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Tag: #CESTAT

  • CESTAT Allahabad Sets Aside Penalties in Alleged Over Invoicing

    CESTAT Allahabad Sets Aside Penalties in Alleged Over Invoicing

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 15.10.2025

    CESTAT Allahabad Sets Aside Penalties in Alleged Over Invoicing

    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 landmark decision, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Allahabad, has delivered justice to exporters M/s Shree Venkateswara Exports and M/s Surya Jyoti Global Logistics by setting aside penalties and redemption fines imposed under Sections 114 and 114AA of the Customs Act, 1962. The case revolved around allegations of over-invoicing export goods to claim inadmissible drawback benefits, but the Tribunal found no substantial evidence to support these claims. ​

    Background of the Case

    The dispute originated from the export of readymade garments by M/s Shree Venkateswara Exports through Customs Broker M/s Surya Jyoti Global Logistics. The Directorate of Revenue Intelligence (DRI) alleged that the goods were overvalued to claim excessive drawback benefits. ​ Following investigations, the goods were confiscated, and penalties totaling Rs. ​ 22,21,267/- were imposed on both appellants, along with a redemption fine of Rs. ​ 66,63,800/-. The appellants challenged the Order-in-Original passed by the Principal Commissioner of Customs, Noida, citing procedural lapses, lack of evidence, and violation of natural justice.

    Connected Matter

    Supreme Court Rejects Arbitrary Market Enquiry in Export Drawback

    Source: CESTAT Allahabad

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  • CESTAT Delhi- Royalty Payments Not Includible in Transaction Value of Imported Goods

    CESTAT Delhi- Royalty Payments Not Includible in Transaction Value of Imported Goods

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 15.10.2025

    CESTAT Delhi- Royalty Payments Not Includible in Transaction Value 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.

    On October 14, 2025, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Principal Bench, New Delhi, delivered a significant judgment in the case of M/s. ​ Ericsson India Private Limited vs. Additional Director General (Adjudication), Directorate of Revenue Intelligence. ​ This decision, which involved three appeals (Customs Appeal Nos. 50439, 50440, and 50441 of 2021), has far-reaching implications for the inclusion of royalty payments in the transaction value of imported goods under customs law.

    Background of the Case

    Ericsson India, a wholly-owned subsidiary of LM Ericsson Sweden, is engaged in the manufacture and sale of telecom equipment such as Radio Base Stations, Mobile Switching Centers, and Base Station Controllers. ​ The company imports components from its related foreign supplier, Ericsson Sweden, and pays royalties to LM Ericsson Sweden for technical know-how under a Technical Co-Operation Agreement. ​ The dispute arose when the Directorate of Revenue Intelligence (DRI) alleged that the royalty payments made by Ericsson India to LM Ericsson Sweden should be included in the transaction value of the imported components under Rule 10(1)(c) of the Customs Valuation (Determination of the Value of Imported Goods) Rules, 2007. ​ The DRI also imposed penalties on Ericsson India and two of its executives, Tej Nirmal Singh and Bharat Bandhu, under the Customs Act, 1962.

    Source: CESTAT Delhi

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  • CESTAT Mumbai Sets Aside Penalty on Courier Company

    CESTAT Mumbai Sets Aside Penalty on Courier Company

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 15.10.2025

    CESTAT Mumbai Sets Aside Penalty on Courier Company

    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 Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai, recently delivered a significant judgment in the appeals filed by Bombino Express Pvt. ​ Ltd. and its Director, against penalties imposed by the Commissioner of Customs (Appeals), Mumbai Zone III. ​ This decision, pronounced on October 7, 2025, marks a pivotal moment in the interpretation of penal provisions under the Customs Act, 1962.

    Background of the Case

    The case originated from allegations of mis-declaration and undervaluation of goods imported through courier mode by M/s. ​ Smashing Traders Pvt. ​ Ltd., facilitated by Bombino Express Pvt. ​ Ltd. Investigations revealed discrepancies between the declared value of goods and their actual value, leading to penalties being imposed on Bombino Express Pvt. ​ Ltd. and Appellant under Sections 112(a), 112(b), and 114AA of the Customs Act, 1962. ​

    The penalties were based on claims that Bombino Express and Appellant were complicit in the smuggling activities orchestrated by M/s. ​ Smashing Traders Pvt. ​ Ltd. and its mastermind, Mr. Kuo Leong. ​ The authorities alleged that Bombino Express knowingly facilitated the clearance of undervalued goods and that Appellant was involved in the procurement and dispatch of these goods.

    Source: CESTAT Mumbai

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  • CESTAT Delhi Sets Aside Customs Duty Demand Over DFIA License Misuse Allegations

    CESTAT Delhi Sets Aside Customs Duty Demand Over DFIA License Misuse Allegations

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 14.10.2025

    CESTAT Delhi Sets Aside Customs Duty Demand Over DFIA License Misuse Allegations

    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 legal development, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Principal Bench, New Delhi, delivered a landmark judgment on October 13, 2025, in favor of M/s Lasco Chemie Pvt. Ltd. and its Director. ​ The case revolved around the alleged misuse of Duty-Free Import Authorization (DFIA) licenses for importing epoxy resin under the guise of impregnating resin. ​

    Background of the Case

    The case originated from a show-cause notice (SCN) issued by the Directorate General of Revenue Intelligence (DRI) on January 29, 2015. The SCN alleged that M/s Lasco Chemie Pvt. ​ Ltd. had fraudulently imported epoxy resin under DFIA licenses issued to Kanpur-based leather exporters. ​ The DRI claimed that the DFIA licenses permitted the import of impregnating resin, not epoxy resin, and accused the importer of misdeclaring the goods to claim duty exemptions under Notification No. ​ 98/2009-Customs dated September 11, 2009. ​

    The Joint Commissioner upheld the allegations in the SCN, confirming a demand of differential duty amounting to β‚Ή33,29,154, along with applicable interest and penalties under various sections of the Customs Act, 1962. The Commissioner (Appeals) later upheld this decision, leading the appellants to file an appeal with the CESTAT.

    Source: CESTAT Delhi

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  • CESTAT Mumbai- Customs Cannot Enhance Value Without Contemporaneous Data

    CESTAT Mumbai- Customs Cannot Enhance Value Without Contemporaneous Data

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 14.10.2025

    CESTAT Mumbai- Customs Cannot Enhance Value Without Contemporaneous Data

    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 ruling, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Mumbai, delivered a judgment on October 9, 2025, providing relief to Artex Textile Pvt Ltd in a series of customs appeals. The case revolved around the reassessment of imported polyester fabrics under Section 17(4) of the Customs Act, 1962, and the denial of benefits under the exemption notification for additional duty of customs. ​ This decision has far-reaching implications for importers and the interpretation of customs valuation rules and exemption notifications. ​

    Background of the Case

    Artex Textile Pvt Ltd, an importer of polyester fabrics, faced enhanced assessable values imposed by the proper officer under Section 17 of the Customs Act, 1962. ​ The reassessment was challenged by the importer, citing procedural lapses under Rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007. ​ Additionally, the denial of exemption benefits under Notification No. 30/2004-Central Excise was contested.

    Source: CESTAT Mumbai

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  • CESTAT Bangalore- Clerical Error in Shipping Bill Not a Ground for Confiscation or Penalty

    CESTAT Bangalore- Clerical Error in Shipping Bill Not a Ground for Confiscation or Penalty

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 14.10.2025

    CESTAT Bangalore- Clerical Error in Shipping Bill Not a Ground for Confiscation or Penalty

    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 ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Bangalore, has set aside the confiscation and penalty imposed on M/s. Avasarala Technologies Ltd., a 100% Export Oriented Unit (EOU). ​ The case revolved around alleged discrepancies in the export of engineering equipment, specifically parts of rubber processing machines. ​ The judgment highlights the importance of distinguishing between clerical errors and intentional misdeclarations in export documentation. ​

    Background of the Case

    The appellant, Avasarala Technologies Ltd., had filed three shipping bills for the export of parts of rubber processing machines. ​ During the examination of goods, discrepancies were noted in two shipping bills (Nos. ​ 4375372 and 4375056). ​ Against the declared 43 sets of parts, only 15 sets were found, resulting in a shortage of 28 sets. Additionally, a weight discrepancy of 353 kgs was observed. ​ This led to the issuance of a show-cause notice proposing confiscation of goods under Section 113(h)(i) of the Customs Act, 1962, and the imposition of penalties under Section 114(iii). ​

    The adjudicating authority confiscated the goods valued at Rs. ​ 12,98,464, imposed a fine of Rs. ​ 3 lakhs in lieu of confiscation, and levied a penalty of Rs. ​ 2 lakhs. ​ The Commissioner (Appeals) upheld this decision, prompting the appellant to approach the Tribunal.

    Source: CESTAT Bangalore

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  • CESTAT Delhi Sets Aside Confiscation and Penalties in Export Valuation Dispute

    CESTAT Delhi Sets Aside Confiscation and Penalties in Export Valuation Dispute

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 13.10.2025

    CESTAT Delhi Sets Aside Confiscation and Penalties in Export Valuation Dispute

    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 Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, recently delivered a significant judgment in the case of Emerald Overseas vs. ​ Principal Commissioner of Customs (Customs Appeal No. ​ 51100 of 2022). ​ This decision, dated October 1, 2025, addresses critical issues surrounding the valuation of export goods and the liability of such goods to confiscation under the Customs Act, 1962. The ruling provides much-needed clarity for exporters and customs authorities alike.

    Background of the Case

    Emerald Overseas, the appellant, had filed eight shipping bills on June 12, 2017, to export garments under a claim of drawback. ​ The declared Free on Board (FOB) value of the goods was β‚Ή4,00,54,751, with a corresponding drawback claim of β‚Ή39,35,402.37. ​ However, customs authorities suspected overvaluation of the goods to fraudulently claim a higher drawback. ​ Following an investigation, the Additional Commissioner re-determined the FOB value to β‚Ή61,36,200 and reduced the admissible drawback to β‚Ή6,02,654. ​ The goods were confiscated under Section 113(i) of the Customs Act, and penalties were imposed under Sections 114(iii) and 114AA.

    Source: CESTAT Delhi

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  • CESTAT Allahabad clarified that the word “or” in Section 114A is disjunctive not interchangeable with “and”

    CESTAT Allahabad clarified that the word “or” in Section 114A is disjunctive not interchangeable with “and”

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 13.10.2025

    CESTAT Allahabad clarified that the word “or” in Section 114A is disjunctive not interchangeable with “and”

    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 ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Allahabad, has dismissed an appeal filed by the Revenue, affirming the principles laid down by the Karnataka High Court regarding the interpretation of Section 114A of the Customs Act, 1962. This decision reiterates the importance of statutory interpretation and sets a precedent for similar cases in the future. ​

    Background of the Case

    The case arose from an appeal filed by the Commissioner of Customs, Noida, challenging the non-imposition of penalty on the interest amount under Section 114A of the Customs Act, 1962. ​ The respondent, M/s Royal Steel Trading, had imported goods from Malaysia under various Bills of Entry and claimed exemption under the Free Trade Agreement (FTA) based on a Certificate of Origin. ​ However, upon verification, the certificate was found to be fake, leading to the issuance of a Show Cause Notice and subsequent adjudication. ​

    The adjudicating authority ordered the confiscation of goods valued at Rs. ​ 1,03,53,747, imposed a redemption fine of Rs. 8,00,000, confirmed the demand for customs duty of Rs. ​ 10,07,937 along with applicable interest, and imposed penalties under Sections 114A and 114AA of the Customs Act. However, no penalty was imposed on the interest amount under Section 114A, which became the subject of the Revenue’s appeal.

    Source: CESTAT Allahabad

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  • CESTAT Hyderabad Sets Aside Revocation of Customs Broker License

    CESTAT Hyderabad Sets Aside Revocation of Customs Broker License

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 13.10.2025

    CESTAT Hyderabad Sets Aside Revocation of Customs Broker License

    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, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Hyderabad, has set aside the revocation of the Customs House Agent (CHA) license of M/s SK International. The case, which revolved around allegations of misdeclaration of goods during export, highlights the importance of due process and evidence in disciplinary actions against Customs Brokers. ​

    Background of the Case

    M/s SK International, a Customs House Agent, faced allegations of contravening several regulations under the Customs House Agents Licensing Regulations (CHALR), 2004, and Customs Brokers Licensing Regulations (CBLR), 2013. ​ The accusations stemmed from their involvement in filing shipping bills for exporters allegedly attempting to export fertilizer items disguised as β€˜Cephalexin Monohydrate’ to claim undue drawback benefits. ​

    The Commissioner of Customs, Hyderabad, issued a Show Cause Notice (SCN) and subsequently revoked the CHA license of M/s SK International, citing violations of obligations under various regulations. ​ Aggrieved by this decision, the appellant approached the Tribunal, challenging the legality of the revocation.

    Source: CESTAT Hyderabad

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  • CESTAT Delhi- Refund of SAD Cannot Be Denied on Limitation Grounds

    CESTAT Delhi- Refund of SAD Cannot Be Denied on Limitation Grounds

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 11.10.2025

    CESTAT Delhi- Refund of SAD Cannot Be Denied on Limitation Grounds

    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 ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Principal Bench, New Delhi, has delivered a judgment that brings clarity to the contentious issue of the time limit for claiming refunds of Special Additional Duty (SAD) under Notification No. ​ 102/2007-Cus. This decision, pronounced on October 9, 2025, in the case of M/s Arjun Enterprises Pvt. ​ Ltd. vs. Commissioner of Customs (Appeals), New Delhi, is a landmark for importers seeking refunds of SAD.

    Background of the Case

    The appellant, M/s Arjun Enterprises Pvt. ​ Ltd., had filed a refund claim of Rs. ​ 1,91,363/- on July 26, 2018, for the SAD paid on imported goods under a Bill of Entry dated July 2, 2016. However, the claim was rejected by the adjudicating authority on the grounds of limitation, as the refund was filed beyond one year from the date of payment of the duty. ​ This rejection was upheld by the Commissioner (Appeals), prompting the appellant to approach the Tribunal. ​ The crux of the dispute revolved around whether the one-year limitation period for filing a refund claim should be calculated from the date of payment of SAD or from the date of sale of the imported goods.

    Source: CESTAT Delhi

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