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Tag: #Exports

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

    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 β€œfish protein”, a customs inspection in April 2016 led to the goods being classified by Revenue as β€œdecalcified fish scale” under CTH 0511 9190, instead of the claimed β€œfish 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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  • 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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  • Bombay High Court Quashes IGST Interest and Penalty

    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 β€œpre-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 β€œpre-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 β‚Ή7.18 crore,
    • Interest under Section 28AA,
    • Penalty under Section 112(a),
    • Redemption fine of β‚Ή2 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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  • Madras High Court Allows STPI Duty Exemption

    Madras High Court Allows STPI Duty Exemption

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 11.07.2025

    Madras High Court Allows STPI Duty Exemption

    In a landmark decision that provides much-needed clarity and relief to the IT and infrastructure sector, the Madras High Court has ruled in favour of Khivraj Tech Park Pvt. Ltd., granting it customs duty exemption for capital goods imported under the Software Technology Park of India (STPI) scheme despite a delayed approval from the Chennai Metropolitan Development Authority (CMDA).

    Case Background

    Khivraj Tech Park Pvt. Ltd., a recognized STPI unit, imported capital goods and claimed customs duty exemption under Notification No. 153/1993-Customs, which is available to STPI units for setting up or expanding infrastructure. However, the customs authorities rejected the exemption, citing that CMDA’s building plan approval was obtained only after the goods had been imported.

    The authorities alleged that the condition of prior CMDA approval was a prerequisite for claiming exemption under the STPI scheme, and hence, the benefits were not admissible.

    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: Madras High Court

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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 Delhi- DGFT Cancellation Mandatory for Action Under Section 28AAA

    CESTAT Delhi- DGFT Cancellation Mandatory for Action Under Section 28AAA

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 10.07.2025

    CESTAT Delhi- DGFT Cancellation Mandatory for Action Under Section 28AAA

    The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, Principal Bench, vide Final Order Nos. 50827-50828/2025 dated 04.06.2025, quashed the confiscation, recovery of export benefits, and penalties imposed on M/s K.G. Exports and its partner. The case revolved around the alleged diversion of export consignments and ineligible claim of Focus Market Scheme (FMS) benefits.

    Case Background

    M/s K.G. Exports, a manufacturer-exporter of ready-made garments, exported consignments to the UAE while declaring Panama as the destination in shipping bills. Based on the documents, the firm claimed benefits under the Focus Market Scheme (FMS), which incentivizes exports to specified countries like Panama.

    Subsequent investigations by Customs revealed that the goods were shipped to Foreigner, UAE, not Panama, as declared. Customs authorities alleged that this misrepresentation was done to fraudulently avail FMS benefits. Based on statements made by the freight forwarder, Customs proceeded against the exporter and its partner under Sections 113, 114(iii), 114AA, and 28AAA 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 Delhi

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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 Ahmedabad- SEZ Re-Export Goods Not Liable for Confiscation

    CESTAT Ahmedabad- SEZ Re-Export Goods Not Liable for Confiscation

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 10.07.2025

    CESTAT Ahmedabad- SEZ Re-Export Goods Not Liable for Confiscation

    The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Ahmedabad, vide Final Order No. 10546/2025 dated 09.07.2025, delivered by Hon’ble Judicial Member, quashed the confiscation and penalty proceedings initiated against Flamingo Logistics, a warehousing service provider operating in the Kandla Special Economic Zone (SEZ).

    Case Background

    Flamingo Logistics, acting on behalf of its client M/s. M A Value Smart Trading Limited (Hong Kong), filed four warehousing bills of entry with SEZ Customs for storing consignments including hard disks, mini tower computer cases, and motherboards. Upon examination, Customs authorities observed dust and scratches on the goods and, based on HP India’s opinion, classified them as β€œused” or β€œsecond-hand” goods.

    Relying on DGFT Notification No. 35(RE-2012)/2009-2014 and para 2.31 of the Foreign Trade Policy (FTP), Customs seized the goods citing import restrictions on second-hand items. While permitting re-export, the adjudicating authority imposed fines and penalties under Sections 111(d) and (m) of the Customs Act, 1962 on Flamingo Logistics.

    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 Ahmedabad

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  • Allahabad High Court- Roasted Areca Nuts Classified Under CTH 20081920

    Allahabad High Court- Roasted Areca Nuts Classified Under CTH 20081920

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 09.07.2025

    Allahabad High Court- Roasted Areca Nuts Classified Under CTH 20081920

    The Allahabad High Court, Lucknow Bench, has quashed the customs department’s seizure and upheld the classification of roasted areca nuts under Customs Tariff Heading (CTH) 2008 19 20, rejecting the department’s bid to treat them as dried areca nuts under CTH 0802 80.

    The case is a significant win for importers, especially those in the agro-commodity business, as it reinforces the legal status of Customs Authority for Advance Rulings (CAAR) and stresses strict adherence to procedural fairness.

    Background & Dispute

    The petitioner, M/s Rawder Petroleum Pvt. Ltd., imported roasted areca nuts from Indonesia based on an Advance Ruling dated 19.09.2024 obtained from CAAR, New Delhi, which classified the product under CTH 2008 19 20. The Department of Customs, however, challenged this ruling in appellate proceedings and seized the goods, claiming they were dried areca nuts falling under CTH 0802 80, based on test reports from CRCL, New Delhi.

    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: Allahabad High Court

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  • CESTAT Ahmedabad Allows Cross-Examination in Customs Dispute

    CESTAT Ahmedabad Allows Cross-Examination in Customs Dispute

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 09.07.2025

    CESTAT Ahmedabad Allows Cross-Examination in Customs Dispute

    The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Ahmedabad has ruled in favour of Kudrat Corporation, allowing their request for cross-examination of departmental witnesses in a customs adjudication proceeding.

    This judgment fortifies the principle that adjudicating authorities cannot deny cross-examination merely on assumptions, especially when statements, technical reports, or letters are relied upon in a Show Cause Notice (SCN).

    Case Background

    The dispute arose from the denial of cross-examination of 11 witnesses by the Principal Commissioner during the adjudication of a Show Cause Notice dated 03 July 2019, which was issued under Section 108 of the Customs Act, 1962. The Principal Commissioner rejected the request on the ground that no new facts were likely to emerge, and that the cross-examination would only cause delays.

    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 Ahmedabad

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