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Tag: #CESTATChennai

  • CESTAT Chennai Quashes β‚Ή10 Lakh Penalty on Freight Forwarding Executive

    CESTAT Chennai Quashes β‚Ή10 Lakh Penalty on Freight Forwarding Executive

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 02.07.2025

    CESTAT Chennai Quashes β‚Ή10 Lakh Penalty on Freight Forwarding Executive

    The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai has set aside a penalty of β‚Ή10 lakhs imposed on Appellant, Assistant Manager-Sales at Al-Barrak Shipping Agencies Pvt. Ltd., in a red sanders smuggling case. The Tribunal ruled that there was no evidence of abetment or knowledge on the part of the appellant in the attempted illegal export of red sanders, a prohibited item.

    Background of the Case

    • A consignment falsely declared as β€œRagi” was intercepted by the DRI at Chennai Port.
    • Upon inspection, red sander logsβ€”a prohibited export itemβ€”were discovered instead.
    • The shipping bill was filed by a CHA on behalf of M/s A.I Enterprises, and Shri Elango had facilitated documentation and logistics.
    • The adjudicating authority imposed a penalty of β‚Ή10,00,000 on Appellant under Section 114(i) of the Customs Act, 1962, alleging abetment of smuggling.

    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 Upholds Classification of Tomato Dry Flavour Under CTH 3302

    CESTAT Chennai Upholds Classification of Tomato Dry Flavour Under CTH 3302

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 30.06.2025

    CESTAT Chennai Upholds Classification of Tomato Dry Flavour Under CTH 3302

    The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai, has allowed the appeal of M/s Symrise Pvt. Ltd., ruling that the imported product β€œTomato Dry Flavour” is correctly classifiable under Customs Tariff Heading (CTH) 3302 1010 as an odoriferous substance, and not under CTH 2106 9060 as previously contended by customs authorities.

    The Tribunal’s Final Order No. 40499/2023 dated 28.06.2023, sets aside the earlier denial of concessional basic customs duty (BCD) under Notification No. 21/2002, Sl. No. 119.

    Background of the Case

    • Symrise Pvt. Ltd. imported Tomato Dry Flavour and classified it under CTH 3302 1010, claiming a 10% BCD exemption.
    • The Revenue reclassified the product under CTH 2106 9060 (food preparations not elsewhere specified), triggering a demand for differential duty under Section 28 of the Customs Act, 1962.
    • The Commissioner (Appeals) upheld the reclassification, prompting the present appeal before CESTAT.

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

    Source: CESTAT Chennai

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  • CESTAT Chennai- No Misdeclaration in Buff Sole Leather Export

    CESTAT Chennai- No Misdeclaration in Buff Sole Leather Export

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 28.06.2025

    CESTAT Chennai- No Misdeclaration in Buff Sole Leather Export

    The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai, in its Final Order No. 40667/2025 dated 25.06.2025, ruled in favour of M/s. Welfare Leather Co. by setting aside the confiscation, redemption fine, and penalty imposed on the alleged misdeclaration of leather goods.

    Background:

    Welfare Leather had filed a drawback shipping bill for the export of Buff Sole Leather, which was subjected to inspection and testing by the Central Leather Research Institute (CLRI). The CLRI report concluded that the leather did not conform to the prescribed thickness (less than 3mm) and apparent density (less than 0.9 gm/cc) as per DGFT Public Notice No. 21/2009-14 dated 01.12.2009.

    Relying on this report, the adjudicating authority ordered the confiscation of the goods valued at β‚Ή3,02,206.39, imposed a redemption fine of β‚Ή25,000 under Section 125 of the Customs Act, and levied a penalty of β‚Ή5,000 under Section 114(ii).

    The Commissioner (Appeals) upheld the adjudication, leading the appellant to file the current appeal before CESTAT Chennai.

    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 Quashes Penalties on Customs Broker in Export Overvaluation

    CESTAT Chennai Quashes Penalties on Customs Broker in Export Overvaluation

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 27.06.2025

    CESTAT Chennai Quashes Penalties on Customs Broker in Export Overvaluation

    The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai Bench, has quashed heavy penalties imposed on M/s. Cochin Air Cargo Clearing House and its partners. The Tribunal ruled that there was no substantive evidence of the Customs Broker’s connivance in the alleged overvaluation of goods intended for export or in the fraudulent MEIS claims.

    Background of the Case

    The case stemmed from an attempted export in June 2019 by M/s. Swiss Global, New Delhi, who sought to export substandard β€œair inlet automobile spare parts” valued at β‚Ή3.46 crore through the Trichy Air Cargo Terminal. The shipments, declared under CTH 84212300, were allegedly overvalued to fraudulently claim Merchandise Exports from India Scheme (MEIS) benefits and IGST refunds.

    The customs authorities at Trichy initiated an investigation based on specific intelligence and seized the export cargo. A Show Cause Notice was issued, followed by a harsh Order-in-Original dated 30.06.2020 imposing the following penalties:

    • β‚Ή3 crore on Cochin Air Cargo Clearing House (Cochin unit)
    • β‚Ή3 crore on its Trichy branch
    • β‚Ή2 crore each on its Managing Partner and Manager

    The department invoked Sections 114(iii), 114AA, and 147(3) of the Customs Act, 1962, treating the Customs Broker and its partners as β€œdeemed exporters” liable for the attempted fraudulent export.

    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 Finished Leather Export Criteria

    CESTAT Chennai Clarifies Finished Leather Export Criteria

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 24.06.2025

    CESTAT Chennai Clarifies Finished Leather Export Criteria

    The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai, allowed the appeal of M/s Nabisha Leathers and set aside the imposition of export duty, penalty, and fine imposed for alleged export of β€œunfinished leather.” The case revolved around a nuanced interpretation of DGFT’s Public Notice on finished leather norms and marks a vital precedent on how such technical regulations should be interpreted.

    Background of the Case

    • Nabisha Leathers filed a shipping bill in March 2010 to export 37 cartons of β€œGoat Shoe Suede Upper Leather.”
    • A leather expert from Customs flagged 13 cartons of grey-coloured leather, suspecting non-compliance with DGFT Public Notice No. 21/2009-14.
    • A sample was sent to the Central Leather Research Institute (CLRI), which reported non-compliance citing “absence of snuffing” on the grain as the reason.
    • Based on the CLRI report, Customs:
      • Confiscated the consignment under Section 113(d) of the Customs Act, 1962.
      • Levied 60% export duty on the consignment.
      • Imposed a penalty of β‚Ή10,000.
      • Allowed redemption on fine of β‚Ή50,000.

    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 Customs Valuation and MIP Allegations

    CESTAT Chennai Rejected Customs Valuation and MIP Allegations

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 21.06.2025

    CESTAT Chennai Rejected Customs Valuation and MIP Allegations

    The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai, has set aside a total penalty of β‚Ή60 crores imposed on M/s. Sindhu Lakshmi Impex, its partners, and an associate entity, M/s. BNM Global Ventures, in a high-profile case concerning the import of black pepper from Sri Lanka. The tribunal quashed the Commissioner of Customs’ Order-in-Original dated 20.11.2020, which had imposed penalties and declared the imports as β€œprohibited” under customs law.

    Background of the Case

    • Imports in Dispute: 10,79,000 Kgs of Black Pepper imported under various Bills of Entry.
    • Allegations: The Department alleged overvaluation of imports from a related party in Sri Lanka (Lakshmi Export and Import), intended to circumvent the Minimum Import Price (MIP) of β‚Ή500/kg imposed by DGFT Notification No. 21/2015–20 dated 25.07.2018.
    • Key Charges: Improper imports, misdeclaration of value, and violation of Sections 111(m), 111(o), 112, and 114AA of the Customs Act, 1962.

    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 Upholds 90-Day Limit Under CBLR

    CESTAT Chennai Upholds 90-Day Limit Under CBLR

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 20.06.2025

    CESTAT Chennai Upholds 90-Day Limit Under CBLR

    Background

    M/s. Kailash Shipping Services Pvt. Ltd., a licensed Customs Broker, faced suspension of its broker license (License No. R-302/CHA) due to an alleged offence involving the use of a tampered self-sealing permission letter during export clearance at Chennai’s DPE facility in November 2024.

    Although the firm promptly admitted that the mistake was committed by a junior staff member (who was later suspended), the Customs Department issued:

    • Initial Suspension Order under Regulation 16(1) of the Customs Brokers Licensing Regulations (CBLR), 2018.
    • Continued Suspension Order under Regulation 16(2).
    • A subsequent Show Cause Notice (SCN) No. 09/2025 dated 17.03.2025 under Regulation 17(1), received by Customs on 09.12.2024.

    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 Rejects Allegations of Misdeclaration Involvement

    CESTAT Chennai Rejects Allegations of Misdeclaration Involvement

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 18.06.2025

    CESTAT Chennai Rejects Allegations of Misdeclaration Involvement

    The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai Bench has set aside penalties totaling β‚Ή60 lakh imposed under Section 112(b) of the Customs Act, 1962, for alleged involvement in the import of counterfeit branded goods.

    The Tribunal held that the appellant, being merely a shipping liner and not an importer or declarant, had neither custody nor knowledge of the goods’ contents, and hence could not be held liable for alleged misdeclaration or intellectual property violations.

    Background of the Case

    The Directorate of Revenue Intelligence (DRI), Tuticorin, intercepted three shipping containers based on intelligence inputs and discovered:

    • Mobile accessories and branded cosmetics (Olay, Lakme, Loreal, etc.) undeclared in the Bill of Lading
    • Branded shoes (Nike, Adidas, Reebok, etc.) suspected of violating IPR laws

    The goods were allegedly misdeclared in violation of:

    • Section 111(d) of the Customs Act
    • Legal Metrology Act, 2009
    • Drugs and Cosmetics Act, 1940
    • Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007

    Subsequently, the Commissioner levied penalties of β‚Ή25 lakh, β‚Ή10 lakh, and β‚Ή25 lakh in three separate orders against Green Port Shipping Agencies under Section 112(b) for “dealing with goods liable to confiscation.”

    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 Rejects Customs Duty Demand on Finished Leather

    CESTAT Chennai Rejects Customs Duty Demand on Finished Leather

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 16.06.2025

    CESTAT Chennai Rejects Customs Duty Demand on Finished Leather

    The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai, has allowed a group of appeals filed by leather exporters including Sri Karpaga Leathers, Meenal Leather Exports, Blossom Leathers, and others, setting aside the entire demand of export duty, penalty, and confiscation orders issued by the Commissioner of Customs, Chennai-IV.

    Case Background: Misdeclaration of Leather Type Alleged

    The case pertained to exports of finished leather by multiple Chennai-based exporters. Customs authorities alleged that these exporters had:

    • Misdeclared semi-finished leather as finished leather, and
    • Manipulated test samples to obtain a favorable certificate from CLRI (Central Leather Research Institute).

    The Revenue’s primary contention was that:

    • Exporters evaded 60% ad valorem export duty on unfinished leather.
    • Wrongful duty drawback and incentives were claimed.
    • Test reports were manipulated by switching samples.

    Based on this, the Department issued Show Cause Notices and passed Orders-in-Original invoking Sections 113(i), 114(ii), 114AA, 125, and 28(4) of the Customs Act, 1962.

    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- Royalty Payments Not Dutiable Under Customs Valuation Rules

    CESTAT Chennai- Royalty Payments Not Dutiable Under Customs Valuation Rules

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 14.06.2025

    CESTAT Chennai- Royalty Payments Not Dutiable Under Customs Valuation Rules

    In the case of M/s. KAMAZ Motors Ltd. vs. Principal Commissioner of Customs, Chennai-II. The case revolved around the contentious inclusion of royalty payments in the assessable value of imported CKD kits under Rule 10 of the Customs Valuation Rules, 2007.

    Case Background

    KAMAZ Motors Ltd., formerly Kamaz Vectra Motors Ltd., imported CKD kits for manufacturing heavy-duty trucks in India from its related foreign supplier M/s. CJSC Kamaz Foreign Trade Company, Russia. The Customs authorities had provisionally assessed the imports and later issued a Show Cause Notice proposing to add royalty of USD 450 per CKD kitβ€”paid to another group entity M/s. OJSC Kamaz Inc.β€”to the assessable value, alleging it to be a condition of sale.

    The Department relied on Rule 10(1)(c) and 10(1)(e) of the Customs Valuation Rules, 2007, stating that royalty payments were directly linked to the import of CKD kits and therefore must be included in the transaction value.

    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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