suspend the licence itself would blur the statutory distinction between local prohibition and licence-level suspension.
Reliance on the 2010 CBIC circular
The Court also relied on CBIC Circular No. 9/2010-Cus., dated 8 April 2010. Although issued under the earlier Customs House Agents Licensing Regulations, 2004, the Court found it remained applicable because its principles were consistent with the 2018 Regulations and it had neither been superseded nor withdrawn.
The circular states that where a Customs broker operating under Form C is found to have committed violations at another Customs station:
The Commissionerate at that station should report the violations to the Commissionerate that issued the licence.
The licence-issuing Commissionerate should initiate suspension or revocation action.
The non-parent Commissionerate may, in appropriate cases, prohibit the broker from working locally.
This approach avoids duplicative proceedings and ensures uniform disciplinary action against Customs Brokers operating at multiple stations.
Courtβs decision
The High Court concluded that the Commissioner of Customs, Tuticorin was a non-parent Commissionerate because Sasha Shippingβs licence had been issued by Chennai. Consequently, Tuticorin could not exercise the suspension power under Regulation 16.
The Court set aside:
Order No. 15/2025 dated 20 August 2025, suspending Sasha Shippingβs Customs Broker Licence; and
Order No. 16/2025 dated 3 September 2025, continuing the suspension.
Both writ petitions were allowed, with no order as to costs.
Significance for Customs Brokers and Customs authorities
The ruling clarifies the limits of regulatory authority where a Customs Broker operates across India through Form C intimations. A non-parent Commissionerate can address suspected wrongdoing at its station through a short-term local prohibition, but it cannot suspend the underlying licence.
For licence suspension, revocation or broader disciplinary action, the matter must be taken up by the Commissionerate that originally issued the Customs Broker Licence.
The decision reinforces a clear division of powers, supports procedural consistency and prevents multiple Customs formations from taking overlapping action against the same licence.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 18.10.2026
Delhi High Court Upholds DMRCβs Refusal to Reimburse Rs.4.46 Crore in DVAT to L&T
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Delhi High Court has dismissed Larsen & Toubro Limitedβs challenge to an arbitral award that denied reimbursement of Rs.4.46 crore in Delhi Value Added Tax (DVAT) from Delhi Metro Rail Corporation Ltd. (DMRC), holding that the relevant supplies were connected to inter-State trade and import transactions and therefore fell outside DVAT.
The dispute: tax reimbursement under a metro contract
The case arose from a 2008 DMRC contract awarded to a consortium comprising Larsen & Toubro (L&T) and Furrer + Frey AG. The contract concerned the design, supply, installation, testing and commissioning of a 25 kV rigid overhead contact system and related cabling for sections of Delhi Metroβs Phase-II network.
The contract value was approximately Rs.43.37 crore, along with USD 2.02 million and Swiss Franc 5.49 million. It required the contractor to deliver and install equipment including contact wires, traction cables, sectioning posts, sub-sectioning posts, return conductors and associated systems.
A key contractual clause provided that DMRC would reimburse DVAT or Uttar Pradesh trade tax, where applicable, on indigenous equipment upon proof of actual payment. L&T argued that it had paid DVAT of Rs.4,45,73,743 on the equipment and systems supplied to DMRC in Delhi and was entitled to reimbursement.
Why L&T claimed DVAT reimbursement
L&T procured high-voltage and low-voltage panels, cables and other components from suppliers outside Delhi. Some high-voltage panels were imported from Germany by an Indian supplier, while certain other materials were obtained through inter-State transactions.
According to L&T, these components were not supplied to DMRC as standalone items. Instead, they were transported to project sites, assembled, integrated, installed and commissioned into sectioning and sub-sectioning posts and other bill-of-quantities items. L&T maintained that the completed systems were commercially distinct products supplied to DMRC in Delhi, making the transactions local sales subject to DVAT.
L&T also relied on two aspects of DMRCβs conduct:
DMRC initially reimbursed one DVAT invoice, though it later recovered the amount from L&Tβs running bills.
DMRC deducted works-contract tax at source from invoices, which L&T argued showed that DMRC had treated the supplies as local transactions.
DMRCβs position: the supplies were exempt from DVAT
DMRC argued that reimbursement was only available where DVAT was legally applicable. It contended that the goods were procured specifically for the metro project through imports and inter-State purchases, meaning that the transactions were exempt from DVAT under Section 7 of the DVAT Act.
DMRC relied on facts showing a close contractual connection between the goods and the project:
DMRC prescribed technical specifications for the equipment.
It approved the suppliers, including the foreign supplier of the high-voltage panels.
It required pre-inspection of goods.
The goods were custom-made for the metro project.
DMRC issued customs and excise-duty exemption certificates.
The invoices and packaging identified DMRC as the consignee or stated that the goods were for the DMRC project.
DMRC maintained that these facts established that the movement of goods into Delhi, whether from another State or from abroad, was occasioned by and integral to the underlying works contract.
Arbitration award: no reimbursement due
The arbitral tribunal rejected L&Tβs claim in its entirety and issued a nil award. It concluded that the imported high-voltage panels and the materials procured from outside Delhi were directly connected with the DMRC contract.
The tribunal found that the relevant domestic procurements were inter-State sales subject to Central Sales Tax, while the imported equipment was part of a transaction in the course of import. As these categories are excluded from DVAT under Section 7 of the DVAT Act, DMRC was not required to reimburse the tax paid by L&T.
The tribunal also held that DMRCβs initial reimbursement of one invoice and later recovery of that amount was a rectifiable mistake, not an admission that DVAT was properly payable. Since the principal claim failed, the tribunal rejected L&Tβs claims for interest and arbitration costs as well.
High Courtβs analysis: contractual tax disputes can be arbitrated
Before addressing the tax issue, the Court considered L&Tβs argument that an arbitral tribunal could not decide whether DVAT applied because taxability is a matter for statutory authorities.
The Court rejected that objection. It drew a distinction between disputes that require a binding statutory tax determination and disputes between contracting parties over tax reimbursement or allocation of tax liability. The latter category is contractual and can be resolved through arbitration.
Here, the dispute centred on whether DMRC was contractually obliged to reimburse DVAT under the relevant clause. The Court held that this was an arbitrable issue between the parties.
ABB precedent was decisive
The Court held that the case was squarely governed by the earlier decision in ABB Ltd., which had been affirmed by the Supreme Court. That precedent involved a DMRC works contract for electrical and traction systems and examined whether goods procured from outside Delhi or through import were subject to DVAT.
The governing test is whether the movement of goods is integrally connected with the contract for their supply. An express contractual clause requiring inter-State movement is not necessary. It is enough if the movement is pursuant to, or incidental to, the contract.
Applying this principle, the Court found a direct and continuing link between the procurement of the panels and other equipment and L&Tβs obligations to DMRC. The fact that L&T integrated the input materials into sectioning and sub-sectioning posts did not break that connection.
Limited judicial review under Section 34
The Court emphasised that a Section 34 petition is not an appeal against an arbitral award. A court cannot reassess the evidence merely because another interpretation may be possible. Intervention is warranted only on narrow grounds, such as patent illegality going to the root of the matter.
The tribunal had considered the relevant invoices, supplier approvals, customs exemptions, project specifications, consignment details and the partiesβ submissions. Its conclusion that the supplies were linked to inter-State trade and import was therefore a plausible view supported by the record.
Outcome and practical significance
The Delhi High Court dismissed L&Tβs petition, upheld the nil arbitral award and made no order on costs.
The ruling reinforces two important principles for infrastructure and works-contract disputes:
Tax reimbursement clauses depend on legal applicability. A contractual promise to reimburse VAT does not require reimbursement where the transaction is legally exempt from that State tax.
The contractual nexus of goods movement is critical. In projects involving customized equipment, approved suppliers, import-duty exemptions and project-specific consignments, the movement of goods may remain an import or inter-State transaction even after installation or integration into a larger system.
The decision also confirms that arbitrators may decide contractual disputes over which party must bear or reimburse tax, provided they are not purporting to replace the statutory tax authorities on matters that require a binding public-law tax determination.
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Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 17.10.2026
Rules of Origin vs. Rules of Customs: Constitutional Authority, Treaty Enforcement and the New CBIC Clarification
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
From Article 253 of the Constitution to Section 28DA of the Customs Act: Understanding how international trade commitments become enforceable rights under Indian law.
Introduction: When International Trade Commitments Meet Domestic Customs Administration
India’s expanding network of Free Trade Agreements (FTAs) and Comprehensive Economic Partnership Agreements (CEPAs) has transformed the legal framework governing international trade. These agreements offer preferential market access, reduced Customs duties and enhanced commercial opportunities. However, their effective implementation depends upon a fundamental constitutional question: Can domestic Customs authorities impose conditions that dilute or defeat the benefits negotiated under a bilateral Trade Agreement?
This question has acquired renewed importance following CBIC Circular No. 43/2026-Customs, dated 24 September 2026. The Circular clarifies the relationship between Section 28DA of the Customs Act, 1962, the Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020 (CAROTAR), and the Rules of Origin contained in India’s Trade Agreements.
Its significance extends beyond routine Customs administration. It raises questions concerning constitutional treaty-making powers, legislative competence, delegated legislation, administrative discretion and the enforceability of international obligations within India’s domestic legal system.
The Circular specifically addresses two recurring disputes: the insistence upon Form-I for preferential tariff claims under the IndiaβUK Comprehensive Economic and Trade Agreement (CETA), and the automatic denial of preferential treatment to subsequent consignments following an earlier adverse origin determination.
By reiterating that agreement-specific Rules of Origin prevail over conflicting CAROTAR provisions, CBIC has reinforced an essential legal distinction between the authority to verify preferential claims and the power to impose additional substantive conditions.
To appreciate the Circular’s wider significance, it is necessary to examine the constitutional foundation of India’s bilateral trade agreements, the mechanism through which international obligations acquire domestic legal effect, and the judicial principles governing Customs exemptions and administrative interpretation.
I. Constitutional Foundation of Bilateral Trade Agreements in India
The Constitution of India does not contain a single provision exclusively governing Free Trade Agreements. Instead, India’s treaty-making and treaty-implementation powers arise from several interconnected constitutional provisions.
Article 51(c): Respect for International Law and Treaty Obligations
Article 51(c), contained in Part IV of the Constitution, directs the State to foster respect for international law and treaty obligations in dealings between organised peoples. This provision reflects India’s constitutional commitment to international cooperation and the observance of treaty obligations.
However, Article 51(c) forms part of the Directive Principles of State Policy. By virtue of Article 37, these principles are not directly enforceable by courts, although they remain fundamental to governance. Consequently, Article 51(c) does not independently transform an international trade agreement into an enforceable domestic statute.
Its principal significance lies in guiding constitutional interpretation and encouraging consistency between domestic law and India’s international commitments.
Article 73: Executive Authority to Negotiate and Conclude Trade Agreements
Article 73 defines the extent of the Union’s executive power. Read with Articles 53 and 246 and the relevant Union List entries, it provides the constitutional foundation for the Union executive’s authority in international relations.
Accordingly, the Central Government may negotiate and conclude bilateral and multilateral trade agreements within its constitutional competence. Such agreements may cover tariff concessions, market access, Rules of Origin, investment protection, services, intellectual property, technical barriers to trade and dispute-settlement arrangements.
However, an important distinction must be maintained between concluding an international agreement and giving its provisions enforceable domestic legal effect. An international agreement may bind India at the international level without automatically creating enforceable rights or obligations against private parties under Indian municipal law.
Where implementation requires alteration of existing legislation, restriction of legal rights or imposition of domestic obligations, appropriate legislative authority becomes necessary.
Article 253: Parliament’s Power to Implement International Agreements
Article 253 is the central constitutional provision concerning domestic implementation of international treaties. It empowers Parliament to legislate for implementing treaties, agreements and conventions with foreign countries, notwithstanding the ordinary distribution of legislative powers between the Union and States.
Its importance is twofold. First, it enables Parliament to implement international obligations through domestic legislation. Second, it permits Parliament to legislate even upon matters ordinarily falling within State legislative competence when implementing an international agreement.
Therefore, Article 253 acts as a constitutional bridge between international commitments and domestic legislative authority. However, Article 253 is an enabling provision. It does not automatically make every provision of a bilateral trade agreement directly enforceable in Indian courts.
The Supreme Court’s decision in Maganbhai Ishwarbhai Patel v. Union of India, AIR 1969 SC 783, remains particularly important in understanding this distinction.
Article 246 and the Seventh Schedule: Legislative Competence Over Foreign Trade
Article 246 distributes legislative competence between Parliament and State Legislatures.
Several entries in List I of the Seventh Schedule are directly relevant to bilateral trade agreements.
Constitutional provision
Subject matter
Relevance to international trade
Union List, Entry 10
Foreign affairs and matters concerning the Union’s relations with foreign countries
International economic relations and trade negotiations
Union List, Entry 14
Entering into treaties and agreements with foreign countries and implementing them
Constitutional legislative foundation for treaty implementation
Union List, Entry 41
Trade and commerce with foreign countries; import and export across Customs frontiers
Import-export regulation and foreign trade administration
Union List, Entry 83
Duties of Customs, including export duties
Customs tariff legislation and duty concessions
Article 253
Legislation implementing international agreements
Parliamentary authority extending beyond ordinary federal legislative limitations
These provisions collectively explain why international trade negotiations, Customs tariff legislation and foreign trade regulation principally fall within Union competence.
Articles 265 and 14: Constitutional Controls Over Customs Administration
Article 265 provides that no tax shall be levied or collected except by authority of law.
This principle is central to Customs taxation. An international agreement does not, merely through its execution, independently amend the Customs tariff or authorise Customs authorities to collect duties contrary to domestic law.
Preferential tariff treatment must be implemented through a legally valid domestic mechanism. Conversely, once a preferential concession has been lawfully implemented, its administration must remain within the governing statute and notification.
Article 14 introduces another constitutional limitation. Administrative decisions must not be arbitrary, discriminatory or unsupported by legally relevant considerations. Accordingly, Customs officers exercising powers under Section 28DA and CAROTAR remain subject to constitutional standards of legality, reasonableness and non-arbitrariness.
II. How Are Bilateral Trade Agreements Enforced Domestically in India?
India broadly follows a dualist approach to international treaties. Under this approach, international obligations and domestic legal rights operate in related but distinct legal spheres.
The execution of an international agreement does not necessarily make all its provisions directly enforceable against individuals or authorities. Domestic implementation may occur through legislation, statutory notifications, delegated legislation or executive action supported by existing law.
The Domestic Implementation Mechanism
1. Negotiation and conclusion of a Trade Agreement
Union executive authority under the Constitution
2. Identification of domestic legal requirements
Articles 246 and 253; relevant Union List entries
3. Implementation through Indian law
Customs Act, Customs Tariff Act, notifications and Rules of Origin
4. Administration of preferential tariff claims
Section 28DA, CAROTAR and the applicable Trade Agreement
5. Judicial review and statutory remedies
Customs appeals and constitutional remedies, where maintainable:-
In the Customs context, Section 5 of the Customs Tariff Act, 1975 enables the Central Government to make rules for determining the origin of goods under Trade Agreements. Preferential tariff concessions are generally implemented through notifications issued under the relevant statutory powers, including Section 25 of the Customs Act.
Section 28DA and CAROTAR then regulate the administration and verification of preferential claims. Thus, an FTA’s tariff commitments do not ordinarily operate as an independent substitute for India’s Customs legislation. Their domestic enforceability must be examined through the applicable implementing law.
III. Landmark Constitutional Precedent: Maganbhai Ishwarbhai Patel v. Union of India
Case: Maganbhai Ishwarbhai Patel v. Union of India Citation: AIR 1969 SC 783; (1969) 3 SCC 400 Court: Supreme Court of India Date: 9 January 1969
The dispute arose from the implementation of an international boundary determination involving India and Pakistan. The Supreme Court considered the constitutional powers of the Union executive to enter into international agreements and the circumstances requiring parliamentary legislation. The Court recognised that the executive could conclude international agreements within its constitutional authority.
However, it distinguished international obligations from their domestic legal consequences. Where implementation affects enforceable private rights or modifies existing domestic law, legislative support is required. The Court also explained the significance of Article 253 and Parliament’s authority to implement international agreements.
Commentary
Although the judgment concerned an international boundary dispute rather than an FTA, its constitutional reasoning remains directly relevant to trade agreements. It establishes that the Union executive’s treaty-making authority and Parliament’s treaty-implementation authority are legally distinct.
Consequently, a bilateral trade agreement cannot automatically override an inconsistent Indian statute merely because India has accepted the agreement internationally. The legally enforceable rights of importers must be identified through the applicable domestic implementing provisions, interpreted in light of the Trade Agreement where the law permits or requires such interpretation.
IV. Section 28DA of the Customs Act: The Statutory Framework for Preferential Origin
Section 28DA, introduced through the Finance Act, 2020, establishes the responsibilities of importers claiming preferential Customs duty under Trade Agreements.
The provision was intended to strengthen verification of originating status and prevent the misuse of preferential tariff concessions. Under Section 28DA(1), importers must declare that imported goods qualify as originating goods, possess sufficient supporting information, furnish prescribed particulars and exercise reasonable care regarding the accuracy of origin claims.
Section 28DA(2) makes it clear that the mere submission of a Certificate of Origin does not discharge the importer’s responsibility to exercise reasonable care. However, this provision cannot be interpreted in isolation.
Section 28DA(3) contemplates requests for further information consistent with the relevant Trade Agreement. This qualification is important because different agreements prescribe different documentary and verification procedures.
Section 28DA also establishes mechanisms for origin verification, suspension of preferential treatment, provisional clearance and denial of preferential benefits in specified circumstances. Subsection (11) addresses subsequent imports of identical goods following an earlier adverse origin determination. Importantly, the statutory framework does not confer unrestricted authority upon Customs to disregard agreement-specific origin procedures.
V. CAROTAR, 2020: Procedural Compliance and the Limits of Delegated Legislation
CAROTAR, 2020 was notified through Notification No. 81/2020-Customs (N.T.), dated 21 August 2020, and came into effect on 21 September 2020.
The Rules provide a domestic administrative mechanism for implementing Section 28DA. Rule 3 governs preferential tariff claims at the Bill of Entry stage. Rule 4 addresses the information importers must possess, including origin-related information identified in Form-I.
Rule 5 governs requests for further information. Rule 6 provides for verification through the prescribed authorities, while Rule 7 addresses identical goods and earlier adverse origin determinations.
Rule 8 deals with additional administrative matters, including consequences of non-compliance.
Rule 8(3): The Most Important Provision
Rule 8(3) expressly provides that where CAROTAR conflicts with the Rules of Origin under the relevant Trade Agreement, the latter shall prevail. This creates a specific rule of precedence within the domestic regulatory framework.
Its legal effect should be carefully understood. Rule 8(3) does not establish that every international treaty automatically overrides Indian legislation. Rather, it is a domestic legal provision expressly recognising the precedence of agreement-specific Rules of Origin over conflicting CAROTAR requirements.
The distinction is constitutionally significant. The authority of the Trade Agreement’s Rules of Origin in this context flows through the statutory framework enacted and notified under Indian law. Accordingly, Customs officers cannot disregard Rule 8(3) while administering preferential tariff claims.
VI. CBIC Circular No. 43/2026: Five Major Legal Clarifications
1. Valid Origin Declaration Under IndiaβUK CETA
Paragraph 2.1.1 recognises an Origin Declaration completed by the UK exporter or producer in the prescribed manner as proof of origin.
Therefore, a claim supported by a valid Origin Declaration must be processed without requiring Form-I. This clarification protects importers from an additional routine documentary requirement. However, the declaration must satisfy the applicable agreement’s conditions, and the goods must qualify under the relevant Rules of Origin.
2. Form-I Cannot Be a Routine Precondition
Paragraph 2.1.2 clarifies that Form-I is not required to be submitted with the Bill of Entry. Customs cannot treat its submission as a mandatory precondition for preferential tariff treatment. Nevertheless, the Circular does not abolish Form-I or eliminate lawful requests for origin-related information.
3. Requests for Form-I Information Are Restricted
Paragraph 2.1.3 identifies two cumulative conditions for seeking relevant Form-I information under the clarification concerning IndiaβUK CETA.
The Bill of Entry must have been interdicted by the National Risk Management System for origin-related checks, and the proper officer must have reason to believe that the applicable origin criteria have not been satisfied. The words used in the Circular limit routine administrative discretion. However, other verification powers lawfully available under the governing framework remain subject to their respective statutory conditions.
4. Confidential Commercial Information Is Protected
Paragraph 2.1.4 clarifies that IndiaβUK CETA importers need not obtain confidential information from exporters or producers.
Failure to furnish such information cannot, by itself, justify denial of preferential treatment. The importer must nevertheless provide information made available by the exporter or producer. Where the information remains insufficient, verification may be undertaken through the exporting Party’s Verification Authority in accordance with the Trade Agreement.
Paragraphs 2.2.1 to 2.2.3 address Section 28DA(11).
The Circular rejects the assumption that goods are identical merely because they share an HSN classification, description, exporter, producer or technical characteristics.
Before applying an earlier adverse determination, Customs must provide the importer an opportunity to furnish additional information. Where material origin-related facts differ, the current claim must be independently examined. This safeguard is particularly relevant to industrial imports involving changing suppliers, production arrangements, originating inputs and manufacturing processes.
VII. Supreme Court Judgments from 2025: Their Relevance to Customs Exemptions and Administrative Powers
The following decisions were delivered within the preceding two years. Their holdings are relevant to the broader legal principles involved, although neither directly adjudicates Circular No. 43/2026.
A. M/s L.G. Electronics India Private Limited v. Commissioner of Customs
Court: Supreme Court of India Decision: 10 September 2025 Proceedings: Civil Appeal Nos. 10349β10350 of 2024
The Supreme Court allowed LG Electronics India Pvt. Ltd.βs customs appeals concerning the import classification of G Watch smartwatches.
While it did not decide the classification dispute, the Court held that LG was eligible for the Korea-origin duty exemption based on the Certificate of Origin, set aside the CESTAT and original orders, and directed refund of the duty paid with applicable interest within two months.
Legal commentary: The Supreme Court rightly distinguished tariff classification from entitlement to a preferential-origin exemption, holding that an incorrect claimed classification cannot defeat a substantive benefit otherwise established by a valid Certificate of Origin. While leaving the smartwatch classification issue open, the ruling reinforces that customs adjudication must prioritize proven statutory conditions over technical errors made in good faith.
B. Noble Resources and Trading India Private Limited v. Union of India & Others
Citation: 2025 INSC 684 Court: Supreme Court of India Decision: 14 May 2025 Proceedings: Civil Appeal No. 2572 of 2025
The dispute concerned an exemption claimed on imported crude degummed soyabean oil under the applicable Duty Free Credit Entitlement framework.
The Department relied upon a Customs circular to extend an exclusion concerning agricultural and dairy products to certain manufactured products derived from agricultural commodities. The Supreme Court rejected the enlarged interpretation and held that the departmental circular could not expand the exclusion beyond the governing notification.
The Court allowed the importer’s appeal.
Legal commentary: This decision reinforces the principle that executive circulars cannot alter the substantive scope of statutory exemptions. Although the case did not concern Section 28DA or FTA origin verification, its reasoning is relevant where departmental instructions purport to impose restrictions beyond the governing legal instrument. The decision also demonstrates the importance of distinguishing a statutory condition from an administrative interpretation.
C. The Constitutional Connection
The decisions in Maganbhai, L.G. Electronics and Noble Resources operate at different levels. Maganbhai addresses the constitutional relationship between international agreements and domestic legislation.
L.G. Electronics concerns the examination of preferential Customs exemption entitlement. Noble Resources addresses the limits of departmental circulars in interpreting statutory exemptions.
Taken together, these authorities support the proposition that Customs administration must operate within the authority conferred by Indian law. They do not establish an unrestricted supremacy of FTAs over Parliament’s legislation. Instead, they reinforce lawful implementation, proper statutory interpretation and limitations on executive action.
VIII. Constitutional and Administrative Limitations on Customs Discretion
The Circular raises several questions concerning the lawful exercise of Customs powers. Under Article 265, Customs duty must have legal authority. Consequently, tariff concessions and their withdrawal must be examined within the applicable statutory framework.
Article 14 requires administrative action to satisfy constitutional standards against arbitrariness. Article 19(1)(g), subject to Article 19(6), protects the right of citizens to practise professions and carry on occupations, trade or business. This does not eliminate lawful import restrictions, but it may be relevant where administrative action unjustifiably interferes with protected commercial activity.
Article 226 empowers High Courts to exercise judicial review over unlawful administrative action, subject to principles governing the availability of alternative statutory remedies.
Therefore, Customs action concerning preferential tariff claims may raise constitutional issues where it exceeds statutory authority, disregards mandatory procedures or violates principles of natural justice. However, not every disagreement concerning an origin determination constitutes a constitutional violation.
Ordinary disputes involving documentary sufficiency, factual origin criteria or assessment may appropriately fall within the Customs Act’s statutory appellate framework. The constitutional remedy becomes particularly relevant where the challenge concerns jurisdictional error, procedural illegality, violation of natural justice or the validity of subordinate legislation.
IX. Inclusions, Exclusions, Limitations and Discretions: A Consolidated Legal Position
Category
Legal position
Constitutional inclusion
Articles 73 and 253 provide distinct foundations for treaty-making and legislative implementation.
Legislative inclusion
Customs Act and Customs Tariff Act provisions provide mechanisms for domestic administration of trade commitments.
Preferential origin inclusion
Valid agreement-prescribed origin documents support preferential claims.
Procedural exclusion
Form-I cannot be imposed routinely as a prerequisite under the IndiaβUK CETA clarification.
Confidentiality exclusion
IndiaβUK CETA importers need not obtain confidential exporter or producer information.
Statutory limitation
Importers must exercise reasonable care and satisfy substantive origin requirements.
Treaty limitation
International agreements do not automatically override inconsistent Indian primary legislation.
Administrative limitation
CAROTAR cannot override conflicting Rules of Origin under the applicable Trade Agreement, as recognised by Rule 8(3).
Customs discretion
Origin-related information and verification may be sought within the prescribed conditions.
Identical-goods safeguard
Earlier adverse determinations cannot be applied mechanically without considering relevant origin facts and additional information.
Judicial safeguard
Unlawful administrative action may be challenged through statutory remedies or constitutional judicial review, as appropriate.
X. A Constitutional Question for Future Litigation
One of the most significant questions emerging from this framework is whether a delegated rule, administrative instruction or Customs assessment can impose requirements inconsistent with the Rules of Origin incorporated into India’s domestic legal framework.
The answer requires identifying the precise legal source of each obligation. Where an agreement-specific rule has been implemented under the Customs Tariff Act, the officer must consider that rule alongside Section 28DA and CAROTAR. Where CAROTAR itself expressly gives precedence to the Trade Agreement’s Rules of Origin, administrative authorities must respect that prescribed hierarchy.
Where a conflict arises between an international commitment and primary parliamentary legislation, the analysis is different. The international agreement does not automatically invalidate or override the statute. The constitutional distinction is fundamental.
The enforceability of preferential trade benefits in India rests not merely upon diplomatic commitments but upon their lawful incorporation and administration under the Indian legal system.
Consequently, future litigation may increasingly examine whether origin-verification demands are supported by statutory authority, whether they comply with the applicable Trade Agreement, and whether administrative discretion has been exercised for a legitimate legal purpose.
XI. The Role of Aadrikaa Legal Services in Corporate Legal Support and Case Research
Aadrikaa Legal Services (ALS) assists large corporates, in-house legal departments, law firms and professional advisory organisations with specialised paralegal support and legal research relating to Customs, GST, Foreign Trade Policy, international trade compliance and regulatory disputes. Its support may include case-law research, statutory interpretation, preparation of legal research notes, compilation of judicial precedents, document examination, litigation chronologies, drafting assistance, regulatory compliance reviews and preparation of case briefs for counsel.
By combining legal research with domain-specific knowledge of Customs and trade regulations, ALS aims to support corporate legal teams and law firms in managing complex regulatory matters, developing litigation strategies and preparing well-researched submissions before statutory and judicial forums.
XII. Conclusion: The Constitution Sets the Boundary, Parliament Creates the Framework, and Customs Must Follow the Law
CBIC Circular No. 43/2026-Customs is more than a procedural clarification concerning Form-I and Rules of Origin. It highlights the constitutional relationship between India’s international trade commitments and their domestic implementation.
Articles 73 and 253 establish the foundations of treaty-making and legislative implementation. Articles 246 and 265 define the relevant legislative and taxation framework, while Article 14 imposes constitutional limitations upon administrative action.
Section 28DA and CAROTAR provide the domestic machinery for administering preferential tariff claims. However, Rule 8(3) expressly recognises that conflicting CAROTAR provisions must yield to the applicable Trade Agreement’s Rules of Origin.
The Supreme Court’s decisions in Maganbhai, L.G. Electronics and Noble Resources illuminate the constitutional and statutory principles that govern this relationship. The essential legal conclusion is that Customs authorities retain the power to verify originating status, prevent misuse of preferential concessions and protect public revenue.
What they cannot do is transform procedural authority into an independent power to impose substantive conditions unsupported by the governing law.
For importers, the Circular provides meaningful procedural protection. For Customs authorities, it reinforces the requirement of agreement-consistent administration. For legal practitioners, it offers a framework for examining origin disputes through statutory interpretation, delegated legislation and constitutional principles.
Ultimately, India’s international trade commitments can deliver their intended commercial benefits only when their domestic implementation remains legally coherent, transparent and consistent with the constitutional rule of law.
About the Author
Advocate Ravi Shekhar Jha is a New Delhi-based legal professional practising in matters involving Customs, indirect taxation, constitutional law, international trade and regulatory compliance, including matters before the Delhi High Court and statutory tribunals.
With approximately two decades of experience in international trade, regulatory advisory and supply-chain compliance, his professional work encompasses Customs classification and valuation, Free Trade Agreements, Rules of Origin, DGFT and Foreign Trade Policy matters, BIS and Quality Control Orders, trade remedies, and Customs litigation.
He holds an LL.M. in Constitutional Law and is associated with Aadrikaa Legal Services (ALS), which provides legal advisory, litigation, research and regulatory support to corporate clients and professional organisations.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 17.10.2026
Supreme Court: Conscious Possession Must Be Established for Conviction Under Section 15 of NDPS Act
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Supreme Court of India dismissed the State of Punjabβs appeal against the acquittal of Hari Singh and other accused, holding that a failure to question them on the central allegation of conscious possession under Section 313 of the Code of Criminal Procedure (CrPC) materially weakened the prosecutionβs case.
Case at a glance
In State of Punjab v. Hari Singh & Ors., the respondents had initially been convicted under Section 15 of the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act). The trial court sentenced each accused to 10 yearsβ rigorous imprisonment and imposed a fine of Rs. 1,00,000.
The prosecution alleged that police officers found the accused sitting on 16 gunny bags of poppy husk, each weighing 30 kilograms, near sugarcane fields on 9 July 1999. The accused were arrested after the bags were searched in the presence of a Deputy Superintendent of Police, following their request for the presence of a Gazetted Officer.
The Punjab and Haryana High Court later acquitted the accused. The State challenged that acquittal before the Supreme Court.
The central legal issue: conscious possession
Section 15 of the NDPS Act penalizes unlawful possession of poppy straw. The Court emphasized that possession in this context is not limited to physical custody. For criminal liability, the prosecution must establish conscious possession: possession coupled with awareness and the required mental element.
The judgment explains that βpossessionβ can take different forms depending on the circumstances. It may be:
Physical possession, where a person directly holds or carries an article; or
Constructive possession, where a person has the power and control to deal with the article even if it is not physically on them.
The Court noted that the evidence in this case, including the allegation that the accused were sitting on the bags, was relevant to conscious possession. Under Sections 35 and 54 of the NDPS Act, statutory presumptions may arise once possession is established. A person claiming that possession was not conscious may need to explain circumstances particularly within their knowledge.
However, proving or relying on possession was not enough by itself. The accused had to be given a fair opportunity to respond to that allegation.
Why the Section 313 CrPC examination was decisive
The Supreme Court found that the accused were not asked any question during their examination under Section 313 CrPC about possession or conscious possession of the contraband.
Section 313 requires the court, after the prosecution evidence closes, to question the accused so they can personally explain circumstances appearing against them. This is a core safeguard in a criminal trial, not a procedural formality.
The Court reaffirmed several principles:
Every material incriminating circumstance should be put to the accused. This allows a meaningful explanation or defence.
A circumstance not put to the accused ordinarily cannot be used against them.
The purpose is fairness. The provision gives effect to the natural-justice principle that a person must have an opportunity to answer the case against them.
Prejudice matters. An omission does not automatically invalidate every trial, but a conviction cannot safely rest on a vital fact that the accused were never asked to explain.
Here, conscious possession was the essence of the accusation under the NDPS Act. Because that crucial issue was omitted from the Section 313 examination, the omission was held to have a vital effect on the prosecution case.
The Courtβs guidance on personal appearance under Section 313
The judgment also discussed when an accused must personally appear to answer Section 313 questions. The general rule is that the accused should be personally examined, particularly in cases more serious than summons cases.
Still, the Court endorsed a limited practical exception for genuine hardship. If an accused already exempted from personal appearance cannot attend because of substantial expense, physical incapacity, or another justified difficulty, the court may permit written answers through a questionnaire.
This alternative requires safeguards, including:
A written application supported by the accusedβs own affidavit explaining the difficulty.
An assurance that the accused will not suffer prejudice from the arrangement.
An undertaking not to challenge the exemption later.
Personally authenticated answers, signed by the accused on every page and returned within the deadline fixed by the court.
The Court stressed that this is an exceptional arrangement. It cannot become a way for counsel to substitute their own answers for the accusedβs statement.
Outcome of the appeal
The Supreme Court upheld the High Courtβs acquittal and dismissed the State of Punjabβs appeal. It concluded that, despite evidence bearing on conscious possession, the failure to put that essential allegation to the accused under Section 313 CrPC justified refusing to interfere with the acquittal.
The Court did remove one part of the High Courtβs order: directions to initiate action against certain officials were expunged because such directions should not have been issued while deciding the criminal appeal.
Key takeaway
This decision shows that even in serious NDPS prosecutions, procedural fairness remains indispensable: a conviction cannot rely on a decisive incriminating circumstance, such as conscious possession, unless the accused has been given a proper opportunity to explain it under Section 313 CrPC.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 17.10.2026
Delhi HC: ROC Approval Does Not Validate a Corporate Name That Violates Companies Act
This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .
The Delhi High Court directed Mondelez India Private Limited to adopt a different corporate name after finding that its use of βMondelezβ was deceptively similar to the pre-existing name of Mondelez Foods Private Limited.
Background of the dispute
Mondelez Foods Private Limited, incorporated on 28 May 2012, challenged the Registrar of Companiesβ approval of a name change by Nonstop Logistics India Private Limited to βMondelez India Private Limited.β The new certificate of incorporation was issued on 11 September 2012.
The petitioner argued that βMondelezβ was a distinctive and coined term associated with the Mondelez group and its trademark rights. It stated that it was authorized to use the name and that the later adoption by the other company was intended to exploit the established reputation connected with the word.
Documents submitted for the name-change request recorded that the company sought the new name because its directors considered it βlucky for business transactions.β The petitioner also noted that the company applied to register a βMondelezβ logo for similar goods.
Earlier action and rejection by the Regional Director
Before approaching the High Court, Mondelez Foods Private Limited sent legal notices and filed a rectification representation under Section 22 of the Companies Act, 1956. The Regional Director rejected the representation on two principal grounds:
The petitioner was not itself the registered proprietor of the βMondelezβ trademark.
More than 12 months had passed since the registration of the changed corporate name.
Separately, Intercontinental Great Brands, LLC, formerly known as Kraft Foods Global Brands, LLC, and Mondelez Foods Private Limited obtained a decree in a civil suit on 24 July 2014. That decree restrained the company and related defendants from using βMondelezβ as a trademark, trade name, corporate name, or part of a corporate name.
Courtβs findings
Justice Vibhu Bakhru observed that the respondent company did not appear to contest the petition. As a result, the petitionerβs allegations about the respondentβs conduct and intent remained uncontroverted.
The Court held that the adoption of βMondelezβ was dishonest and mala fide. It emphasized that βMondelezβ is a coined and distinctive word, as well as a prominent part of both companiesβ names. The Court therefore found the names deceptively similar.
Under Section 20 of the Companies Act, 1956, a company cannot be registered under an undesirable name. A name may be considered undesirable if it is identical with or too nearly resembles the name of an existing company or a registered trademark. The Court found that the respondentβs name fell within this prohibition and should not have been registered by the Registrar of Companies.
Effect of the Companies Act, 2013
The Court noted uncertainty in the wording of Section 22 of the 1956 Act, particularly concerning the 12-month period for a direction to change a company name. However, it considered the newer Companies Act, 2013, which empowers the Central Government to direct a company to change a name that is identical with or too nearly resembles a previously registered company name.
Because βMondelez India Private Limitedβ too closely resembled βMondelez Foods Private Limited,β the Court concluded that the Regional Director had the authority to require a correction.
Final order
On 7 July 2017, the Delhi High Court directed the Regional Director to issue the necessary instructions requiring Mondelez India Private Limited to change its name. The replacement name must not be identical with or resemble the petitionerβs name or that of any other existing company.
The company and its directors were also expressly directed to ensure compliance with the name-change requirement.
Why the ruling matters
The decision reinforces that company-name registration is not a mere administrative formality. A distinctive pre-existing corporate identity can be protected where a later name is confusingly similar, particularly when the record indicates dishonest adoption. It also illustrates the interaction between company-name law and trademark protection in preventing misleading corporate identities.
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