𝐀𝐚𝐝𝐫𝐢𝐤𝐚𝐚 𝐋𝐞𝐠𝐚𝐥 𝐒𝐞𝐫𝐯𝐢𝐜𝐞𝐬 (𝐀𝐋𝐒)

Tag: #Customs Duty

CESTAT Chandigarh Sets Aside Drawback Recovery and Penalty

ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 21.07.2025

CESTAT Chandigarh Sets Aside Drawback Recovery and Penalty

Background of the Case

The case revolves around allegations of fraudulent claim of duty drawback and DEPB credits by three exporters who allegedly mis-declared goods as high-value items like gear cutting tools of cobalt-bearing high-speed steel and heat-resistant rubber tension tapes through the Ludhiana port.

The Directorate of Revenue Intelligence (DRI), Amritsar, initiated investigations linking the appellants to a broader fraud syndicate allegedly operated shell firms like Jyoti Steel and Krishna Hardware. The appellants were accused of receiving fictitious invoices from these shell companies to claim inflated export benefits.

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 Chandigarh

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July 21, 2025
CESTAT Bangalore Clarifies Travertine Classification and Upholds Exemption for Marble Slabs
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 19.07.2025

CESTAT Bangalore Clarifies Travertine Classification and Upholds Exemption for Marble Slabs

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Bangalore, in Final Order Nos. 21002-21004/2025 dated 15.07.2025, held that Travertine—a calcareous stone—is a variety of Marble, and therefore eligible for the concessional Central Excise duty (CVD) benefit under Sl. No. 54 of Notification No. 12/2012-CE dated 17.03.2012. This decision sets aside duty demands and penalties imposed on M/s Marble Centre International Pvt. Ltd. and its Executive Director.

Background of the Case
- The appellant imported Honed/Semi-Polished Marble Slabs including Travertino Titanium, Travertine Extence, Silver Beige, etc., and classified them under CTH 68022190.
- The customs authority denied them the benefit of reduced CVD @ Rs. 60 per sq. metre under Notification No. 12/2012-CE, arguing that Travertine is not marble.
- Demand notices for differential duty amounting to over ₹1.24 crore, along with interest and personal penalties, were issued.
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 Bangalore

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July 19, 2025
CESTAT Kolkata Orders 12% Interest on ₹50 Lakh Refund to Exporter
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 18.07.2025

CESTAT Kolkata Orders 12% Interest on ₹50 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 ₹50 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 ₹50 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 concentrate—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 ₹50,00,000 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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July 18, 2025
CESTAT Bangalore Allows Conversion of Free Shipping Bills to Drawback Bills
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 17.07.2025

CESTAT Bangalore Allows Conversion of Free Shipping Bills to Drawback Bills

In a major relief to exporters affected by the early days of the GST transition, the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Bangalore has allowed conversion of free shipping bills into drawback shipping bills filed by M/s Nitta Gelatin India Ltd., setting aside the rejection order passed by the Commissioner of Customs, Cochin.

Background of the Case
- Exports Made: Between 25.07.2017 and 04.08.2017
- Products: Gelatin, Chitosan, and Ossein
- Issue: The exporter filed free shipping bills without claiming duty drawback, but later requested conversion to All Industry Rate (AIR) drawback shipping bills.
- Request Date: 23.08.2017 — within a month from export
- Grounds: Circular No. 22/2017-Cus. dated 30.06.2017 allowed exporters to claim drawback during GST transition period (01.07.2017 – 30.09.2017)
However, the Commissioner rejected the request, citing non-compliance with Rule 12(1)(a) of the Drawback Rules, 1995, and held that the reasons were not “beyond the control” of the exporter.

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 Bangalore

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July 17, 2025
CESTAT Chandigarh Sets Aside Warehouse License Cancellation
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 16.07.2025

CESTAT Chandigarh Sets Aside Warehouse License Cancellation

In a significant ruling favoring the rights of bonded warehouse license holders, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chandigarh Bench, has set aside the cancellation of the Public Bonded Warehouse License of M/s Ajay Wines & Spirits, while upholding a monetary penalty of ₹4 lakhs under Section 117 of the Customs Act, 1962.

Background of the Case
- M/s Ajay Wines & Spirits was operating under a Public Bonded Warehouse License No. 08/2023, granted under Section 57 of the Customs Act.
- Two separate stock verifications conducted in April 2024 revealed shortages of imported liquor cases:
  - 04.04.2024: 339 cases found short; duty of ₹17.14 lakhs was deposited.
  - 23.04.2024: Additional shortages observed related to stock of M/s Castle Spirits Pvt. Ltd.
- A Show Cause Notice was issued proposing:
  - Cancellation of the warehouse license under Section 58B
  - Penalty under Section 117 for contravention of warehouse regulations
The Principal Commissioner of Customs, Ludhiana, vide Order-in-Original dated 21.05.2025, imposed the maximum penalty and cancelled the warehouse license of the appellant.

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 Chandigarh

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July 16, 2025
CESTAT Chennai Sets Aside Penalty on Freight Forwarders
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 15.07.2025

CESTAT Chennai Sets Aside Penalty on Freight Forwarders

Background of the Case

The appeals arose from a penalty order passed by the Commissioner of Customs (Seaport – Export), Chennai, against two Custom House Agents (CHAs):
- M/s. Meticulous Forwarders
- M/s. Masterstroke Freight Forwarders Pvt. Ltd.
They were penalized ₹7,00,000 each under Section 112(a) of the Customs Act, 1962, for allegedly aiding the diversion of duty-free imported raw silk yarn by M/s. Kalp Impex under the Advance Authorisation Scheme, which was reportedly sold locally without fulfilling export obligations.

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

Source: CESTAT Chennai

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July 15, 2025
CESTAT Delhi Allows Duty Exemption on Lithium-Ion Battery Components
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 14.07.2025

CESTAT Delhi Allows Duty Exemption on Lithium-Ion Battery Components

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Delhi has allowed M/s XOR Technologies LLP to avail duty exemption under Entry 512 of Notification No. 50/2017-Cus, holding that the manufacture of lithium-ion batteries—even when used in power banks—satisfies the conditions of the notification. The Tribunal quashed the demand of ₹8.13 crores raised by the Customs Department and dismissed the penalty under Section 114A of the Customs Act, 1962.

Case Background
- Appellant: M/s XOR Technologies LLP, Delhi
- Products Involved: Lithium-ion cells, USB cables, nickel strips, plastic housing, etc.
- Period: FY 2017 to 2019
- Notification Involved: No. 50/2017-Cus, Entry 512
- Allegation: Components were used in power banks, not in lithium-ion batteries, violating the terms of the exemption.
- Duty Demand: ₹8,12,95,799 with interest and equal penalty under Section 114A
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 Delhi

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July 14, 2025
Kerala High Court Upholds DGFT’s Supremacy in Advance Authorization Dispute

ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 12.07.2025

Kerala High Court Upholds DGFT’s Supremacy in Advance Authorization Dispute

Background of the Case

Nitta Gelatin India Ltd., a Cochin-based manufacturer of collagen peptides, was importing decalcified fish scales under the Advance Authorization Scheme (AAS) issued by the DGFT. While earlier imports (2012–2016) were described as “fish protein”, a customs inspection in April 2016 led to the goods being classified by Revenue as “decalcified fish scale” under CTH 0511 9190, instead of the claimed “fish protein” under CTH 3504 0099.

Customs alleged misdeclaration and issued a Show Cause Notice in respect of 51 consignments. The Commissioner of Customs demanded differential duty, imposed redemption fine, and levied penalties under Sections 112(a), 114A, 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: Kerala High Court

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July 12, 2025
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 ₹29.62 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 ₹13.5 crores, and a redemption fine of ₹5 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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July 12, 2025
Bombay High Court Quashes IGST Interest and Penalty
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 11.07.2025

Bombay High Court Quashes IGST Interest and Penalty

In a significant ruling, the Hon’ble Bombay High Court in A.R. Sulphonates Pvt. Ltd. v. Union of India & Ors., Writ Petition No. 19366 of 2024, delivered on 9th April 2025, held that interest, penalty, and redemption fine imposed for non-compliance with the “pre-import” condition under the Advance Authorization Scheme are without the authority of law. The Court quashed the relevant portion of the Customs adjudication order dated 1st August 2024 and invalidated CBIC Circular No. 16/2023-Customs to the extent it sought to recover interest along with IGST.

Background

The Petitioner, A.R. Sulphonates Pvt. Ltd., imported Linear Alkyl Benzene (LAB) under eleven Advance Authorization Licenses between 27th October 2017 and 27th March 2018. These imports were made without payment of IGST, relying on Notification No. 18/2015-Cus. as amended by Notification No. 79/2017-Cus., which imposed a “pre-import” condition for exemption from IGST.

Subsequently, DRI initiated investigations alleging violation of the pre-import condition, leading to the issuance of a Show Cause Notice seeking:
- IGST demand of ₹7.18 crore,
- Interest under Section 28AA,
- Penalty under Section 112(a),
- Redemption fine of ₹2 crore under Section 125, and
- Enforcement of bonds under Section 143(3).
- The adjudication order dated 1st August 2024 confirmed these demands.
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: Bombay High Court

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July 11, 2025