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Tag: #CESTATKolkata

  • CESTAT Kolkata Clarifies Interest Liability in Provisional Customs Assessments

    CESTAT Kolkata Clarifies Interest Liability in Provisional Customs Assessments

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 07.08.2025

    CESTAT Kolkata Clarifies Interest Liability in Provisional Customs Assessments ​ ​​ ​

    In a significant ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, has delivered a judgment that clarifies the applicability of interest liability under Section 18(3) of the Customs Act, 1962, in cases of provisional customs assessments. The decision, pronounced on August 5, 2025, in the case of M/s NHPC Limited vs. Commissioner of Customs (Port), Kolkata, addresses key issues surrounding the retrospective application of interest provisions and penalties in customs law.

    Background of the Case

    The appellant, NHPC Limited, a public sector undertaking under the Ministry of Power, imported equipment and spare parts for the Teesta Hydroelectric Project in Sikkim between April 2004 and April 2008. These imports were provisionally assessed under Section 18(1) of the Customs Act, 1962, and classified under CTH 9801, availing a NIL rate of Basic Customs Duty (BCD). ​ However, the Department later issued a show-cause notice in May 2019, alleging that the value of spare parts imported exceeded 10% of the value of the main equipment, violating the conditions of the customs notification. ​ Consequently, differential duty was demanded, along with interest and penalties.

    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 Kolkata

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  • CESTAT Kolkata Dismisses Revenue Appeal in Betel Nut Origin Dispute

    CESTAT Kolkata Dismisses Revenue Appeal in Betel Nut Origin Dispute

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 02.08.2025

    CESTAT Kolkata Dismisses Revenue Appeal in Betel Nut Origin Dispute ​ ​

    In a significant ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, dismissed appeals filed by the Revenue in a case involving alleged fraudulent import of betel nuts. ​ The case, which revolved around mis-declaration of the country of origin and undervaluation of goods, highlights the complexities of international trade and customs regulations. ​ Here’s a detailed look at the case and the tribunal’s decision.

    Background of the Case

    The Directorate of Revenue Intelligence (DRI), Ahmedabad Zonal Unit, initiated investigations based on specific intelligence, appellant was involved in fraudulent imports of betel nuts under the Import-Export Code (IEC) of M/s S. Krishna & Co. ​ The betel nuts, allegedly of Indonesian origin, were routed through Bangladesh to evade customs duties by misusing the SAARC Preferential Trading Arrangement (SAPTA) benefits under Notification No. ​ 105/1999.

    The investigation revealed that Bangladesh-based firms were re-exporting betel nuts without any processing, falsely claiming them as products of Bangladesh. ​ Additionally, the goods were grossly undervalued, with actual values ranging from USD 1400 to USD 1750 PMT, while declared values were between USD 300 and USD 450 PMT. ​ Evidence, including email correspondences and statements, pointed to a network involving Indian importers, Bangladeshi firms, and an Indonesian broker.

    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 Kolkata

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  • CESTAT Kolkata Rejects Revenue’s Misdeclaration Allegation ​

    CESTAT Kolkata Rejects Revenue’s Misdeclaration Allegation ​

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 28.07.2025

    CESTAT Kolkata Rejects Revenue’s Misdeclaration Allegation ​

    In a significant ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, dismissed the appeal filed by the Revenue against M/s Maa Kali Traders concerning the classification and valuation of imported goods. The case revolved around whether the imported goods, declared as “Unwrought/Unrefined Zinc,” were misclassified as “Zinc Dross,” a restricted item under the Foreign Trade Policy (FTP). ​ The Tribunal’s decision highlights the importance of evidence-based adjudication and adherence to procedural norms in customs disputes.

    Background of the Case

    M/s Maa Kali Traders imported goods between January 2014 and December 2015, declaring them as “Unwrought/Unrefined Zinc” under CTH No. 79012090. The Revenue conducted chemical tests to ascertain the zinc content, which revealed a higher percentage of zinc than declared. ​ Based on these findings, the Assessing Officer issued an assessment order demanding differential duty of Rs. ​ 5,05,494/- along with interest, citing a higher assessable value. ​

    The importer challenged the valuation, arguing that the transaction value was arbitrarily enhanced without legal basis. ​ Simultaneously, the Revenue contended that the goods were misdeclared and should be classified as “Zinc Dross,” subject to import restrictions.

    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 Kolkata

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  • CESTAT Kolkata Allows SSI Exemption

    CESTAT Kolkata Allows SSI Exemption

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 26.07.2025

    CESTAT Kolkata Allows SSI Exemption

    The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata, recently delivered a significant judgment in the case of M/s. Switz Foods Pvt. ​ Ltd. regarding the applicability of Small Scale Industry (SSI) exemption under Notification No. ​ 8/2003-CE. This case highlights critical aspects of excise duty compliance and the interpretation of SSI exemption provisions. ​

    Background of the Case

    M/s. Switz Foods Pvt. ​ Ltd., a manufacturer of cakes, cookies, and pastries under their own brands β€˜Fresh Bake’ and β€˜Bake Shop,’ also undertook job work for the β€˜Monginis’ brand. ​ While they paid excise duty on Monginis-branded goods, they claimed SSI exemption for their Bake Shop products, citing turnover below the threshold limit. ​ However, the Revenue issued a Show Cause Notice (SCN) alleging non-compliance with SSI exemption rules and demanded excise duty along with penalties.

    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 Kolkata

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  • CESTAT Kolkata Upholds DGFT Clarification

    CESTAT Kolkata Upholds DGFT Clarification

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 25.07.2025

    CESTAT Kolkata Upholds DGFT Clarification

    In a landmark decision, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Eastern Zonal Bench, Kolkata, has dismissed the appeal filed by the Revenue against M/s India Carbon Ltd, affirming their right to import Raw Petroleum Coke (RPC) for manufacturing Calcined Petroleum Coke (CPC). This judgment highlights the importance of regulatory clarity and adherence to policy guidelines in the import-export domain. ​

    Background of the Case

    M/s India Carbon Ltd, a leading calciner, specializes in manufacturing CPC by processing RPC. ​ CPC is a critical component used in anode making for the aluminum industry. ​ Until October 2019, the import of RPC with any sulphur content was unrestricted. ​ However, following a Supreme Court order, the Central Government amended the import policy, imposing conditions on RPC imports. ​ Licenses for RPC imports were issued by the Directorate General of Foreign Trade (DGFT) based on recommendations from an Expert Committee. ​

    In 2021, M/s India Carbon Ltd was granted a license to import 37,777 M.T. of RPC for anode making in the aluminum industry. ​ However, a portion of the imported RPC was seized by Customs Authorities, citing alleged violations of the import policy due to sulphur content exceeding 3.5%. ​ This led to a series of legal proceedings, culminating in the present appeal before 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 Kolkata

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  • CESTAT Kolkata Orders 12% Interest on β‚Ή50 Lakh Refund to Exporter

    CESTAT Kolkata Orders 12% Interest on β‚Ή50 Lakh Refund to Exporter

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 18.07.2025

    CESTAT Kolkata Orders 12% Interest on β‚Ή50 Lakh Refund to Exporter

    In a significant pro-importer decision, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Kolkata, in the case of M/s Alliance International v. Commissioner of Customs (Port), Kolkata [Final Order No. 76921/2025 dated 15.07.2025], has upheld the right of the appellant to receive interest at 12% per annum on a pre-deposit of β‚Ή50 lakh made during the investigation stage. This ruling reinforces the jurisprudence that interest must be paid on pre-deposits when the same are refunded post-adjudication.

    Case Background

    • Appellant: M/s Alliance International, Chandigarh
    • Respondent: Commissioner of Customs (Port), Kolkata
    • Issue: Denial of interest on β‚Ή50 lakh refunded post-investigation
    • Relevant Period: Exports made between July 2016 – August 2020
    • Controversy: Alleged misdeclaration of exported goods as refractory mortar instead of chrome ore concentrateβ€”a restricted item liable to 30% export duty

    During the course of the investigation initiated by the Directorate of Revenue Intelligence (DRI), the appellant was compelled to deposit β‚Ή50,00,000 on 16.10.2020. Eventually, the adjudicating authority, vide order dated 31.01.2023, ruled in favour of the appellant and directed refund of the 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 Kolkata

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  • CESTAT Kolkata Upholds MEIS Benefits and Export Classification

    CESTAT Kolkata Upholds MEIS Benefits and Export Classification

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 12.07.2025

    CESTAT Kolkata Upholds MEIS Benefits and Export Classification

    The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata Bench has set aside a customs duty demand of over β‚Ή29.62 crores imposed on M/s Aquapharm Chemical Limited, an EOU engaged in manufacturing water treatment chemicals. The tribunal ruled that the customs department had no jurisdiction to question the MEIS benefits without the Directorate General of Foreign Trade (DGFT) first cancelling the scrips.

    Background of the Case

    M/s Aquapharm, an Export Oriented Unit (EOU), had been exporting Organophosphorus compounds under the classification CTH 29319090 since 2006. The Directorate General of Foreign Trade (DGFT) had granted them MEIS (Merchandise Exports from India Scheme) scrips based on these exports between 2017 and 2021. However, the Directorate of Revenue Intelligence (DRI) initiated proceedings alleging that the products should have been classified as “Other Organo-phosphorus derivatives” under CTH 29313900, not eligible for MEIS.

    A Show Cause Notice was issued, culminating in a massive customs duty demand under Sections 28 and 28AAA of the Customs Act, 1962, along with interest, penalties exceeding β‚Ή13.5 crores, and a redemption fine of β‚Ή5 crores.

    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 Kolkata

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  • CESTAT Kolkata Allows β‚Ή2.97 Crore Refund to UD Solutions

    CESTAT Kolkata Allows β‚Ή2.97 Crore Refund to UD Solutions

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 11.07.2025

    CESTAT Kolkata Allows β‚Ή2.97 Crore Refund to UD Solutions

    Case Background

    M/s. UD Solutions Pvt. Ltd., engaged in the trading of mobile phones, filed 17 Bills of Entry between 26th March and 9th July 2015 and paid higher Countervailing Duty (CVD) due to system limitations on the ICEGATE portal. These limitations prevented claiming the benefit of Notification No. 12/2012-CE (Sl. No. 263A) which allowed a concessional rate of 1% excise duty for mobile phones, subject to non-availment of CENVAT credit.

    Following the Supreme Court’s decision in SRF Ltd. v. CC, Chennai (2015) which extended the benefit of conditional exemptions to importers, UD Solutions filed for a refund of β‚Ή2.97 crore for excess CVD paid. Although initially sanctioned by the adjudicating authority, the refund was later denied by the Commissioner (Appeals), citing lack of reassessment and reliance on an overruled decision.

    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 Kolkata

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  • CESTAT Kolkata Upholds Correct Classification of PVC Resin

    CESTAT Kolkata Upholds Correct Classification of PVC Resin

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 10.07.2025

    CESTAT Kolkata Upholds Correct Classification of PVC Resin

    The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Kolkata, has set aside the customs duty demand, penalties, and confiscation order passed by the Commissioner of Customs (Port), Kolkata. The dispute pertained to the classification of imported goodsβ€”Poly Vinyl Chloride (PVC) Resins (Suspension Grade)β€”under the Customs Tariff Act.

    Background of the Case

    M/s. Surabhi Enterprises Pvt. Ltd., Kolkata, imported PVC Resin (Suspension Grade) and classified it under CTH 3904 21 10, claiming a concessional rate of Basic Customs Duty under Sr. No. 459(I) of Notification No. 46/2011-Cus., dated 01.06.2011. The company also submitted a valid Country of Origin (COO) certificate supporting the classification. However, the Customs Department contested the classification and issued a Show Cause Notice alleging misdeclaration.

    The classification was changed to CTH 3904 10 90 (residuary entry), and a differential duty of β‚Ή13,09,717 was demanded. Goods were ordered to be confiscated under Section 111(m) and penalties were imposed under Sections 112(a) 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 Kolkata

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  • CESTAT Kolkata Ruling in Favour of Global Entrade on Project Import Dispute

    CESTAT Kolkata Ruling in Favour of Global Entrade on Project Import Dispute

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 30.06.2025

    CESTAT Kolkata Ruling in Favour of Global Entrade on Project Import Dispute

    The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata has quashed a β‚Ή12.95 lakh customs duty demand raised against M/s Global Entrade, an importer based in Assam, under the Project Import Regulations, 1986 (PIR 1986). The Tribunal held that the Show Cause Notice (SCN) issued by the customs department was time-barred, having been served nearly six years after the relevant import transaction.

    Case Background

    M/s Global Entrade had registered a contract with the customs authorities for importing machinery to establish a cold storage facility in Guwahati. The contract was registered under Project Import Registration No. S37(P)PROJ-08/2014 A(6), and was backed by Essentiality Certificates from the Ministry of Food Processing Industries, qualifying the import for concessional duty under Notification No. 12/2012-Customs, Entry Sl. No. 515.

    The machinery was imported via Bill of Entry No. 7356551 dated 12.11.2014, and provisional assessment was completed with applicable 5% Basic Customs Duty and NIL CVD, as per the project import benefit.

    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 Kolkata

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