𝐀𝐚𝐝𝐫𝐢𝐤𝐚𝐚 𝐋𝐞𝐠𝐚𝐥 𝐒𝐞𝐫𝐯𝐢𝐜𝐞𝐬 (𝐀𝐋𝐒)

Tag: #CESTATKolkata

CESTAT Kolkata Sets Aside Customs Broker’s License Revocation
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 24.03.2026

CESTAT Kolkata Sets Aside Customs Broker’s License Revocation

Adv Ravi Shekhar Jha

This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

In a significant ruling, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Kolkata, Eastern Zonal Bench, has set aside the revocation of the Customs Broker’s License of M/s. Just Logistics. The tribunal’s decision, delivered on March 19, 2026, highlights critical legal principles, including adherence to natural justice, the burden of proof, and the responsibilities of Customs Brokers under the Customs Brokers Licensing Regulations (CBLR), 2018. This case serves as a reminder of the importance of fair and transparent investigations and the need for authorities to avoid arbitrary and meritless actions.

Background of the Case

The case arose from allegations against M/s. Just Logistics, a Customs Broker, for purported violations of Regulations 10(d), 10(m), and 10(n) of the CBLR, 2018. The allegations stemmed from the export of undervalued “Human Hair (Unprocessed)” by M/s. S.S. Impex, an exporter for whom the appellant had facilitated eight shipments between December 2020 and January 2021. The authorities claimed that the exporter was non-existent and that the Customs Broker had acted as the exporter in the transactions.

The Principal Commissioner of Customs, Kolkata, issued an Order-in-Original on February 21, 2024, revoking the Customs Broker’s License, forfeiting the security deposit, and imposing a penalty of ₹50,000. The appellant challenged this order before the tribunal, asserting that the allegations were baseless and the disciplinary proceedings were conducted arbitrarily.

Key Allegations Against the Appellant

The authorities alleged that:
1. The exporter, M/s. S.S. Impex, was non-existent and could not be traced.
2. The goods exported were undervalued, as determined by a discreet market survey and an email from the Flex Council.
3. The Customs Broker violated the following provisions of the CBLR, 2018:
  - Regulation 10(d): Failure to advise the client to comply with the provisions of the Customs Act and other allied regulations.
  - Regulation 10(m): Failure to discharge duties with utmost speed and efficiency.
  - Regulation 10(n): Failure to verify the correctness of the Importer Exporter Code (IEC), Goods and Services Tax Identification Number (GSTIN), and the functioning of the client at the declared address.
Appellant’s Defense

M/s. Just Logistics presented a robust defense, challenging the allegations on multiple grounds:
1. Existence of the Exporter:
  - The appellant provided evidence that M/s. S.S. Impex held valid government-issued documents, including an IEC and GSTIN, which were still active and operational.
  - The appellant submitted KYC documents, including the exporter’s registration certificates, bank account details, and government-issued identification, to establish the exporter’s existence.
2. Limited Role in Shipments:
  - The appellant argued that they were not the sole Customs Broker for the exporter. They provided a list of 184 shipments facilitated by other Customs Brokers for the same exporter, highlighting that the appellant had only handled eight shipments.
3. Compliance with Legal Obligations:
  - The appellant emphasized that they had fulfilled their obligations under Regulation 10(n) by verifying the exporter’s identity and functioning using reliable and authentic documents.
  - They argued that Customs Brokers are not required to physically verify the details of their clients, as long as reasonable precautions are taken.
4. High Court Intervention:
  - The appellant filed a writ petition before the Hon’ble High Court of Calcutta, which directed the authorities to complete the disciplinary proceedings within three months after appointing a new inquiry officer.
  - The High Court criticized the authorities for delaying the inquiry and deemed their actions arbitrary and mala fide.
Tribunal’s Observations

The tribunal made several critical observations during the proceedings:
1. Failure to Follow Natural Justice:
  - The authorities did not consider the appellant’s submissions and evidence, conducting the inquiry in a mechanical and arbitrary manner.
  - The inquiry officer’s report was deemed invalid due to its lack of proper reasoning and disregard for the appellant’s defense.
2. Lack of Evidence:
  - The Revenue failed to provide concrete evidence to substantiate its claims that the exporter was non-existent or that the Customs Broker acted as the exporter.
  - Allegations based on assumptions, hearsay, and unverified evidence were deemed insufficient to justify penal action.
3. Legal Precedents:
  - The tribunal referred to case laws, including Perfect Cargo & Logistics v. C.C. (Airport & General) and Kunal Travels (Cargo) v. CC (I & G), IGI Airport, New Delhi, which established that Customs Brokers are not required to physically verify their clients’ details and are only obligated to take reasonable precautions.
4. Criticism of Revenue’s Actions:
  - The tribunal criticized the authorities for failing to adhere to the timelines mandated by Regulation 17 of CBLR, 2018, and the High Court’s directions.
  - It noted that the authorities’ actions were discriminatory, as no action was taken against other Customs Brokers who had facilitated shipments for the same exporter.
Tribunal’s Decision

The tribunal ruled in favor of the appellant, setting aside the order of the lower authority. The key directives included:
1. Restoration of the Customs Broker’s License.
2. Return of the forfeited security deposit and penalty imposed on the appellant.
3. A strong admonition to the authorities to avoid meritless and frivolous litigation and focus on facilitating trade.
Conclusion

This case serves as a landmark judgment in the realm of trade facilitation and Customs Broker regulations. It underscores the importance of adhering to principles of natural justice, conducting thorough and unbiased investigations, and avoiding arbitrary actions. The tribunal’s decision not only restores the appellant’s license but also sends a clear message to authorities to act responsibly and ensure fair treatment of stakeholders in the trade ecosystem. This ruling is expected to strengthen the confidence of the exporting community in the regulatory framework and promote seamless trade practices.

Source: CESTAT Kolkata

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March 24, 2026
CESTAT Kolkata Ruled on Excise Duty Valuation for Steel Scrap Clearance
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 21.03.2026

CESTAT Kolkata Ruled on Excise Duty Valuation for Steel Scrap Clearance

Adv Ravi Shekhar Jha

This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, recently delivered a significant judgment in the case of M/s Steel Authority of India Limited (SAIL) vs. Commissioner of CGST & Central Excise, Bolpur. This case revolved around the valuation of steel scraps cleared by SAIL’s Durgapur Steel Plant (DSP) to its sister unit, Alloy Steel Plant (ASP), and independent buyers, and whether Rule 8 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000, was applicable in this scenario.

Background of the Case 

SAIL, a leading manufacturer of iron and steel products, operates several integrated steel plants across India, including the Durgapur Steel Plant (DSP) in West Bengal. DSP is registered under the Central Excise Act, 1944, and the Finance Act, 1994, for manufacturing and other activities. During the manufacturing process, steel scraps such as processed steel scraps, steel turnings, borings, and rejected wheels are generated. These scraps are cleared to external customers and sister units, including ASP, upon payment of appropriate excise duty.

The dispute arose when the Commissioner of Central Excise, Bolpur, issued a show-cause notice to SAIL on May 3, 2005, alleging that the company had undervalued the steel scraps cleared to its sister unit, ASP, during the financial years 2001-02 to 2003-04. The notice claimed that SAIL had contravened Rule 8 of the Valuation Rules, Section 4(1)(b) of the Central Excise Act, and other related provisions, resulting in an alleged duty evasion of ₹1,27,02,287. The Commissioner demanded recovery of the duty along with interest and imposed an equivalent penalty under Section 11AC of the Act.

SAIL contested the allegations, arguing that the valuation of the steel scraps was correctly determined under Rule 4 of the Valuation Rules, which applies to goods sold to independent buyers. The company maintained that the scraps were cleared to both external customers and sister units, and therefore, Rule 8, which applies only when goods are exclusively sold to sister units, was not applicable.

Key Issues in the Case 

The case raised several critical questions:
1. Applicability of Rule 8 of the Valuation Rules: Whether Rule 8, which mandates valuation based on 110%/115% of the cost of production, applies when goods are cleared to both independent buyers and sister units.
2. Revenue Neutrality: Whether the duty paid by SAIL was available as CENVAT credit to its sister unit, making the entire exercise revenue-neutral.
3. Limitation Period: Whether the extended period of limitation under the Proviso to Section 11A(1) of the Central Excise Act was applicable, given that the show-cause notice was issued beyond the prescribed one-year period.
Tribunal’s Observations and Judgment 

The Tribunal, comprising Hon’ble Mr. Ashok Jindal (Judicial Member) and Hon’ble Mr. K. Anpazhakan (Technical Member), made the following key observations:
1. Rule 8 Applicability: The Tribunal held that Rule 8 of the Valuation Rules is applicable only when the entire quantity of goods is cleared to sister units. Since SAIL had cleared steel scraps to both independent buyers and sister units, Rule 8 was not applicable. Instead, the transaction value should be determined under Rule 4, which is based on the price at which goods are sold to independent buyers.
2. Revenue Neutrality: The Tribunal noted that the duty paid by SAIL on the steel scraps cleared to its sister unit was available as CENVAT credit to the sister unit. This made the entire exercise revenue-neutral, as there was no loss of revenue to the government.
3. Limitation Period: The Tribunal observed that the show-cause notice was issued beyond the prescribed one-year period under Section 11A of the Act. The extended period of limitation could not be invoked as the Commissioner (Appeals) had already found that SAIL acted on a “bona fide belief” and did not have any intention to evade duty. The Tribunal emphasized that the condition precedent for invoking the extended limitation period under the Proviso to Section 11A(1) was not satisfied.
Tribunal’s Decision

Based on the above observations, the Tribunal concluded that:
- Rule 8 of the Valuation Rules was not applicable to the facts of the case.
- SAIL had correctly paid the duty on the steel scraps cleared to its sister unit.
- The demand for duty and penalty was unsustainable.
- The extended period of limitation could not be invoked.
The Tribunal set aside the impugned order and allowed SAIL’s appeal, granting consequential relief.

Key Takeaways

This judgment is a landmark decision that clarifies the applicability of Rule 8 of the Valuation Rules in cases where goods are cleared to both independent buyers and sister units. It also reinforces the principle of revenue neutrality, emphasizing that no duty demand can be sustained if the duty paid is available as CENVAT credit to the recipient unit. Additionally, the judgment highlights the importance of adhering to the limitation period under Section 11A of the Central Excise Act, especially in cases where there is no evidence of suppression or intent to evade duty.

Conclusion

The case of M/s Steel Authority of India Limited vs. Commissioner of CGST & Central Excise, Bolpur serves as a crucial precedent for manufacturers and tax practitioners dealing with valuation disputes under the Central Excise Act. It underscores the need for proper interpretation of valuation rules and the significance of revenue neutrality in excise duty matters. This judgment is a testament to the importance of adhering to established legal principles and ensuring fair treatment of taxpayers.

Source: CESTAT Kolkata

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March 21, 2026
CESTAT Kolkata Sets Aside Customs Duty and IGST Demand
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 20.03.2026

CESTAT Kolkata Sets Aside Customs Duty and IGST Demand

Adv Ravi Shekhar Jha

This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

In a significant ruling, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Eastern Zonal Bench, Kolkata, has delivered a judgment in favor of M/s. Imperial Fragrance & Flavours Pvt. Ltd. in Customs Appeal No. 75890 of 2023. The case revolved around the import of ‘Gurjon Oil’ and ‘Patchouli Oil’ from Indonesia, where the appellant sought exemption from Basic Customs Duty (BCD) under Notification No. 46/2011-Cus., as amended by Notification No. 82/2018-Cus., and faced a demand for differential Integrated Goods and Services Tax (IGST).

Background of the Case

M/s. Imperial Fragrance & Flavours Pvt. Ltd. imported ‘Gurjon Oil’ and ‘Patchouli Oil’ from Indonesia and filed Bill of Entry No. 4012164 dated 11.07.2019, claiming exemption from BCD under the aforementioned notifications. The goods were assessed, examined, and granted Out-of-Charge on 19.07.2019 after the submission of all required documents, including the certificate of origin and invoice.

However, during an audit in 2021, the Audit team raised objections, alleging that the appellant had paid IGST at 12% instead of the applicable rate of 18%. The appellant acknowledged the error and expressed willingness to pay the differential IGST, requesting permission to file a supplementary Bill of Entry to claim input tax credit for the additional IGST paid. This request was denied.

Subsequently, a Show Cause Notice (SCN) was issued on 09.07.2021, challenging the classification of the imported goods and asserting that the appellant was ineligible for the concessional BCD rate. The SCN also demanded the differential IGST. The adjudicating authority confirmed the demand for BCD, SWS, and IGST, which was upheld by the Commissioner of Customs (Appeals). Aggrieved by the decision, the appellant approached the Tribunal.

Key Arguments Presented

Appellant’s Submissions
1. Proper Documentation and Classification: The appellant argued that the Bill of Entry was assessed and cleared after thorough examination by Customs authorities, who were satisfied with the classification and documentation provided.
2. Eligibility for BCD Exemption: The appellant contended that the imported goods fell under Chapter Heading 3301, which qualifies for concessional BCD rates under the relevant notifications.
3. IGST Payment Error: The appellant admitted to a genuine error in paying IGST at 12% instead of 18%. They emphasized their willingness to pay the differential IGST and requested permission to file a supplementary Bill of Entry to claim input tax credit, which was denied.
4. Revenue Neutrality: The appellant argued that the differential IGST payment would result in a revenue-neutral situation, as they would be eligible to claim input tax credit for the additional IGST paid.
Revenue’s Submissions
1. Incorrect Classification: The Revenue argued that the classification adopted by the appellant was incorrect, making them ineligible for the concessional BCD rate.
2. IGST Payment Error: The Revenue contended that the appellant had admitted to paying IGST at an incorrect rate, justifying the demand for differential IGST.
Tribunal’s Observations and Decision 

After hearing both sides and reviewing the appeal papers and supporting documents, the Tribunal made the following observations:
1. BCD and SWS Demand: The Tribunal noted that the Customs authorities had assessed and cleared the goods after verifying the classification and documentation, including the certificate of origin. The relevant notifications provide BCD exemption for goods under Chapter Heading 3301, irrespective of sub-headings. Therefore, the Tribunal found no merit in the confirmed demand for BCD and SWS and set it aside.
2. Differential IGST Demand: The Tribunal acknowledged the appellant’s genuine error in paying IGST at 12% instead of 18%. It emphasized that the appellant had demonstrated their bona fides by agreeing to pay the differential IGST and requesting permission to file a supplementary Bill of Entry to claim input tax credit. The Tribunal highlighted that input tax credit is an indefeasible right of the appellant, and the denial of this request was unjustified.
3. Revenue Neutrality: Citing multiple case laws, including M/s. Chiripal Polyfilms Ltd. v. Commissioner of C.Ex. & S.T., Vadodara-I, the Tribunal reiterated that when differential duty or tax results in a revenue-neutral situation, the demand is not legally sustainable. The Tribunal emphasized that the appellant’s case was revenue-neutral, as the differential IGST paid would have been available as input tax credit.
Final Order

The Tribunal set aside the impugned order, allowing the appeal filed by M/s. Imperial Fragrance & Flavours Pvt. Ltd. The appellant was granted consequential relief as per law.

Key Takeaways
1. Importance of Proper Documentation: The Tribunal’s decision underscores the significance of maintaining accurate and complete documentation during imports to substantiate claims for exemptions and concessions.
2. Revenue Neutrality Principle: The judgment reaffirms the principle that demands for differential duty or tax are not sustainable in cases where the payment results in a revenue-neutral situation.
3. Right to Input Tax Credit: The Tribunal emphasized that input tax credit is an indefeasible right of the assessee, and authorities should consider requests to facilitate its utilization.
This ruling serves as a precedent for similar cases, highlighting the importance of procedural fairness and adherence to established legal principles in customs and tax disputes.

Source: CESTAT Kolkata

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March 20, 2026
CESTAT Kolkata Sets Aside Penalties in SEIS Scrip Misclassification
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 17.03.2026

CESTAT Kolkata Sets Aside Penalties in SEIS Scrip Misclassification

Adv Ravi Shekhar Jha

This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, recently delivered a significant judgment in the case of M/s. Amity Software Systems Ltd. & Appellant vs. Commissioner of Customs (Port), Kolkata. This case revolved around the classification of exported services under the Service Export from India Scheme (SEIS) and the imposition of penalties under Section 114AA of the Customs Act, 1962. The Tribunal’s decision has set a precedent for cases involving disputes over service classifications and penalties.

Background of the Case

M/s. Amity Software Systems Ltd., a company engaged in providing Information Technology Software Services and implementation of IT services, claimed SEIS scrip benefits from the Directorate General of Foreign Trade (DGFT). These scrips, which are transferable, were sold to buyers. However, the Directorate of Revenue Intelligence (DRI), Ahmedabad, initiated an investigation into the company’s export activities.

The investigation revealed that the services exported by the appellant fell under Group/Division 84 of Annexure 1 of the Explanatory Notes to Provisional CPC issued by DGFT, rather than Group/Division 86, as claimed by the appellant. This distinction was crucial because services under Group 84 are not eligible for SEIS scrip benefits. Consequently, a Show Cause Notice was issued on June 27, 2022, alleging suppression of facts and improper claim of SEIS scrips.

Following due process, the Adjudicating Authority confirmed a customs duty demand of ₹1,08,14,291, along with a penalty of ₹25,00,000 against the appellant company and ₹5,00,000 against its Managing Director. Aggrieved by this decision, the appellants approached the Tribunal.

Arguments Presented by the Appellants 

The appellants, represented by their counsel, argued that:
1. Bonafide Belief in Classification: The company believed that the services rendered fell under Group 86, which includes legal, accounting, auditing, market research, management, and consulting services. They contended that the services were provided exclusively to foreign entities, with payments received in foreign exchange.
2. No Suppression of Facts: The appellants argued that all relevant details were disclosed to the DGFT and customs authorities, and there was no willful suppression of facts as alleged.
3. Payment of Confirmed Demand: To avoid prolonged litigation, the company paid the entire confirmed demand of ₹1,08,14,291 along with interest of ₹51,81,981. They also paid a penalty of ₹20,00,000 imposed by the DGFT under Section 11 of the Foreign Trade (Development and Regulation) Act, 1992.
4. Request for Penalty Waiver: The appellants contested only the penalties imposed under Section 114AA of the Customs Act, 1962, arguing that the issue was one of interpretation and no malafide intent could be attributed to them.
Arguments Presented by the Respondent

The respondent justified the confirmed demand and penalties, stating:
1. Admission of Suppression: The appellants did not contest the DGFT’s findings and paid the penalty imposed, which indicated an admission of suppression.
2. Incorrect Classification: The services exported by the appellants clearly fell under Group 84, making them ineligible for SEIS scrip benefits.
Tribunal’s Observations and Final Order 

After hearing both sides and reviewing the appeal papers, the Tribunal made the following observations:
1. Thin Line Between Group 84 and Group 86: The Tribunal noted that the difference between the descriptions under Group 84 and Group 86 was minimal, making it a matter of interpretation.
2. Bonafide Belief: The Tribunal acknowledged that the appellants could have reasonably believed their services fell under Group 86, given the thin line of distinction between the two groups.
3. Acceptance of DGFT’s Decision: The Tribunal observed that the appellants had accepted the DGFT’s decision and paid the penalty imposed without contesting it further.
4. Penalty Waiver: Considering the appellants’ bonafide belief, their payment of the confirmed demand and interest, and the penalty imposed by the DGFT, the Tribunal set aside the penalties of ₹25,00,000 on the appellant company and ₹5,00,000 on the Managing Director under Section 114AA of the Customs Act, 1962.
5. Consequential Relief: The Tribunal held that the appellants would be eligible for any consequential relief as per the law.
Key Takeaways

This judgment highlights several important aspects of customs and trade law:
1. Importance of Accurate Classification: The case underscores the criticality of correctly classifying services under the DGFT’s Explanatory Notes to Provisional CPC for claiming SEIS scrip benefits.
2. Bonafide Belief and Interpretation: The Tribunal’s decision demonstrates that penalties may be waived in cases where the issue arises from a genuine difference in interpretation and no malafide intent is established.
3. Acceptance of Liability: The appellants’ decision to pay the confirmed demand and interest without contesting it played a significant role in the Tribunal’s decision to waive the penalties.
4. Role of DGFT: The DGFT’s authority in determining the eligibility of services for SEIS scrip benefits was reaffirmed.
Conclusion

The CESTAT Kolkata’s decision in this case is a landmark ruling that provides clarity on the interpretation of service classifications under the DGFT’s Explanatory Notes to Provisional CPC. It also emphasizes the importance of transparency and good faith in dealings with customs and trade authorities. By setting aside the penalties, the Tribunal has reinforced the principle that genuine errors in interpretation should not be penalized harshly, provided there is no evidence of willful suppression or malafide intent. This judgment will serve as a guiding precedent for similar cases in the future.

Source: CESTAT Kolkata

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March 17, 2026
CESTAT Kolkata Clarifies Anti-Dumping Duty Applicability During Notification Gap Period
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 13.03.2026

CESTAT Kolkata Clarifies Anti-Dumping Duty Applicability During Notification Gap Period

Adv Ravi Shekhar Jha

This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) Kolkata recently delivered a landmark judgment in the case of M/s. SIBCO Overseas Pvt. Ltd. v. Commissioner of Customs (Port), Kolkata. This case revolved around the retrospective applicability of Anti-Dumping Duty (ADD) on imported PVC Flex Banner from China during a period when no provisional or definitive ADD notification was in force. The judgment provides critical insights into the legal framework governing ADD and its retrospective application under Indian law.

Background of the Case

M/s. SIBCO Overseas Pvt. Ltd. imported PVC Flex Banner from China on June 4, 2011, under Bill of Entry No. 3702906. At the time of import, no ADD notification was in force, as the provisional ADD imposed under Notification No. 79/2010-CUS dated July 30, 2010, had expired on January 29, 2011. Subsequently, Notification No. 82/2011-CUS dated August 25, 2011, imposed definitive ADD with retrospective effect for five years from July 30, 2010, the date of imposition of the provisional ADD.

The appellant challenged the retrospective applicability of the definitive ADD, arguing that no ADD notification was operative at the time of import. Additionally, the appellant raised concerns about the delayed finalization of the provisional assessment, which took over ten years to complete.

Key Legal Issues 

The case presented two primary legal questions:
1. Retrospective Applicability of ADD: Could definitive ADD be levied retrospectively during the gap period between the expiration of the provisional ADD and the issuance of the definitive ADD notification?
2. Delayed Finalization of Provisional Assessment: Was the delay in finalizing the provisional assessment legally permissible?
Legal Framework

The case involved the interpretation of several legal provisions, including:
- Section 18 of the Customs Act, 1962: Governs provisional assessment of duty and its finalization.
- Section 9A of the Customs Tariff Act, 1975: Provides for the imposition of ADD on dumped articles.
- Customs Tariff (Identification, Assessment, and Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995: Specifies the procedures for imposing ADD, including provisions for provisional and definitive duties.
- Customs (Finalization of Provisional Assessment) Regulations, 2018: Introduced timelines for finalizing provisional assessments.
Tribunal’s Observations

1. Retrospective Applicability of ADD 

The Tribunal relied heavily on the Supreme Court’s judgment in Commissioner of Customs, Bangalore v. G.M. Exports (2015), which categorically held that ADD cannot be levied during the “gap period” between the expiration of provisional ADD and the imposition of definitive ADD. The Court emphasized that retrospective levy of ADD is permissible only under specific circumstances outlined in Section 9A(3) of the Customs Tariff Act, and any attempt to levy ADD during the gap period would render the relevant provisions ultra vires.

The Tribunal also referred to other judicial precedents, including:
- Hi-tech Computers v. Commissioner of Customs, Bangalore (2023): Held that ADD cannot be levied during the gap period.
- Harsh Commodities Pvt. Ltd. v. Commissioner of Customs, Kandla (2020): Confirmed that ADD cannot be imposed during the lapse between provisional and definitive notifications.
- Forech India Ltd. v. Designated Authority (2018): Stated that ADD cannot be revived after its lapse without strict adherence to legal timelines.
2. Delayed Finalization of Provisional Assessment 

The Tribunal noted that while the delay in finalizing the provisional assessment was concerning, it could not be legally faulted because the Customs (Finalization of Provisional Assessment) Regulations, 2018, which introduced strict timelines for finalization, were not in force at the time of the import. The Tribunal also observed that the delay was partly attributable to the appellant’s delayed response to the authorities’ communications.

Key Takeaways from the Judgment
1. No ADD During Gap Period: The Tribunal reaffirmed that ADD cannot be levied during the gap period between the expiration of provisional ADD and the issuance of definitive ADD notification. This principle is in line with the Supreme Court’s judgment in G.M. Exports and India’s obligations under the WTO Anti-Dumping Agreement.
2. Retrospective Levy Requires Strict Compliance: The retrospective imposition of ADD is permissible only under the strict conditions outlined in Section 9A(3) of the Customs Tariff Act and the ADD Rules. Any deviation from these conditions renders the levy unsustainable.
3. Delayed Finalization of Provisional Assessments: While the Tribunal acknowledged the delay in finalizing the provisional assessment, it noted that the absence of strict timelines at the material time made it legally permissible. However, the Tribunal emphasized the importance of timely action by authorities to maintain trust in the system.
4. Jurisdiction of Tribunal Benches: The Tribunal clarified that its jurisdiction to hear appeals related to ADD is not restricted to Special Benches unless the appeal pertains specifically to the determination of the existence, degree, and effect of dumping under Section 9C(1) of the Customs Tariff Act.
Conclusion

The judgment in the case of M/s. SIBCO Overseas Pvt. Ltd. v. Commissioner of Customs (Port), Kolkata, is a significant development in the realm of anti-dumping law in India. It underscores the importance of adhering to legal provisions and timelines for the imposition and finalization of ADD. The Tribunal’s decision not only provides clarity on the retrospective applicability of ADD but also highlights the need for administrative efficiency in finalizing provisional assessments.

Source: CESTAT Kolkata

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March 13, 2026
CESTAT Kolkata Sets Aside Penalty on CHA
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 07.03.2026

CESTAT Kolkata Sets Aside Penalty on CHA

Adv Ravi Shekhar Jha

This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, recently delivered a significant judgment in the case of M/s Express Clearing Agency vs. Commissioner of Customs (Port), Kolkata. This case, registered as Customs Appeal No. 75407 of 2020, revolved around the imposition of a penalty of Rs. 3 lakhs on the appellant, M/s Express Clearing Agency, under Section 114AA of the Customs Act, 1962. The final order, numbered 75239/2026, was pronounced on February 13, 2026, by Hon’ble Member Judicial.

Background of the Case

M/s Express Clearing Agency, a Customs House Agent (CHA), was penalized for allegedly being involved in altering the classification of imported goods to favor the importer, Kejriwal Electronics Ltd. The case originated from proceedings against the importer, where a Show Cause Notice was also issued to the CHA. The adjudicating authority confirmed the demand against the importer and imposed penalties on both the importer and the CHA.

The appellant challenged the penalty before the Commissioner of Customs (Appeals), Kolkata, but the appeal was dismissed. Subsequently, the appellant approached the CESTAT, seeking relief on the grounds that the main importer’s appeal had already been decided in their favor by the Tribunal in Final Order No. 75653/2025 dated February 26, 2025.

Key Arguments Presented
1. Appellant’s Argument:
  - The appellant’s counsel, argued that the main issue of classification of goods had already been resolved in favor of the importer, Kejriwal Electronics Ltd., by the Tribunal in its earlier order.
  - The counsel contended that since the importer’s penalty and confirmed duty were set aside, the penalty imposed on the CHA should also be revoked.
2. Respondent’s Argument:
  - The respondent justified the penalty imposed on the CHA, alleging that the appellant played a role in altering the classification of goods to benefit the importer.
Tribunal’s Observations

The Tribunal carefully examined the case records and referred to its previous rulings, including Final Order No. 75653/2025 and other relevant case laws. The key findings were:
1. Classification of Goods:
  - The Tribunal reiterated its earlier decision that the imported goods, described as “multi-media speaker systems,” were correctly classified under Chapter Heading 8518, as their primary function was sound amplification. The department’s argument to classify the goods under Chapter Heading 8527 was rejected.
2. Precedents:
  - The Tribunal referred to similar cases, such as Logic India Trading Co. vs. Commissioner of Customs, Cochin and ONKYO SIGHT & SOUND INDIA PVT. LTD. vs. Commissioner of Customs, Chennai, where the classification of similar goods was upheld under Chapter Heading 8518.
3. Implications for the CHA:
  - Since the main importer’s appeal was allowed and the penalties imposed on them were set aside, the Tribunal found no merit in penalizing the CHA. The impugned order against M/s Express Clearing Agency was therefore set aside.
Final Decision

The Tribunal allowed the appeal filed by M/s Express Clearing Agency, setting aside the penalty of Rs. 3 lakhs imposed under Section 114AA of the Customs Act, 1962. The appellant was deemed eligible for consequential relief as per the law.

Significance of the Judgment

This judgment is a landmark decision for Customs House Agents (CHAs) and importers alike, as it underscores the importance of proper classification of goods under the Customs Act. The Tribunal’s reliance on established precedents and its detailed analysis of the classification issue highlight the importance of adhering to the principal function of goods when determining their classification.

Moreover, the judgment reinforces the principle that penalties cannot be imposed arbitrarily, especially when the main issue has already been resolved in favor of the importer. It serves as a reminder to authorities to ensure that penalties are justified and proportionate to the alleged offense.

Conclusion

The CESTAT Kolkata’s decision in favor of M/s Express Clearing Agency is a testament to the importance of fair adjudication and the role of precedents in ensuring consistency in legal decisions. This case will likely serve as a reference point for similar disputes in the future, providing clarity on the classification of goods and the liability of CHAs in customs-related matters.

Source: CESTAT Kolkata

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March 7, 2026
CESTAT Kolkata Sets Aside IGST Demand
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 03.03.2026

CESTAT Kolkata Sets Aside IGST Demand

Adv Ravi Shekhar Jha

This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.

In a significant ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, has set aside a demand raised by the Commissioner of Customs (Port), Kolkata, against M/s Chirag Corporation. This case, revolving around the classification and IGST rate applicable to imported goods, highlights critical aspects of customs law, including the finality of assessments, the invocation of the extended period under Section 28(4) of the Customs Act, 1962, and the concept of revenue neutrality.

Case Background

M/s Chirag Corporation imported 40 sets of Divya Shakti brand power tillers in August 2017 and filed a Bill of Entry, classifying the goods under CTH 84328090. The company paid IGST at the rate of 12% as per Notification No. 1/2017-CT (Rate) dated 28.06.2017. The Bill of Entry was assessed and cleared without any provisional assessment, bond, or bank guarantee.

However, nearly five years later, on 6th April 2022, the Department issued a Show Cause Notice (SCN) invoking the extended period under Section 28(4) of the Customs Act, alleging that the applicable IGST rate was 18%, not 12%. The lower authorities confirmed the demand, prompting M/s Chirag Corporation to file an appeal before the CESTAT.

Key Arguments by the Appellant 

The appellant, represented by Advocate, raised the following points:
1. Finality of Assessment: The Bill of Entry was finalized and never challenged by the Department. Referring to the Supreme Court’s judgment in ITC Ltd. v. Commissioner of Central Excise, Kolkata-IV, the appellant argued that a finalized assessment cannot be reopened indirectly through a demand notice without first challenging the assessment itself.
2. Limitation Period: The SCN was issued nearly five years after the import, exceeding the normal limitation period. The appellant contended that there was no suppression, misstatement, collusion, or fraud, which are prerequisites for invoking the extended period under Section 28(4).
3. Revenue Neutrality: The appellant emphasized that the IGST paid at the time of import was fully available as Input Tax Credit (ITC) under the CGST Act, 2017. Since the goods were sold on payment of GST, the situation was revenue-neutral, and there was no intention to evade tax.
Key Arguments by the Respondent 

The respondent argued that the appellant had wrongly claimed the benefit of the notification, and the extended period was rightly invoked.

CESTAT’s Observations and Ruling

The Tribunal, comprising Hon’ble Judicial Member and Hon’ble Technical Member, made the following observations:
1. Finalized Assessment: The Tribunal acknowledged that the Bill of Entry was finalized and not challenged by the Department. However, since the imports occurred before the Supreme Court’s judgment in ITC Ltd., the Tribunal did not accept the appellant’s argument on this count.
2. Limitation Period: The SCN was issued well beyond the normal limitation period. The Tribunal noted that the classification, notification number, and IGST rate were clearly declared in the Bill of Entry, and the dispute was merely a matter of interpretation. This did not constitute suppression or willful misstatement, which are necessary to invoke the extended period under Section 28(4).
3. Revenue Neutrality: The Tribunal emphasized that the appellant was eligible to avail ITC for the IGST paid at the time of import, and the goods were sold on payment of GST. This made the situation revenue-neutral, further negating any intention to evade tax.
4. Precedents: The Tribunal referred to similar cases, including Chiripal Poly Films Ltd. v. Commissioner of Customs, Ahmedabad and Himadri Speciality Chemical Ltd. v. Principal Commissioner of Customs, Visakhapatnam. In both cases, the extended period was held to be inapplicable due to the absence of suppression and the revenue-neutral nature of the transactions.
Final Decision

The Tribunal concluded that the demand raised by the Department was barred by limitation and could not be sustained. The impugned order was set aside, and the appeal was allowed with consequential relief as per law.

Key Takeaways
1. Finality of Assessment: Once a customs assessment is finalized, it cannot be reopened indirectly through a demand notice unless the assessment itself is challenged.
2. Extended Limitation Period: The extended period under Section 28(4) of the Customs Act can only be invoked if there is evidence of suppression, willful misstatement, collusion, or fraud.
3. Revenue Neutrality: In cases where the tax paid is available as ITC and the situation is revenue-neutral, the intention to evade tax cannot be established.
4. Judicial Precedents: The Tribunal’s reliance on previous rulings underscores the importance of consistency in judicial decisions and the application of established legal principles.
Conclusion

The decision in M/s Chirag Corporation v. Commissioner of Customs (Port), Kolkata serves as a reminder of the importance of adhering to procedural requirements in customs assessments and the limitations on invoking the extended period for demand notices. It also highlights the significance of revenue neutrality in determining the intent to evade tax. This ruling is likely to have far-reaching implications for similar cases in the future, providing clarity and guidance to both taxpayers and the Department.

Source: CESTAT Kolkata

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March 3, 2026
CESTAT Kolkata Sets Aside Customs Broker License Revocation Over Procedural Lapse
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 16.02.2026

CESTAT Kolkata Sets Aside Customs Broker License Revocation Over Procedural Lapse

Adv Ravi Shekhar Jha

This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.comor on his Mobile +91-9999005379.

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, recently delivered a significant judgment in the case of M/s Chatterji & Co. vs. Commissioner of Customs (Port), Kolkata. This case revolved around the revocation of a Customs Broker License under the Customs Brokers Licensing Regulations, 2018 (CBLR 2018). The Tribunal’s decision to set aside the revocation order highlights the importance of adhering to procedural timelines and principles of natural justice in adjudication processes.

Background of the Case

The appellant, M/s Chatterji & Co., was issued a Show Cause Notice (SCN) on July 16, 2019, for alleged violations of the provisions of CBLR 2018. This SCN was based on an Offence Report received from the Directorate of Revenue Intelligence (DRI) on April 30, 2019. Subsequently, the appellant’s Customs Broker License was suspended on May 1, 2019.

The appellant challenged the suspension order, and the CESTAT Kolkata, in its Final Order No. 75731/2024 dated April 19, 2024, set aside the suspension order, citing delayed action by the Revenue authorities. However, the Principal Commissioner of Customs later revoked the appellant’s license through an Order-in-Original (OIO) dated August 16, 2022, which led the appellant to file an appeal before the Tribunal.

Key Arguments Presented 
1. Violation of Procedural Timelines: The appellant argued that the OIO was passed beyond the stipulated time frame under Regulation 17(7) of CBLR 2018. According to this regulation, the Principal Commissioner or Commissioner of Customs must pass an order of suspension or revocation within 90 days from the date of submission of the Inquiry Report by the Deputy Commissioner or Assistant Commissioner of Customs. In this case, the Inquiry Report was submitted on March 28, 2022, but the OIO was passed on August 16, 2022—well beyond the 90-day limit.
2. Previous Tribunal Orders: The appellant highlighted two previous orders by the Tribunal that set aside similar actions taken by the Revenue authorities. These orders demonstrated that the alleged contraventions were not substantiated and that the suspension of the appellant’s license was unjustified.
3. Compliance with CBLR 2018: The appellant contended that they had fulfilled the requirements under Regulation 10(a), (d), and (e) of CBLR 2018, further challenging the grounds for revocation of their license.
Tribunal’s Observations

The Tribunal carefully examined the timeline of events and the provisions of Regulation 17(7) of CBLR 2018. It noted that the Inquiry Report was submitted on March 28, 2022, and the OIO was passed on August 16, 2022—more than 130 days later. This was a clear violation of the 90-day time limit prescribed under Regulation 17(7). The Tribunal emphasized that the regulation does not provide any saving clause for exceeding this time limit, making the delay a procedural lapse.

The Tribunal also acknowledged its previous orders, which had set aside the suspension of the appellant’s license due to delayed action by the Revenue authorities. These orders further supported the appellant’s case.

Final Decision

In its judgment, the Tribunal set aside the impugned order, allowing the appeal filed by M/s Chatterji & Co. The Tribunal held that the revocation of the Customs Broker License was invalid due to the procedural lapse in adhering to the time limit under Regulation 17(7) of CBLR 2018. The appellant was deemed eligible for consequential relief as per the law.

Key Takeaways
1. Adherence to Procedural Timelines: The case underscores the importance of strict compliance with procedural timelines in adjudication processes. The Tribunal’s decision serves as a reminder to authorities to ensure timely action to uphold the principles of natural justice.
2. Significance of Previous Judicial Precedents: The Tribunal’s acknowledgment of its earlier orders highlights the importance of consistency in judicial decisions and the role of precedents in shaping outcomes.
3. Protection of Rights Under CBLR 2018: The judgment reinforces the safeguards provided under CBLR 2018 to Customs Brokers, ensuring that their licenses cannot be arbitrarily revoked without following due process.
Conclusion

The CESTAT Kolkata’s decision in this case is a landmark ruling that emphasizes the need for procedural fairness and timely action by adjudicating authorities. It serves as a precedent for similar cases and provides reassurance to Customs Brokers that their rights under CBLR 2018 will be protected. This judgment is a testament to the judiciary’s role in upholding justice and ensuring accountability in administrative processes.

Source: CESTAT Kolkata

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February 16, 2026
CESTAT Kolkata Upholds Exporter Rights: Landmark Ruling on Customs Valuation Dispute
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 10.02.2026

CESTAT Kolkata Upholds Exporter Rights: Landmark Ruling on Customs Valuation Dispute

Adv Ravi Shekhar Jha

This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.comor on his Mobile +91-9999005379.

In a significant judgment, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, has delivered a landmark decision in the case of Commr. of Customs (Port), Kolkata vs. Appellant & M/s Ankraj Developer Pvt. Ltd.. The case revolved around the valuation of exported goods, specifically leather wallets, and the alleged overvaluation by the appellants. The Tribunal’s decision not only dismissed the Revenue’s appeals but also reinforced the importance of adhering to statutory valuation principles under the Customs Act, 1962.

Background of the Case

The dispute originated when the appellants and M/s Ankraj Developer Pvt. Ltd., sought to export leather wallets under nine shipping bills during February 2023. The declared Free on Board (FOB) value of the goods was ₹6,61,02,740. However, the Customs Department alleged that the declared value was inflated, leading to potential undue drawback benefits. Following a market survey, the Department re-determined the value to ₹4,72,30,000, which was later revised to ₹5,22,87,600 by the adjudicating authority. The goods were confiscated, and penalties and redemption fines were imposed.

The appellants challenged the adjudication order before the Commissioner (Appeals), who set aside the order, citing fundamental errors in the valuation process. Dissatisfied with this decision, the Revenue filed appeals before the Tribunal.

Key Arguments

Revenue’s Arguments

The Revenue contended that the declared value was excessively high and based on overvaluation. They argued that a market survey was conducted to determine the correct value, which included the appellant’s representative. The adjudicating authority had considered the appellant’s submissions and revised the valuation, ensuring compliance with principles of natural justice. The Revenue claimed that the appellants were attempting to claim undue drawback benefits and justified the penalties and redemption fines imposed.

Respondents’ Arguments

The respondents argued that the Department failed to follow the procedure outlined in Section 14 of the Customs Act, 1962, and the Customs Valuation (Determination of Value of Export Goods) Rules, 2007 (CVR, 2007). They emphasized that the declared value was consistent with past export transactions to the same overseas importer. The respondents also pointed out flaws in the market survey, which compared non-comparable goods and ignored the higher procurement costs from traders. They argued that the adjudicating authority had arbitrarily added a notional profit margin of 10%, which is not supported by any legal provision.

Tribunal’s Observations

After hearing both sides and reviewing the evidence, the Tribunal made the following key observations:
1. Violation of Statutory Valuation Principles: The Tribunal noted that the Customs Act, 1962, and CVR, 2007 mandate a sequential approach to valuation. The transaction value declared in the shipping bills should be accepted unless the Revenue provides concrete evidence to prove otherwise. In this case, the Department failed to justify the rejection of the declared value.
2. Errors in Market Survey: The Tribunal found that the market survey conducted by the Department was flawed. It compared dissimilar goods and failed to account for factors such as procurement costs, compliance testing, and warranty obligations that impact export pricing.
3. Past Export Data Ignored: The Tribunal highlighted that the adjudicating authority disregarded the appellant’s consistent export history, which demonstrated similar values for identical goods exported to the same buyers in the past.
4. Improper Application of Customs Valuation Rules: The Tribunal criticized the Department for bypassing the mandatory sequential application of valuation rules. The adjudicating authority failed to exhaust primary methods under Rules 3 and 4 before invoking Rule 6, which contravenes established legal principles.
5. No Evidence of Misdeclaration: The Tribunal found no evidence of misdeclaration, forged documents, or fabricated claims by the appellants. The goods were cleared through proper banking channels, and all material particulars matched the declared values.
Final Decision

The Tribunal upheld the Commissioner (Appeals)’ decision, dismissing the Revenue’s appeals. It concluded that the rejection of the declared FOB value was legally unsustainable and that the confiscation of goods, along with the imposition of fines and penalties, was unwarranted. The Tribunal directed the Customs Department to release the goods immediately, considering the significant delay of three years since their seizure.

Key Takeaways

This judgment underscores the importance of adhering to statutory valuation principles under the Customs Act, 1962, and CVR, 2007. It reiterates that the declared transaction value should be accepted unless the Revenue provides substantial evidence to prove otherwise. The case also highlights the need for proper application of the sequential valuation mechanism and the importance of considering past export data and business relationships.

The Tribunal’s decision serves as a reminder to authorities to ensure fairness and transparency in valuation disputes, protecting the rights of exporters while safeguarding revenue interests. It also emphasizes the need for thorough investigations and evidence-based conclusions in cases of alleged overvaluation or misdeclaration.

Conclusion

The dismissal of the Revenue’s appeals in this case is a victory for exporters and a reaffirmation of the principles of natural justice. It sets a precedent for future valuation disputes, ensuring that the Customs Department adheres to established legal procedures and safeguards. This judgment is a testament to the importance of upholding the rule of law and protecting the rights of businesses engaged in international trade.

Source: CESTAT Kolkata

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February 10, 2026
CESTAT Kolkata Overturns Customs Duty Demand Over Disputed Chartered Engineer Certificate
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 03.02.2026

CESTAT Kolkata Overturns Customs Duty Demand Over Disputed Chartered Engineer Certificate

Adv Ravi Shekhar Jha

This Article has been written by Advocate Ravi Shekhar Jha-BALLB & LLM (Constitutional Law) based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.comor on his Mobile +91-9999005379.

In a significant judgment, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Eastern Zonal Bench, Kolkata, has ruled in favor of M/s. Sana Impex Private Limited, setting aside the demands for differential customs duty and interest. The case, which revolved around the import of old and used machinery, highlights critical issues regarding the validity of certificates issued by Chartered Engineers and the procedural lapses in customs assessments.

Background of the Case

M/s. Sana Impex Private Limited, a Kolkata-based importer, had imported four old and used color printing machines with standard accessories and a paper cutting machine with standard accessories under Customs Tariff Headings 84431200 and 84411010, respectively. The company filed two Bills of Entry (Nos. 5165104 and 5165044) on May 5, 2016, for the clearance of these goods. Along with the Bills of Entry, the importer submitted all requisite documents, including the Bill of Lading, Country of Origin certificate, Commercial Invoice, Packing List, and a Load Port Chartered Engineer Certificate.

The goods were examined by the shed officer, who ordered their release based on the Load Port Chartered Engineer Certificate. However, the Assessing Officer provisionally assessed the Bills of Entry based on the invoice value and marked them for further investigation by the Special Intelligence and Investigation Branch (SIIB). The consignments were allowed ‘out of charge’ after the importer submitted a PD Bond.

Six years later, in December 2022, the SIIB directed the assessing group to finalize the Bills of Entry based on a certificate issued by a local Chartered Engineer. The final assessment led to the confirmation of differential customs duty amounting to Rs. 6,14,034/- (Rs. 3,16,074/- + Rs. 2,97,960/-), along with interest. Aggrieved by this decision, the importer filed an appeal before the Commissioner of Customs (Appeals), who upheld the final assessment orders. Subsequently, the importer approached the CESTAT Kolkata to challenge the impugned order.

Key Arguments Presented by the Appellant 

During the hearing, the appellant, represented by Advocate and Consultant, raised several critical points:
1. Validity of the Chartered Engineer Certificate: The appellant argued that the certificate issued by Mr. Sajal Majumdar on May 7, 2016, was invalid as it was prepared five days before the goods were physically examined on May 11 and 12, 2016. The appellant contended that the certificate could not have accurately assessed the condition and value of the goods without a proper examination.
2. Reliance on Load Port Certificate: The appellant emphasized that the goods were released based on the Load Port Chartered Engineer Certificate, which was submitted at the time of filing the Bills of Entry. This certificate confirmed the goods were “old and used” and did not dispute their declared value.
3. Procedural Lapses: The appellant questioned the appointment of the local Chartered Engineer, asserting that they were not informed about who appointed him. They also highlighted that the shed officer had already conducted a thorough examination of the goods and referred to the Overseas Chartered Engineer Certificate during the investigation.
Observations and Judgment by CESTAT Kolkata

The Hon’ble Tribunal, comprising Member (Judicial) and Member (Technical), carefully examined the facts and arguments presented by both sides. The Tribunal observed the following:
1. The certificate issued by the Chartered Engineer, dated May 7, 2016, was prepared without physically examining the goods, as the container was opened and examined only on May 11 and 12, 2016. Therefore, the certificate lacked validity and could not be relied upon for enhancing the value of the imported goods.
2. The Load Port Chartered Engineer Certificate submitted by the appellant at the time of filing the Bills of Entry was valid and formed the basis for the initial release of the goods. The Tribunal noted that the lower authorities had ignored this certificate without providing sufficient justification.
3. The enhancement of the value of the goods based on an invalid certificate was deemed legally unsustainable.
Based on these observations, the Tribunal set aside the impugned order and allowed the appeal filed by M/s. Sana Impex Private Limited. The demands for differential customs duty and interest were quashed, and the appellant was granted consequential relief as per the law.

Conclusion

This judgment underscores the importance of adhering to proper procedures and relying on valid documentation during customs assessments. The decision by CESTAT Kolkata serves as a reminder that procedural lapses and reliance on invalid certificates cannot form the basis for imposing additional duties and interest on importers. The ruling is a significant victory for M/s. Sana Impex Private Limited and sets a precedent for similar cases in the future.

Source: CESTAT Kolkata

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February 3, 2026