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Tag: #CESTATChennai

  • CESTAT Chennai Sets Aside Misclassification Allegations​

    CESTAT Chennai Sets Aside Misclassification Allegations​

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 10.09.2025

    CESTAT Chennai Sets Aside Misclassification 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 victory for M/s. Gravity Ventures Pvt. ​ Ltd., the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai, has set aside allegations of misclassification and misdeclaration of imported goods. The case revolved around the classification of non-woven interlining materials imported by the company, which were detained by the Customs Department, leading to a prolonged legal battle. ​

    Background of the Case

    Gravity Ventures had filed Bill of Entry No. ​ 7384974 dated 02.04.2020 for the import of various non-woven interlining materials. ​ The company classified the goods under specific Customs Tariff Headings (CTH) based on the Country of Origin Certificate and invoices provided by the foreign supplier. ​ The Customs Department, however, disputed the classification and proposed alternative CTHs, leading to demands for differential duty, penalties, and fines. ​

    The department alleged that the company had misdeclared the goods to evade customs duty. ​ This resulted in the detention of the goods and subsequent provisional release only after the company filed writ petitions before the Hon’ble High Court of Madras. ​ The High Court directed the Customs Department to provisionally release the goods upon execution of a bond and bank guarantee.

    Source: CESTAT Chennai

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  • CESTAT Chennai Rules in Favor of M/s Zibal Exim: Classification and Valuation of Imported Black Sand Upheld

    CESTAT Chennai Rules in Favor of M/s Zibal Exim: Classification and Valuation of Imported Black Sand Upheld

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 04.09.2025

    CESTAT Chennai Rules in Favor of M/s Zibal Exim: Classification and Valuation of Imported Black Sand Upheld​ ​ ​ ​

    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.

    Introduction:

    This case pertains to Customs Appeal No. 42037 of 2015 filed by M/s Zibal Exim against the Order-in-Appeal No. 118/2014-TTN(CUS) dated 14.10.2014, which upheld the Order-in-Original No. 40/2013 dated 07.11.2013. The dispute arose over the classification, valuation, and eligibility for concessional duty of 106 tons of “Black Sand” imported by the appellant from Sierra Leone.

    The Customs Department classified the goods as Quartz Sand under CTH 2505 1020, denied the concessional duty under Notification No. 12/2012, enhanced the value of the goods, and imposed fines and penalties. The appellant contested these findings, asserting that the goods were Rutile-bearing sand and should be classified under CTH 2614 0090 as Titanium Ore.

    Source: CESTAT Chennai

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  • CESTAT Chennai Confirms Classification and Exemption Eligibility for Float Glass Imports from ASEAN

    CESTAT Chennai Confirms Classification and Exemption Eligibility for Float Glass Imports from ASEAN

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 03.09.2025

    CESTAT Chennai Confirms Classification and Exemption Eligibility for Float Glass Imports from ASEAN​ ​ ​ ​ ​

    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), Chennai, has ruled in favor of M/s. Float Glass Centre, a regular importer of Clear Float Glass (CFG), in a case concerning the classification of imported goods and the denial of exemption benefits under Notification No. 46/2011-Cus dated 01.06.2011. ​ This decision, pronounced on September 2, 2025, sets a significant precedent for importers navigating complex classification disputes and exemption claims.

    Background of the Case

    M/s. Float Glass Centre, based in Chennai, imports Clear Float Glass with an absorbent layer, which they classify under Customs Tariff Heading (CTH) 7005 1090. ​ This classification entitles them to a β€˜NIL’ rate of Basic Customs Duty (BCD) under Sl. ​ No. 934 of Notification No. ​ 46/2011-Cus, provided the goods are imported from ASEAN countries. ​ However, the Assessing Officer denied this classification, citing discrepancies in the Country-of-Origin certificate, which mentioned a different CTH (7005 2990). ​ Consequently, the appellant filed bills of entry under protest and challenged the denial of exemption benefits before the Commissioner of Customs (Appeals), who rejected their claims. This led to the present appeals before the Tribunal.

    Source: CESTAT Chennai

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  • CESTAT Chennai Accepts Declared Value and Sets Aside Confiscation and Penalty for LED Screen Imports

    CESTAT Chennai Accepts Declared Value and Sets Aside Confiscation and Penalty for LED Screen Imports

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 29.08.2025

    CESTAT Chennai Accepts Declared Value and Sets Aside Confiscation and Penalty for LED Screen Imports

    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, and Service Tax Appellate Tribunal (CESTAT), Chennai, has delivered justice to M/s. Sureshkanna Video & Photo, a Chennai-based importer, by setting aside the impugned Order-in-Appeal passed by the Commissioner of Customs (Appeals-II). ​ This case highlights the importance of adhering to principles of natural justice and the procedural requirements under the Customs Valuation Rules.

    Background of the Case

    M/s. Sureshkanna Video & Photo imported LED screen components from China, declaring a value of Rs. ​ 19,59,313/- (US $42,441). ​ However, based on intelligence, the Special Intelligence and Investigation Branch (SIIB) alleged misdeclaration and undervaluation of the goods. ​ During a search of the proprietor’s premises, an unsigned draft contract was retrieved, which the authorities relied upon to reject the declared value and re-determine it at Rs. ​ 32,75,596/-. The goods were confiscated, and penalties were imposed under Sections 112(a) and 114AA of the Customs Act, 1962. ​

    The appellant challenged the findings, arguing that the unsigned contract was merely a draft and not the actual sales contract. ​ Despite repeated requests, the appellant was denied access to the unsigned contract and the opportunity for cross-examination, raising serious concerns about the violation of natural justice.

    Source: CESTAT Chennai

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  • CESTAT Chennai Quashes β‚Ή14.95 Lakh Late Fee on Delay in Filling Bill of Entry​

    CESTAT Chennai Quashes β‚Ή14.95 Lakh Late Fee on Delay in Filling Bill of Entry​

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 26.08.2025

    CESTAT Chennai Quashes β‚Ή14.95 Lakh Late Fee on Delay in Filling Bill of Entry​ ​ ​ ​

    In a recent decision by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai, the imposition of a late fee of Rs. 14,95,000 under Section 46(3) of the Customs Act, 1962, was set aside. This case, involving M/s. ​ ECOM Gill Coffee Trading Pvt. ​ Ltd., highlights the importance of considering the circumstances leading to delays in filing Bills of Entry and the need for judicious application of late fees. ​

    Case Background

    The dispute arose when M/s. ​ Vazhavilla Cashews, Kollam, the original importer, failed to clear a consignment of dried raw cashew nuts. ​ The goods were subsequently sold on a high-seas basis to M/s. ​ Ambalakkara Cashews, who filed a Bill of Entry on 12.08.2017. ​ However, due to financial issues, the shipper recalled the original documents and identified M/s. ECOM Gill Coffee Trading Pvt. ​ Ltd. as the new buyer.

    The procedural delays began when the new buyer applied for an amendment to the Import General Manifest (IGM) on 03.11.2017. ​ The amendment was approved on 12.12.2017, and the earlier Bill of Entry was canceled on 09.01.2018. ​ The new Bill of Entry was filed promptly on 12.01.2018. ​ Despite these efforts, the Customs Department imposed a late fee, which was upheld by the Commissioner (Appeals). ​ This led the appellant to approach the Tribunal.

    This Article has been written by Shri Ravi Shekhar Jha, Advocate Delhi High Court based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

    Source: CESTAT Chennai

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  • CESTAT Chennai Rejected CB License revocation but upholds Penalty on the Customs Broker

    CESTAT Chennai Rejected CB License revocation but upholds Penalty on the Customs Broker

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 25.08.2025

    CESTAT Chennai Rejected Revenue Appeal and Upholds Penalty on Customs Broker ​ ​ ​ ​ ​ ​

    In a significant ruling, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Chennai, has dismissed the appeal filed by the Revenue against the penalty imposed on M/s. ​ Allwin Cargo Services, a Customs Broker (CB). ​ The case revolved around alleged violations of the Customs Brokers Licensing Regulations, 2013 (CBLR, 2013), and the Tribunal’s decision highlights the importance of proportionality in adjudicating penalties under regulatory frameworks. ​

    Background of the Case

    The case originated from an investigation by the Directorate of Revenue Intelligence (DRI), Chennai, which uncovered smuggled cigarettes worth Rs. ​ 4.13 crore in a consignment declared as “Low Melting Steel Bundle Scrap.” While the live consignment was linked to another Customs Broker, Sameer Logistics Pvt. ​ Ltd., the investigation revealed that M/s. Allwin Cargo Services had handled past consignments allegedly adopting similar methods of smuggling. ​ A Show Cause Notice was issued to M/s. ​ Allwin Cargo Services, alleging violations of CBLR, 2013, including non-verification of Importer Exporter Code (IEC) details and coordination with unauthorized individuals. ​ The Adjudicating Authority imposed a penalty of Rs. ​ 50,000 under Regulation 18 of CBLR, 2013, but did not revoke the CB’s license or forfeit the security deposit.

    This Article has been written by Shri Ravi Shekhar Jha, Advocate Delhi High Court based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

    Source: CESTAT Chennai

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  • CESTAT Chennai- Customs authorities cannot independently demand IGST without DGFT recalling

    CESTAT Chennai- Customs authorities cannot independently demand IGST without DGFT recalling

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 23.08.2025

    CESTAT Chennai- Customs authorities cannot independently demand IGST without DGFT recalling ​ ​ ​ ​ ​ ​

    In a significant ruling, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Chennai, has delivered a judgment that provides much-needed clarity and relief to importers under the Advance Authorization Scheme (AAS). The case involved M/s. ​ Suryadev Alloys and Power (P) Ltd., which challenged the imposition of IGST, interest, redemption fine, and penalty for alleged violations of the “pre-import condition” during the GST transition phase. ​ The tribunal’s decision has far-reaching implications for importers and exporters navigating the complexities of customs law and GST compliance.

    Background of the Case

    The dispute arose from imports made by M/s. Suryadev Alloys under the Advance Authorization Scheme between October 13, 2017, and January 9, 2019. ​ The appellant claimed IGST exemption under Customs Notification No. ​ 18/2015-Cus, even after the introduction of the “pre-import condition” via Notification No. ​ 79/2017-Cus. The customs authorities alleged non-compliance with the pre-import condition and issued a demand for IGST, interest, redemption fine, and penalty. ​ The appellant argued that the pre-import condition was impossible to fulfill for authorizations issued before October 13, 2017, as exports had already been completed prior to imports. ​ Additionally, the appellant highlighted that the jurisdictional DGFT had issued redemption letters for all Advance Authorizations, confirming the fulfillment of export obligations.

    This Article has been written by Shri Ravi Shekhar Jha, Advocate Delhi High Court based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

    Source: CESTAT Chennai

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  • CESTAT Chennai Clarifies Law on Validity of DEPB Licences for Innocent Buyers

    CESTAT Chennai Clarifies Law on Validity of DEPB Licences for Innocent Buyers

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 22.08.2025

    CESTAT Chennai Clarifies Law on Validity of DEPB Licences for Innocent Buyers​ ​ ​

    On August 21, 2025, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai, delivered a significant judgment in Customs Appeal Nos. 40971 and 41142 of 2015. ​ This decision, involving The India Cements Ltd. and Seshasayee Paper and Boards Ltd., has far-reaching implications for importers who unknowingly purchase duty entitlement scrips obtained fraudulently by the original license holders. ​

    Background of the Case

    The appeals arose from Order-in-Original No. ​ 144/2015 issued by the Commissioner of Customs, Chennai. ​ The case revolved around the fraudulent acquisition of DEPB (Duty Entitlement Pass Book) licenses by CEEAN Commerce (P) Ltd., Kolkata, which were later sold to innocent transferee importers, including the appellants. ​ These licenses were used to avail customs duty exemptions during imports. The Customs authorities, after investigation, alleged that the licenses were obtained through misrepresentation and fraud. ​ Consequently, they demanded duty along with interest and imposed penalties under Section 114A of the Customs Act, 1962. ​ Aggrieved by this decision, the appellants approached the Tribunal.

    This Article has been written by Shri Ravi Shekhar Jha, Advocate Delhi High Court based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

    Source: CESTAT Chennai

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

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

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 20.08.2025

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

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

    Background of the Case

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

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

    This Article has been written by Shri Ravi Shekhar Jha, Advocate Delhi High Court based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

    Source: CESTAT Chennai

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  • CESTAT Chennai- Delay in EODC Issuance Beyond Importer’s Control

    CESTAT Chennai- Delay in EODC Issuance Beyond Importer’s Control

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 13.08.2025

    CESTAT Chennai- Delay in EODC Issuance Beyond Importer’s Control

    In a significant ruling, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Chennai, has set aside a duty demand against M/s. Mohan Breweries & Distilleries Ltd. under the Export Promotion Capital Goods (EPCG) Scheme. ​ The case highlights the importance of procedural fairness and the role of government authorities in facilitating compliance with export obligations. ​

    Background of the Case

    M/s. Mohan Breweries & Distilleries Ltd. was issued an EPCG license for importing capital goods at a concessional duty rate under Customs Notification No. 55/2003. The company undertook to fulfill export obligations equivalent to eight times the duty saved within eight years. ​ However, the Customs Department alleged non-compliance due to the non-submission of the Export Obligation Discharge Certificate (EODC) and issued a demand for Rs. ​ 8,18,647/- along with applicable interest. ​ The appellant contended that they had fulfilled their export obligations and had applied for the EODC with the Directorate General of Foreign Trade (DGFT). ​ Despite this, the Commissioner of Customs (Appeals-II) rejected their request to transfer the case to the call book and upheld the duty demand.

    This Article has been written by Shri Ravi Shekhar Jha, Advocate Delhi High Court based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

    Source: CESTAT Chennai

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