𝐀𝐚𝐝𝐫𝐢𝐤𝐚𝐚 𝐋𝐞𝐠𝐚𝐥 𝐒𝐞𝐫𝐯𝐢𝐜𝐞𝐬 (𝐀𝐋𝐒)

Tag: #Madras High Court

Madras High Court Quashes Customs Confiscation Order for Violating Natural Justice Principles
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 28.03.2026

Madras High Court Quashes Customs Confiscation Order for Violating Natural Justice Principles

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 Madras High Court, in its judgment dated February 20, 2026, delivered by Honourable, quashed the impugned confiscation order passed by the Additional Commissioner of Customs (Group 5), Chennai, in the case of M/s. Hiseins Exim vs. The Additional Commissioner of Customs (Group 5) [WP No. 35884 of 2024]. The court held that the order was passed in violation of the principles of natural justice and the mandatory provisions of Section 124 of the Customs Act, 1962.

Background of the Case

The petitioner, M/s. Hiseins Exim, challenged the confiscation order (Original No. 109886/2024/Gr5 dated October 17, 2024) issued by the respondent, the Additional Commissioner of Customs, Chennai. The petitioner argued that the order was passed without issuing a mandatory show cause notice or affording an opportunity for a personal hearing, as required under Section 124 of the Customs Act, 1962. The petitioner contended that this was a clear violation of the principles of natural justice.

The petitioner further stated that while they had submitted a letter on September 14, 2023, waiving the issuance of a show cause notice and personal hearing, this waiver was only intended to expedite the re-export of goods and did not apply to the confiscation of goods. The petitioner argued that the confiscation order caused serious civil consequences, and therefore, the issuance of a show cause notice and personal hearing was mandatory.

Respondent’s Arguments

The respondent, represented by the standing counsel, argued that the petitioner had voluntarily waived the issuance of a show cause notice and personal hearing through their letter dated September 14, 2023. The respondent contended that this waiver applied to both Section 28 and Section 124 of the Customs Act. Furthermore, the respondent argued that the petitioner had the option to file a statutory appeal before the competent appellate authority, making the writ petition non-maintainable.

The respondent also relied on the Supreme Court’s decision in Commissioner of Customs, Mumbai vs. Virgo Steels [2002 (141) E.L.T. 598 (S.C.)], which held that the right to a show cause notice under Section 28 of the Customs Act could be waived by the concerned party.

Court’s Observations

Justice analyzed the provisions of Sections 28 and 124 of the Customs Act and emphasized the distinction between the two. The court observed that:
1. Section 28 of the Customs Act deals with the recovery of duties not levied, short levied, or erroneously refunded. A show cause notice under this section can be waived if the concerned party voluntarily relinquishes their right to it.
2. Section 124 of the Customs Act, however, mandates the issuance of a show cause notice and the provision of a reasonable opportunity for a hearing before confiscating goods or imposing penalties. This requirement is essential to uphold the principles of natural justice and cannot be waived through pre-printed forms or under pressure.
The court further noted that the confiscation of goods and imposition of penalties under Section 124 of the Customs Act have serious civil consequences for the importer/exporter. Therefore, the issuance of a show cause notice and the provision of a personal hearing are mandatory and cannot be waived.

Key Judgments Referenced 

The court referred to several landmark judgments to support its decision:
1. Salmag Enterprises vs. Additional Commissioner of Customs (Adj), Tuticorin [2021 (378) E.L.T. 415 (Mad.) ]: The Madras High Court held that the issuance of a show cause notice under Section 124 of the Customs Act is mandatory, even if the importer/exporter had earlier agreed to waive it.
2. Shiv Shakti Trading Co. vs. Commissioner of Customs (Preventive) [2016 (336) E.L.T. 415 (Del)]: The Delhi High Court ruled that in cases involving serious offenses or high stakes, the issuance of a show cause notice cannot be waived.
3. Dharampal Satyapal Ltd. vs. Dy. Commissioner of C. Ex ., Gauhati [2015 (320) E.L.T. 3 (S.C.)]: The Supreme Court emphasized that the validity of an order must be assessed based on the principle of “prejudice” and the test of fair hearing.
4. Automotive Tyre Manufacturers Association vs. Design ated Authority and Others [2011 (2) SCC 258]: The Supreme Court reiterated the importance of providing a reasonable opportunity to be heard before passing orders that have adverse consequences.
Court’s Decision

The Madras High Court concluded that the impugned confiscation order was invalid as it was passed without issuing a mandatory show cause notice under Section 124 of the Customs Act and without affording the petitioner a personal hearing. The court held that the respondent’s actions violated the principles of natural justice and quashed the impugned order.

Directions to the Respondent

The court granted liberty to the respondent to initiate fresh proceedings for the confiscation of goods, recovery of differential customs duty, and imposition of penalties. However, the court directed the respondent to issue a show cause notice to the petitioner under Section 124 of the Customs Act and follow the due procedure established by law, ensuring adherence to the principles of natural justice.

Conclusion

This judgment reinforces the importance of adhering to the principles of natural justice and the mandatory provisions of the Customs Act, particularly Section 124, which requires the issuance of a show cause notice and a reasonable opportunity for a hearing before confiscating goods or imposing penalties. The decision serves as a reminder to authorities to ensure compliance with legal procedures to protect the rights of importers and exporters.

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Source: Madras High Court

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March 28, 2026
Madras High Court upholds CESTAT decision
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 12.03.2026

Madras High Court upholds CESTAT decision

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 Madras High Court recently delivered a significant judgment in CMA No. 499 of 2026, dismissing the appeal filed by the Commissioner of Customs, Chennai VII Commissionerate, and upholding the decision of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) in favor of M/s. Ingram Micro India Pvt Ltd. The case revolved around the issue of laches and the principles of natural justice, with the Court emphasizing the importance of timely adjudication in legal matters.

Background of the Case

The dispute originated in 2007 when M/s. Ingram Micro India Pvt Ltd imported loose optical fiber cables and sought the benefit of a Customs Notification dated 01.03.2005. Upon scrutiny of the imported documents, the Directorate of Revenue Intelligence (DRI) alleged misdeclaration of goods and issued a show-cause notice to the company on 12.03.2007, claiming that the goods needed to be reclassified.

The respondent promptly replied to the show-cause notice, but the Department took an unprecedented 13 years to pass the order-in-original. This delay led M/s. Ingram Micro India Pvt Ltd to challenge the order before the CESTAT in Customs Appeal No. 40860 of 2021. The CESTAT ruled in favor of the respondent, citing the Department’s unexplained delay and the principles of laches.

Appeal to the Madras High Court 

The Commissioner of Customs filed a Civil Miscellaneous Appeal (CMA No. 499 of 2026) before the Madras High Court, challenging the CESTAT’s decision. The Department argued that the pre-amended Section 28 of the Customs Act did not impose any limitation period for reassessment, and therefore, the delay should not have been a factor in rejecting the Department’s case. The Department further contended that remanding the matter back for reassessment would not prejudice the respondent.

Court’s Observations 

The case was heard by Hon’ble Justice. After carefully considering the submissions, the Court upheld the CESTAT’s decision, emphasizing the following key points:
1. Doctrine of Laches: The Court noted that the delay of 13 years in passing the order-in-original was excessive and unjustifiable. It held that the delay was solely attributable to the Department and not the respondent, who had promptly responded to the show-cause notice.
2. Principles of Natural Justice: The Court stressed that the CESTAT’s decision was in line with the principles of natural justice, which require fairness and timely resolution of disputes. The Court stated that keeping disputes perpetually open due to administrative delays would be contrary to these principles.
3. Legal Certainty: The Court highlighted the importance of legal certainty and the need to give a “quietus to the issue.” It emphasized that prolonged delays in adjudication undermine the credibility of the legal process and create unnecessary hardship for the parties involved.
4. No Substantial Question of Law: The Court found no substantial question of law that warranted interference with the CESTAT’s decision. It concluded that the reasons provided by the Tribunal were legally sound and consistent with established judicial principles.
Judgment

The Madras High Court dismissed the appeal filed by the Commissioner of Customs and upheld the CESTAT’s decision in favor of M/s. Ingram Micro India Pvt Ltd. The Court ruled that the Department’s appeal lacked merit and that the respondent was entitled to relief due to the Department’s failure to act within a reasonable timeframe.

Key Takeaways

This judgment underscores the importance of adhering to the principles of natural justice and avoiding undue delays in legal proceedings. The Court’s decision serves as a reminder to government authorities to act promptly and responsibly in discharging their duties, as excessive delays can lead to the dismissal of their claims.

The case also highlights the significance of the doctrine of laches in ensuring fairness and legal certainty. By upholding the CESTAT’s decision, the Madras High Court has reinforced the principle that administrative inefficiency cannot be used to prejudice the rights of individuals or businesses.

Conclusion

The judgment in CMA No. 499 of 2026 is a landmark decision that reiterates the judiciary’s commitment to upholding fairness and accountability in legal proceedings. It serves as a precedent for similar cases where administrative delays have caused undue hardship to parties. The ruling is a victory for M/s. Ingram Micro India Pvt Ltd and a reminder to government departments to prioritize timely and efficient resolution of disputes.

Source: Madras High Court

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March 12, 2026
Madras High Court Quashes DGFT Orders for Violation of Natural Justice in EPCG Authorization
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 11.03.2026

Madras High Court Quashes DGFT Orders for Violation of Natural Justice in EPCG Authorization

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 High Court of Madras recently delivered a significant judgment in Writ Petition No. 14818 of 2025, filed by M/s. Integrated CNC Technologies Pvt. Ltd., represented by its director. The case revolved around the alleged non-fulfillment of export obligations under the Export Promotion Capital Goods (EPCG) scheme and the subsequent imposition of penalties by the Directorate General of Foreign Trade (DGFT).

Background of the Case

M/s. Integrated CNC Technologies Pvt. Ltd., a company engaged in manufacturing machine parts for automobiles and engineering industries, had obtained two EPCG authorizations on February 27, 2008, and June 27, 2008. These authorizations allowed the company to import capital goods at concessional duty rates under the EPCG scheme, with a corresponding export obligation of USD 217,461.36 and USD 148,200, respectively.

The petitioner faced challenges in submitting the required documents to evidence the fulfillment of export obligations. This led to the issuance of a show-cause notice on May 30, 2019, by the DGFT regarding the authorization dated June 27, 2008. The petitioner responded to the notice on March 11, 2020, submitting documentary proof of export obligation completion.

However, on August 24, 2021, the Deputy Director General of Foreign Trade imposed a penalty of ₹50,00,000 on the petitioner for non-fulfillment of export obligations under the authorization dated February 27, 2008. The petitioner claimed that they had not received any show-cause notice or intimation of a personal hearing before the order was passed.

Previous Court Proceedings 

The petitioner challenged the penalty order in W.P. No. 22703 of 2021 before the High Court of Madras. On June 24, 2024, the Court allowed the writ petition and directed the adjudicating authority to issue a fresh show-cause notice and provide the petitioner with an opportunity for a personal hearing before passing any orders.

Current Case Details

Despite submitting relevant documents on September 25, 2024, to evidence the completion of export obligations, the petitioner was informed that the Joint Director General of Foreign Trade had already passed an order on August 21, 2024. This order imposed a penalty of ₹1,00,000 and demanded customs duty for the unfulfilled export obligations. The petitioner claimed that the order was not served to them and was only uploaded on the DGFT website.

The petitioner filed an appeal against the order before the Appellate Authority and Zonal Additional Director General of Foreign Trade. However, the appeal was dismissed on January 21, 2025, on the grounds of being time-barred. Subsequently, the petitioner approached the High Court of Madras, challenging both the original order and the appellate order.

Court’s Observations and Judgment

The petitioner argued that they were not given proper notice or an opportunity for a personal hearing, as all communications were uploaded only on the DGFT website. The respondents, represented by the Additional Solicitor General, contended that the documents were sent to the email ID provided by the petitioner at the time of obtaining the license, which was accessible to the petitioner.

After hearing both parties, the Court quashed the impugned orders and remitted the matter back to the Joint Director General of Foreign Trade with specific directions:
1. The petitioner must appear before the Joint Director General of Foreign Trade at 11:30 AM on February 23, 2026, for a personal hearing and submission of relevant documents.
2. If the petitioner fails to appear on the specified date, no further opportunity for a hearing will be provided, and the impugned order will stand revived.
Conclusion

The judgment underscores the importance of procedural fairness and the right to a personal hearing in adjudicatory proceedings. By remitting the matter back to the adjudicating authority, the High Court has ensured that the petitioner is given a fair opportunity to present their case and submit evidence of compliance with export obligations.

This case serves as a reminder to businesses to maintain updated contact information with regulatory authorities and to monitor official communications closely. It also highlights the judiciary’s role in safeguarding the principles of natural justice and ensuring that administrative actions are conducted in a fair and transparent manner.

Source: Madras High Court

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March 11, 2026
Madras High Court Upholds Classification of Roasted Areca Nuts Under Customs Tariff Heading 2008
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 05.03.2026

Madras High Court Upholds Classification of Roasted Areca Nuts Under Customs Tariff Heading 2008

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.

On August 1, 2023, the High Court of Madras delivered a significant judgment in the case of C.M.A. Nos. 600, 1206, and 1750 of 2023, addressing the classification of roasted areca nuts (betel nuts) under the Customs Tariff Act, 1975. The case revolved around whether roasted areca nuts should be classified under Customs Tariff Heading (CTH) 2008 19 20 or under CTH 0802 80. The court upheld the ruling of the Customs Authority for Advance Rulings (CAAR), affirming that roasted areca nuts fall under CTH 2008 19 20.

Background of the Case

The case was brought before the High Court by the Commissioner of Customs, Chennai II Commissionerate, challenging the rulings of the CAAR. The respondents, importers of roasted areca nuts, had filed applications with the CAAR seeking advance rulings on the classification of their products. The importers argued that roasted areca nuts should be classified under CTH 2008 19 20, which covers “other roasted nuts and seeds” under Chapter 20 of the Customs Tariff Act.

The Commissioner of Customs contended that roasted areca nuts should be classified under CTH 0802 80, which covers “other nuts, fresh or dried, whether or not shelled or peeled.” The Commissioner argued that roasted areca nuts are not commercially distinct from regular areca nuts and should therefore fall under Chapter 8.

Key Issues in the Case

The primary issue before the court was whether roasted areca nuts should be classified under CTH 2008 19 20 or CTH 0802 80. The court considered the following factors:
1. Distinction Between Roasting and Drying: The court examined whether the process of roasting is distinct from drying and whether it alters the classification of areca nuts.
2. Specific vs. General Tariff Entries: The court analyzed whether roasted areca nuts should be classified under the specific entry for roasted nuts in Chapter 20 or the general entry for fresh or dried areca nuts in Chapter 8.
3. HSN Explanatory Notes: The court considered the Harmonized System of Nomenclature (HSN) Explanatory Notes, which provide guidance on the classification of goods under the Customs Tariff Act.
4. Precedents and Common Parlance Test: The court reviewed previous judgments and rulings, including the Supreme Court’s decision in Crane Betel Nut Powder Works v. Commissioner of Customs & Central Excise and the Tribunal’s ruling in S.T. Enterprises v. Commissioner of Customs, to determine their relevance to the case.
Court’s Observations and Findings 

1. Roasting vs. Drying 

The court noted that roasting is a distinct process from drying, as outlined in the Customs Tariff Act and HSN Explanatory Notes. Roasting involves subjecting areca nuts to high temperatures (130–150°C), which alters their physical and chemical characteristics, distinguishing them from dried areca nuts.

2. Specific vs. General Tariff Entries

The court emphasized the principle that specific tariff entries take precedence over general ones. While Chapter 8 covers fresh or dried areca nuts, Chapter 20 specifically includes roasted nuts under CTH 2008 19 20. The court held that roasted areca nuts should be classified under the specific entry for roasted nuts.

3. HSN Explanatory Notes 

The court highlighted the importance of HSN Explanatory Notes in determining tariff classifications. The notes explicitly classify roasted areca nuts under Chapter 20, supporting the CAAR’s ruling.

4. Precedents and Common Parlance Test

The court clarified that the judgments in Crane Betel Nut Powder Works and S.T. Enterprises were not applicable to the present case, as they dealt with different processes (boiling and drying) and tariff entries. The court also stated that the common parlance test is irrelevant when a specific tariff entry exists.

Conclusion

The High Court of Madras dismissed the appeals filed by the Commissioner of Customs, affirming the CAAR’s ruling that roasted areca nuts are classifiable under CTH 2008 19 20. The court concluded that the process of roasting is distinct from drying and that roasted areca nuts fall under a specific tariff entry, which prevails over the general entry for fresh or dried areca nuts. This judgment underscores the importance of adhering to specific tariff classifications and the relevance of HSN Explanatory Notes in resolving disputes related to the Customs Tariff Act. It also highlights the principle that specific entries in tariff classifications take precedence over general entries, even if the products in question are not commercially distinct.

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Source: Madras High Court

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March 5, 2026
High Court of Madras Quashes Customs Department Order
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 10.02.2026

High Court of Madras Quashes Customs Department Order

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.

On February 2, 2026, the High Court of Madras delivered a landmark judgment in the case of WP No. 5786 of 2025, brought forward by M/s. Autoprint Machinery Manufactures Pvt Ltd. The case revolved around the interpretation of Section 149 of the Customs Act, 1962, and the validity of a circular issued by the Central Board of Excise and Customs (CBEC) that imposed a time limit for filing applications to amend shipping bills.

This blog delves into the details of the case, the arguments presented, and the implications of the judgment.

Background of the Case

The petitioner, M/s. Autoprint Machinery Manufactures Pvt Ltd, filed a writ petition under Article 226 of the Constitution of India, challenging the impugned order passed by the Commissioner of Customs (Respondent No. 1). The order, dated November 21, 2024, rejected the petitioner’s application for amending shipping bills under Section 149 of the Customs Act, citing Circular No. 36/2010-Customs issued by CBEC, which imposed a time limit for such amendments.

The petitioner argued that Section 149 of the Customs Act does not prescribe any time limit for filing applications for amendments to shipping bills or bill of entries. Therefore, the CBEC circular was deemed to be ultra vires and beyond the scope of the statute.

Key Issue in the Case

The primary issue before the court was whether the CBEC could issue a circular fixing a time limit for filing applications for amendments under Section 149 of the Customs Act, despite the absence of any such provision in the statute.

Arguments Presented
1. Petitioner’s Argument:
  - The petitioner contended that the CBEC circular was invalid as it imposed a time limit that was not prescribed under Section 149 of the Customs Act.
  - The petitioner’s counsel relied on various judgments from Constitutional Courts across India, which consistently held that statutory provisions cannot be overridden or restricted by administrative circulars.
2. Respondents’ Argument:
  - The respondents argued that the circular was issued in accordance with the law and was valid.
  - They also informed the court that the same issue was pending before the Hon’ble Supreme Court in S.L.P. No. 38482 of 2025, but admitted that no stay had been granted by the Supreme Court on the matter.
The Court’s Observations

Justice, presiding over the case, made the following observations:
1. No Time Limit in Section 149:
  - The court noted that Section 149 of the Customs Act does not prescribe any specific time limit for filing applications to amend shipping bills or bill of entries. Therefore, the CBEC circular imposing a time limit was deemed to be inconsistent with the statute.
2. Consistency in Judicial Precedents:
  - The court referred to previous judgments from various Constitutional Courts, which had consistently held that administrative circulars cannot impose restrictions that are not explicitly provided for in the statute.
3. Pending Supreme Court Case:
  - While the respondents highlighted that the issue was under consideration by the Supreme Court, the court clarified that no stay had been granted by the apex court. Hence, the High Court was not bound to defer its decision.
4. Equal Treatment for Importers/Exporters:
  - The court emphasized that there cannot be different standards for different importers/exporters. The petitioner should not be penalized simply because the Customs Department had filed an SLP before the Supreme Court.
The Judgment

The High Court of Madras quashed the impugned order passed by the Commissioner of Customs and remanded the matter back to the 1st respondent for fresh consideration. The court directed the following:
1. The 1st respondent must reconsider the petitioner’s application for amendment of shipping bills on merits and in accordance with the law.
2. The 1st respondent must not rely on Circular No. 36/2010-Customs dated 23.09.2010 while making the decision.
3. The petitioner must be given an adequate opportunity for a personal hearing, adhering to the principles of natural justice.
4. The final order must be passed within 12 weeks from the date of receipt of the court’s order.
5. The petitioner must be allowed to pay the appropriate fees for the application seeking amendment of shipping bills.
The court also clarified that the final decision of the 1st respondent would be subject to the outcome of the pending Supreme Court case in S.L.P. No. 38482 of 2025.

Implications of the Judgment

This judgment is significant for importers and exporters across India as it reinforces the principle that administrative circulars cannot override statutory provisions. By quashing the CBEC circular, the court has upheld the supremacy of the Customs Act and ensured that businesses are not unfairly penalized due to arbitrary time limits imposed by administrative authorities.

The decision also highlights the importance of adhering to the principles of natural justice, ensuring that affected parties are given a fair opportunity to present their case.

Conclusion

The High Court of Madras has once again demonstrated its commitment to upholding the rule of law and protecting the rights of businesses. The judgment in WP No. 5786 of 2025 serves as a reminder that administrative authorities must act within the bounds of the law and cannot impose restrictions that are not explicitly provided for in the statute.

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Source: Madras High Court

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February 10, 2026
Madras High Court Quashes Customs Order for Non-Adherence to Mandatory Timelines Under CBLR- 2018
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 09.02.2026

Madras High Court Quashes Customs Order for Non-Adherence to Mandatory Timelines Under CBLR- 2018

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 Madras High Court, in a landmark judgment dated January 29, 2026, has quashed an order passed by the Principal Commissioner of Customs (General), Chennai Customs Zone, for failing to adhere to the mandatory timelines prescribed under the Customs Brokers Licensing Regulations (CBLR), 2018. The case, WP No. 27861 of 2025, was presided over by the Honourable Justice.

Background of the Case

The petitioner, M/s. Shriwin Shipping and Logistics, represented by its partner, filed a writ petition challenging the impugned order in Original No. 113023/2025 dated April 7, 2025. The order imposed a penalty of ₹15,000 under Regulation 18 of CBLR, 2018. The petitioner argued that the order was passed without jurisdiction, authority of law, and in violation of the principles of natural justice and fundamental rights guaranteed under the Constitution of India.

The petitioner contended that the respondent failed to adhere to the mandatory timelines prescribed under Regulation 17 of CBLR, 2018, which stipulates that the entire proceedings must be completed within nine months from the date of the offence report. In this case, the show-cause notice issued on June 27, 2024, was considered the offence report, and the proceedings should have been completed by March 26, 2025. However, the impugned order was passed on April 7, 2025, exceeding the prescribed timeline.

Court’s Observations

Justice Abdul Quddhose noted that the Division Bench of the Madras High Court had previously ruled in the case of M/s. Santon Shipping Services vs. The Commissioner of Customs, Tuticorin and Another (judgment dated October 13, 2017) that the timelines under CBLR, 2018, are mandatory and must be strictly adhered to. This precedent has been consistently upheld in subsequent cases by the Madras High Court.

The respondent argued that the timelines under CBLR, 2018, are directory rather than mandatory, citing decisions from other High Courts. However, the Madras High Court rejected this contention, emphasizing that the Division Bench’s judgment remains binding and has not been overruled by the Supreme Court.

Key Takeaways from the Judgment
1. Mandatory Nature of Timelines: The court reaffirmed that the timelines prescribed under Regulation 17 of CBLR, 2018, are mandatory and must be strictly followed. Any deviation from these timelines renders the proceedings invalid.
2. Adherence to Precedent: The court emphasized the importance of adhering to its own precedents, particularly the Division Bench judgment in M/s. Santon Shipping Services, which has consistently been followed in similar cases.
3. Violation of Natural Justice: The court highlighted that the impugned order was passed without following due procedures of law, violating the principles of natural justice and the petitioner’s fundamental rights.
4. Quashing of Impugned Order: The court quashed the impugned order dated April 7, 2025, and allowed the writ petition, citing the respondent’s failure to comply with the mandatory timelines.
Implications of the Judgment

This judgment serves as a significant reminder to authorities to strictly adhere to the timelines prescribed under the Customs Brokers Licensing Regulations, 2018. It underscores the importance of procedural compliance and the protection of fundamental rights in administrative proceedings. The decision also highlights the judiciary’s role in upholding the rule of law and ensuring that government authorities act within the bounds of their jurisdiction.

Conclusion

The Madras High Court’s decision in WP No. 27861 of 2025 is a landmark ruling that reinforces the mandatory nature of timelines under CBLR, 2018. It sets a strong precedent for similar cases and ensures that administrative authorities are held accountable for adhering to legal procedures. This judgment is a victory for the principles of natural justice and the protection of fundamental rights, and it serves as a crucial reference point for future cases involving the Customs Brokers Licensing Regulations.

Source: Madras High Court

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February 9, 2026
Madras High Court Issues Writ of Mandamus Directing Release of Confiscated Imported Goods Under Quality Control Order
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 01.01.2026

Madras High Court Issues Writ of Mandamus Directing Release of Confiscated Imported Goods Under Quality Control Order

This Article has been written by Shri Ravi Shekhar Jha, Advocate 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 legal development, the Madras High Court recently ruled in favor of Urban Essentials India Pvt. Ltd., directing the Commissioner of Customs, Chennai – II (Import), to release the company’s imported goods. The case, W.P.No.50475 of 2025, revolved around the import of feminine hygiene products and the applicability of the Medical Textiles (Quality Control) Order, 2024, issued by the Ministry of Textiles.

Background of the Case

Urban Essentials India Pvt. Ltd., represented by its director, is a Chennai-based importer of feminine hygiene products, including sanitary napkins and panty liners. These products are manufactured in China using advanced technology unavailable in India and are sold under the brand name “Plush.” The Chinese manufacturer had applied for certification under the Bureau of Indian Standards (BIS) Foreign Manufacturer Certification Scheme, as the products fall under BIS Schedule-A and must comply with BIS standard IS 5045:2019.

The company imported goods under two Bills of Entry dated 29.03.2025 and 31.03.2025. However, an alert notice issued by the Additional Commissioner of Customs on 27.02.2025 raised concerns about the applicability of the Quality Control Order (QCO) on imports. The Department of Promotion of Industry and Internal Trade (DPIIT) clarified that the relaxation granted in the QCOs for obtaining BIS licenses under Conformity Assessment Rules did not apply to imports. This led to the confiscation of the petitioner’s goods under Section 111(d) of the Customs Act, along with penalties and fines.

Legal Proceedings

Urban Essentials India Pvt. Ltd. filed multiple writ petitions to seek the release of their goods. Initially, the High Court directed the Commissioner of Customs to pass orders within four weeks. However, the Customs Department ordered the confiscation of the goods, imposed a fine of ₹10,00,000/- under Section 125(1) of the Customs Act, and levied a penalty of ₹5,00,000/- under Section 112(a)(i) of the Customs Act. The department argued that the goods did not conform to BIS standards and were imported in violation of the QCO.

The petitioner challenged this order in W.P.No.37033 of 2025, but the High Court dismissed the petition, stating that the QCO applied to manufacturers and not importers. The court advised the petitioner to seek an alternate remedy before the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT).

Subsequently, the petitioner filed an appeal before the CESTAT, along with a miscellaneous application seeking interim relief for the release of goods and a stay on the order-in-original. On 22.12.2025, the CESTAT allowed the application, granting a stay on the operation of the impugned order and permitting the provisional release of the goods.

The High Court’s Final Decision

Despite the CESTAT’s order, the Commissioner of Customs did not release the goods, prompting Urban Essentials India Pvt. Ltd. to file another writ petition (W.P.No.50475 of 2025) seeking a writ of mandamus for the release of the goods. The case was heard by the Honourable Justice on 26.12.2025.

After carefully considering the submissions from both sides, the court ruled in favor of the petitioner. Justice noted that the petitioner, as an importer and a registered MSME under the UDYAM Registration Certification, was entitled to the benefit of the extended timeline granted under the second amendment to the QCO dated 30.07.2025. This amendment allowed importers to sell, display, or offer to sell declared stocks up to 31.12.2025, provided the goods were imported before 01.04.2025.

The court also emphasized the importance of adhering to judicial orders under Article 261 of the Constitution of India, which mandates “full faith and credit” to judicial decisions. Since the CESTAT had already stayed the order-in-original and allowed the petitioner’s application for provisional release, the High Court directed the Commissioner of Customs to comply with the CESTAT’s order.

Key Takeaways from the Judgment
1. Recognition of MSMEs: The court acknowledged the petitioner’s status as a registered MSME and upheld its entitlement to the extended timeline under the QCO amendment.
2. Judicial Authority: The judgment reinforced the principle that judicial orders from quasi-judicial authorities like the CESTAT must be respected and implemented.
3. Provisional Release of Goods: The court ordered the release of the goods, subject to the petitioner depositing ₹15,00,000/- with the respondent within 24 hours. This deposit was to be made without prejudice to the rights of the parties, ensuring that the ongoing appeal before the CESTAT would not be influenced by the High Court’s observations.
Conclusion

The Madras High Court’s decision in favor of Urban Essentials India Pvt. Ltd. is a significant victory for importers and MSMEs navigating complex regulatory frameworks. It highlights the importance of judicial oversight in ensuring fair treatment and compliance with statutory provisions. As the case proceeds to the CESTAT for final adjudication, this judgment serves as a reminder of the judiciary’s role in upholding the rights of businesses while balancing regulatory compliance.

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Source: Madras High Court

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January 1, 2026
Madras High Court Declares GST Notifications Illegal
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 23.12.2025

Madras High Court Declares GST Notifications Illegal

This Article has been written by Shri Ravi Shekhar Jha, Advocate 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.

On December 17, 2025, the Madurai Bench of the Madras High Court delivered a landmark judgment in favor of Tvl Voylla Fashions Private Limited, represented by its authorized signatory. The case, W.P. (MD) No. 36017 of 2025, challenged the validity of two GST notifications issued by the Union of India: Notification No. 09/2023-Central Tax dated 31.03.2023 and Notification No. 56/2023-Central Tax dated 28.12.2023. The court ruled these notifications as vitiated and illegal, marking a significant victory for the petitioner.

Background of the Case

The petitioner, Tvl Voylla Fashions Private Limited, filed a writ petition under Article 226 of the Constitution of India, seeking a writ of certiorari to quash the impugned notifications and the consequential assessment order passed by the Assistant Commissioner (ST) (FAC) for the assessment year 2019-2020. The petitioner argued that the notifications violated several constitutional provisions, including Article 14, 246A, and 265, and were ultra vires Section 168A of the Central Goods and Services Tax Act, 2017.

The petitioner contended that the notifications were issued retrospectively, curtailing the limitation period for assessment and adjudication under the CGST Act. This, they argued, was contrary to the Supreme Court’s order dated January 10, 2022, which excluded the period from March 15, 2020, to February 28, 2022, for the purpose of calculating the limitation period under Section 73 of the CGST Act.

Key Arguments and Court Observations

During the hearing, the learned counsel for the petitioner and the Additional Government Pleader representing the respondents presented their arguments. The court noted that the issue raised in this case had already been addressed in a previous judgment delivered on June 12, 2025, in W.P. Nos. 17184 of 2024, where the court had categorically held that:
1. The authorities under the CGST Act are entitled to exclude the period from March 15, 2020, to February 28, 2022, while calculating the limitation period under Section 73 of the CGST Act, as per the Supreme Court’s order under Article 142 of the Constitution.
2. The impugned notifications were vitiated and illegal for several reasons:
  - They curtailed the limitation period contrary to the Supreme Court’s order under Article 142.
  - They were based on erroneous assumptions and misconceptions about the scope and effect of the Supreme Court’s order.
  - They arbitrarily extinguished the vested rights of action available to authorities under the CGST Act.
  - Notification No. 56/2023 was issued without the recommendations of the GST Council, violating the statutory mandate.
The court also highlighted issues such as the violation of principles of natural justice, lack of jurisdiction, and errors apparent on the face of the record.

The Court’s Decision

After considering the submissions and referring to the earlier judgment, the Honorable Justice ruled in favor of the petitioner. The court declared the impugned notifications as vitiated and illegal and set aside the consequential assessment order dated August 28, 2024. The court directed the authorities to treat the impugned order as a show cause notice and allowed the petitioner to submit objections within 8 weeks. The authorities were instructed to pass fresh orders after providing the petitioner an opportunity for a hearing.

Implications of the Judgment

This judgment is a significant victory for taxpayers and businesses, as it reinforces the importance of adhering to constitutional principles and statutory mandates while issuing notifications under the GST framework. The court’s decision highlights the following key points:
1. Protection of Vested Rights: The judgment ensures that taxpayers’ rights are not arbitrarily curtailed by retrospective notifications that diminish the limitation period for assessment and adjudication.
2. Adherence to Supreme Court Orders: The ruling underscores the importance of complying with the Supreme Court’s directives, particularly those issued under Article 142 of the Constitution.
3. Role of the GST Council: The judgment reiterates the statutory requirement for the GST Council’s recommendations before issuing notifications, ensuring transparency and accountability in the decision-making process.
Conclusion

The Madurai Bench of the Madras High Court has once again demonstrated its commitment to upholding the rule of law and protecting the rights of taxpayers. The victory of Tvl Voylla Fashions Private Limited serves as a reminder to authorities to exercise their powers within the bounds of the law and constitutional principles. This case sets a precedent for future challenges to arbitrary and retrospective notifications, ensuring a fair and just taxation system for all stakeholders.

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Source: Madras High Court

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December 23, 2025
Madras High Court Quashes Customs Inquiry Report for Breach of Mandatory Timelines Under CBLR, 2018
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 10.12.2025

Madras High Court Quashes Customs Inquiry Report for Breach of Mandatory Timelines Under CBLR, 2018

This Article has been written by Shri Ravi Shekhar Jha, Advocate 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 Madras High Court, in a significant judgment delivered on September 18, 2025, quashed an inquiry report issued by the Deputy Commissioner of Customs under Regulation 17 of the Customs Brokers Licensing Regulations, 2018 (CBLR, 2018). The case, titled M/s. Sea Queen Shipping Services Private Limited vs. The Commissioner of Customs & Anr. , was presided over by Honourable Justice.

Background of the Case

The petitioner, M/s. Sea Queen Shipping Services Private Limited, challenged the inquiry report dated June 27, 2025, issued by the second respondent, the Deputy Commissioner of Customs. The report alleged violations of Regulation 10(q) of the CBLR, 2018, and recommended further proceedings. The petitioner contended that the report was illegal, arbitrary, and issued beyond the mandatory timeline prescribed under Regulation 17(5) of the CBLR, 2018.

The case stemmed from an investigation into an importer, M/s. Anomsoft Solutions Private Limited, which revealed discrepancies between the imported goods and the business activities mentioned in the GST numbers of the importer. The petitioner, acting as the customs broker, filed the Bills of Entry for the importer. Following the investigation, the Principal Commissioner of Customs suspended the petitioner’s customs broker license on December 21, 2024, under Regulation 16(1) of the CBLR, 2018. Subsequent inquiry proceedings under Regulation 17 were initiated, leading to the issuance of a show-cause notice on January 17, 2025.

Key Issues Raised

The petitioner raised two primary issues in the writ petition:
1. The inquiry report was submitted beyond the mandatory 90-day timeline prescribed under Regulation 17(5) of the CBLR, 2018, thereby vitiating the proceedings.
2. The petitioner was not afforded an opportunity to cross-examine witnesses, violating the principles of natural justice as per Regulation 17(4) of the CBLR, 2018.
Court’s Observations and Judgment

The Court examined the arguments presented by both parties and referred to multiple precedents, including judgments from the Madras High Court and the Delhi High Court. It reiterated that the 90-day timeline under Regulation 17(5) of the CBLR, 2018, is mandatory and not directory. The Court emphasized that exceeding this timeline results in the abatement of proceedings, as established by previous judicial pronouncements.

The respondents argued that the delay in submitting the inquiry report was due to the petitioner’s repeated requests for time during the personal hearing. However, the Court noted that the 90-day period had already expired by the time the first hearing was scheduled on April 28, 2025. Therefore, any subsequent delays could not justify the violation of the mandatory timeline.

The Court also addressed the issue of estoppel, stating that the petitioner’s participation in the proceedings does not negate the mandatory nature of the timeline under Regulation 17(5). Furthermore, the Court found that the inquiry report was not communicated to the petitioner within the stipulated time, further violating the regulations.

Conclusion

In its judgment, the Madras High Court allowed the writ petition and set aside the impugned inquiry report dated June 27, 2025. The Court held that the proceedings stood abated due to the violation of the mandatory timeline under Regulation 17(5) of the CBLR, 2018. The Court also deemed it unnecessary to address the second issue regarding the alleged violation of natural justice.

This judgment underscores the importance of adhering to mandatory timelines in regulatory proceedings and reinforces the principle that procedural lapses can vitiate the entire process. It serves as a reminder to authorities to strictly comply with statutory requirements to ensure fairness and transparency in administrative actions.

Source: Madras High Court

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December 10, 2025
Madras High Court Quashes Service Tax Notifications and IGST on Ocean Freight as Ultra Vires
ALO Law Office- IDT Tax I Arbitration I Litigation

Date: 10.12.2025

Madras High Court Quashes Service Tax Notifications and IGST on Ocean Freight as Ultra Vires

This Article has been written by Shri Ravi Shekhar Jha, Advocate 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 judgment dated October 13, 2025, the Madurai Bench of the Madras High Court, comprising Honourable Justice, delivered a landmark ruling in the cases W.P. (MD) Nos. 1139 & 1143 of 2021 and 14856 & 14857 of 2022. The court declared certain service tax notifications and the imposition of Integrated Goods and Services Tax (IGST) on ocean freight as ultra vires, providing relief to the petitioners.

Background of the Case

The petitions were filed by M/s. TVS Srichakra Limited and M/s. Hitech Arai Private Limited, challenging Notifications No. 14/2017, 15/2017, and 16/2017 issued by the Union Ministry of Finance on April 13, 2017. The petitioners argued that these notifications exceeded the scope of Section 68(2) of the Finance Act, 1994, and violated Articles 14, 19(1)(g), 245, and 269A of the Constitution of India. Additionally, the petitioners sought to quash show-cause notices issued for the collection of service tax and IGST on ocean freight for the period between April 2017 and June 2017.

Court’s Observations

The court noted that similar challenges had been addressed by the Madras, Gujarat, and Bombay High Courts in previous cases, including:
1. M/s. Eastman Spinning Mills (P) Limited Vs. Union of India (Madras High Court, 2025)
2. Sal Steels Limited Vs. Union of India (Gujarat High Court, 2020)
3. Santhan Textile Private Limited Vs. Union of India (Bombay High Court, 2024)
The Gujarat High Court, in the Sal Steels case, had struck down the impugned notifications, ruling that they were ultra vires Sections 64, 66B, 67, and 94 of the Finance Act, 1994. The court held that the notifications lacked proper legal backing to impose service tax and IGST on ocean freight under CIF contracts. Similarly, the Madras High Court in the Eastman Spinning Mills case followed the Gujarat High Court’s decision and quashed the notifications.

Key Judgment

The Madurai Bench of the Madras High Court aligned with the earlier rulings and declared the impugned notifications as ultra vires. The court emphasized that the notifications failed to provide a proper mechanism under Section 68(2) of the Finance Act, 1994, to shift the burden of paying service tax and IGST on ocean freight to the petitioners, who were not the recipients of the taxable service. Consequently, the court quashed the notifications and the related show-cause notices, granting relief to the petitioners.

IGST on Freight

IGST on freight is applicable only when the importer directly pays the freight to the transporter, such as in FOB import contracts or domestic freight services. However, in CIF imports, where freight is included in the supplier’s invoice and paid by the foreign exporter, the importer is not liable to pay IGST under reverse charge. The Supreme Court in Union of India vs. Mohit Minerals (2022) declared the levy of IGST on ocean freight under RCM as unconstitutional and resulting in double taxation. Therefore, no IGST is payable on ocean freight in CIF imports as per the settled legal position.

Implications of the Judgment

This judgment is a significant development for businesses involved in import transactions under CIF contracts. The ruling reinforces the position that service tax and IGST on ocean freight cannot be imposed without proper legal authority. It also highlights the importance of adhering to constitutional provisions and ensuring that tax notifications do not exceed the scope of the enabling legislation.

Conclusion

The Madurai High Court’s decision is a welcome relief for businesses, as it sets a precedent for similar cases across the country. By declaring the service tax notifications and IGST on ocean freight as ultra vires, the court has upheld the principles of constitutional validity and provided clarity on the scope of taxation under the Finance Act, 1994. This judgment is expected to have far-reaching implications for the interpretation of tax laws in India.

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Source: Madras High Court

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December 10, 2025