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Tag: #TaxLitigations

  • Karnataka High Court Upholds Conversion of Shipping Bills from MEIS to DEPB Scheme

    Karnataka High Court Upholds Conversion of Shipping Bills from MEIS to DEPB Scheme

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 18.08.2025

    Karnataka High Court Upholds Conversion of Shipping Bills from MEIS to DEPB Scheme​

    In a significant judgment delivered on July 30, 2025, the High Court of Karnataka at Bengaluru dismissed Customs Appeal No. 4 of 2022 filed by the Principal Commissioner of Customs, Bengaluru. ​ The case revolved around the conversion of shipping bills under export promotion schemes, and the court upheld the decision of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Bengaluru, in favor of the Assessee, M/s Louverline Blinds. ​

    Background of the Case

    M/s Louverline Blinds, engaged in the manufacture of motorized curtain and blind assemblies, imported inputs under an Advance Authorization License for manufacturing goods meant for export. ​ The Assessee filed six shipping bills under the Merchandise Export Incentive Scheme (MEIS) but later sought to amend them to reflect exports under the Advance Authorization License. The Principal Commissioner of Customs rejected this request, citing Section 149 of the Customs Act, 1962, and Circulars No. ​ 36/2010 and 6/2002. ​

    The Assessee appealed to the CESTAT, which ruled in its favor, allowing the conversion of shipping bills from the MEIS Scheme to the Duty Entitlement Passbook (DEPB) Scheme. ​ The Revenue challenged this decision in the High Court.

    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: Karnataka High Court

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  • Delhi High Court Orders Release of Confiscated Gold Chain

    Delhi High Court Orders Release of Confiscated Gold Chain

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 18.08.2025

    Delhi High Court Orders Release of Confiscated Gold Chain ​ ​ ​ ​

    In a significant ruling on August 7, 2025, the High Court of Delhi addressed the contentious issue of gold jewelry confiscation by customs authorities, setting a precedent for the treatment of personal effects under Indian law. ​ The case involved Appellant, a senior citizen and foreign national from Turkmenistan, who had traveled to India for medical treatment. Upon her arrival at Indira Gandhi International Airport on July 16, 2024, customs officials detained her gold chain (weighing 132 grams) and gold bracelet (weighing 66 grams), citing violations of customs regulations. ​

    Background of the Case

    Appellant filed a petition under Article 226 of the Constitution of India, seeking the release of her confiscated gold items. ​ While the Customs Department allowed her to redeem the gold bracelet upon payment of a fine and penalty, the gold chain was subjected to absolute confiscation. ​ This distinction between the two items raised questions about the legality and rationale behind the customs authorities’ actions.

    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: Delhi High Court

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  • CESTAT Ahmedabad Quashes β‚Ή20 Lakh Penalty on CHA

    CESTAT Ahmedabad Quashes β‚Ή20 Lakh Penalty on CHA

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 16.08.2025

    CESTAT Ahmedabad Quashes β‚Ή20 Lakh Penalty on CHA ​ ​ ​ ​

    In a significant judgment, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Ahmedabad, has set aside the penalty of β‚Ή20,00,000 imposed on Appellant, Manager of Customs House Agent (CHA) firm M/s. Shree Maruti Shipping Services. ​ The decision, delivered by Hon’ble Judicial, highlights the importance of adhering to principles of natural justice and the need for cogent evidence in penalty proceedings under the Customs Act, 1962.

    Background of the Case

    The case originated from an investigation by the Directorate of Revenue Intelligence (DRI), Mumbai, into the import of 208 MT of HDPE valued at β‚Ή54,07,418 under an allegedly forged advance license. ​ The investigation revealed discrepancies in the import documents, including the use of a non-existent firm, M/s. ​ Roha Dye Chem Pvt Ltd, as the importer. ​ The CHA firm, M/s. ​ Shree Maruti Shipping Services, was involved in processing the customs clearance documents. ​

    Initially, the Commissioner of Customs, Kandla, imposed a penalty of β‚Ή5,00,000 on Appellant under Section 112(b) of the Customs Act, 1962. ​ However, after multiple rounds of adjudication and remand proceedings, the penalty was enhanced to β‚Ή20,00,000 under Section 112(a) in the impugned order dated 24th September 2012. ​ Aggrieved by this decision, Appellant filed an appeal before the CESTAT.

    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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  • CESTAT Mumbai- Customs Cannot Deny DFIA and AA Exemptions Once DGFT Confirms Export Obligation

    CESTAT Mumbai- Customs Cannot Deny DFIA and AA Exemptions Once DGFT Confirms Export Obligation

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 16.08.2025

    CESTAT Mumbai- Customs Cannot Deny DFIA and AA Exemptions Once DGFT Confirms Export Obligation

    In a significant ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai, has set aside the duty demand and penalties imposed on M/s. ​ Tejus, a Surat-based importer, in connection with alleged misuse of Duty-Free Import Authorization (DFIA) and Advance Authorization (AA) schemes. ​ The case, which revolved around the interpretation of export obligation and post-importation conditions, has brought clarity to the jurisdictional limits of Customs authorities in such matters. ​

    Background of the Case

    M/s. Tejus, holding Import Export Code (IEC) No. ​ 349001499, had obtained DFIA and AA licenses for importing polyester filament yarn (PFY) and textured filament yarn (TFY). ​ The Directorate of Revenue Intelligence (DRI) alleged that the company had diverted imported goods to the local market without fulfilling the actual user conditions. ​ Following an investigation, the Commissioner of Customs (Export), Raigad, confirmed a duty demand of β‚Ή5.21 crore, along with penalties and redemption fines, citing violations of the Customs Act, 1962. ​

    The appellant challenged the order, arguing that the Customs authorities lacked jurisdiction to demand duty once the Export Obligation Discharge Certificate (EODC) was issued by the Directorate General of Foreign Trade (DGFT). ​ The appellant relied on precedents set by the Supreme Court and Bombay High Court, which held that Customs authorities cannot refuse exemptions based on allegations of misrepresentation if the licensing authority has not questioned the validity of the license.

    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 Mumbai

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  • CESTAT Hyderabad Quashes Penalties on Alleged Smuggling of Foreign-Origin Gold

    CESTAT Hyderabad Quashes Penalties on Alleged Smuggling of Foreign-Origin Gold

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 14.08.2025

    CESTAT Hyderabad Quashes Penalties on Alleged Smuggling of Foreign-Origin Gold ​ ​ ​

    On August 13, 2025, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Hyderabad, delivered a significant judgment in a series of appeals concerning the confiscation of smuggled gold, sale proceeds, and penalties imposed under the Customs Act, 1962. The case involved multiple appellants and revolved around the seizure of 40 gold bars with foreign markings and substantial cash, allegedly linked to smuggling activities. This blog delves into the key aspects of the case and the tribunal’s decision.

    Background of the Case

    The case originated from a seizure conducted by the Directorate of Revenue Intelligence (DRI) on November 21, 2019, at a residence in Secunderabad. The officers discovered 40 gold bars weighing 100 grams each, marked “AL ETIHAD DUBAI – UAE 100G 999.0,” along with cash totaling Rs. ​ 1,99,97,700. The gold and cash were concealed in a specially designed compartment of a vehicle. ​ Statements from the appellants revealed a complex network of transactions involving smuggled gold transported from Calicut to Hyderabad.

    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 Hyderabad

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  • PayTM gets Duty benefits and Penalty waiver relief from CESTAT

    PayTM gets Duty benefits and Penalty waiver relief from CESTAT

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 14.08.2025

    PayTM gets Duty benefits and Penalty waiver relief from CESTAT

    The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) recently delivered a significant judgment in the case of One97 Communications Limited (Paytm) regarding the import of Paytm Soundbox Versions 1 and 2. The case revolved around whether these devices were eligible for a concessional rate of Basic Customs Duty (BCD) under Serial No. ​ 20 of Notification No. ​ 57/2017. This blog delves into the details of the case, the arguments presented, and the final decision.

    Background of the Case

    One97 Communications Limited, the parent company of Paytm, imported Paytm Soundbox devices between 2019 and 2022. These devices are portable audio-activated smart devices that notify merchants of successful payments made by customers. ​ The company classified these devices under Customs Tariff Item (CTI) 8517 62 90 and claimed a concessional BCD rate of 10% under Serial No. ​ 20 of Notification No. ​ 57/2017.

    However, the customs department issued two show-cause notices alleging that the devices were 4G LTE compliant and therefore fell under the exclusionary clauses of the notification, making them ineligible for the concessional duty rate. ​ The department demanded differential duty and imposed 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 Delhi

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  • CESTAT Mumbai Quashes Customs Reclassification of Scrap and Orders Refund with Interest

    CESTAT Mumbai Quashes Customs Reclassification of Scrap and Orders Refund with Interest

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 13.08.2025

    CESTAT Mumbai Quashes Customs Reclassification of Scrap and Orders Refund with Interest ​ ​ ​

    In a landmark decision, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai, has delivered justice to M/s. Shreem Worldwide Private Limited, an importer who faced significant penalties and fines due to the reclassification of their imported goods. ​ The case, which revolved around the classification and valuation of imported “Heavy Melting Scrap,” highlights the importance of expert opinions and adherence to established legal principles in customs disputes. ​

    Background of the Case

    The dispute began when M/s. Shreem Worldwide Private Limited imported a consignment of “Heavy Melting Scrap” from the UAE, declaring its value as β‚Ή19,42,688/- and paying the applicable duty of β‚Ή3,27,429/-. ​ However, upon examination by Docks Officials, the goods were reclassified as “serviceable used iron pipes, rusted and corroded,” leading to a reassessment of their value and imposition of a redemption fine of β‚Ή3,00,000/- and a penalty of β‚Ή50,000/-. ​ The importer contested this decision, citing a Chartered Engineer’s report that certified the pipes as discarded and unserviceable in their present form. ​ Despite this expert opinion, the Commissioner of Customs (Appeals) upheld the adjudication order, prompting the importer to escalate the matter to 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 Mumbai

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  • CESTAT Chennai- Delay in EODC Issuance Beyond Importer’s Control

    CESTAT Chennai- Delay in EODC Issuance Beyond Importer’s Control

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 13.08.2025

    CESTAT Chennai- Delay in EODC Issuance Beyond Importer’s Control

    In a significant ruling, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Chennai, has set aside a duty demand against M/s. Mohan Breweries & Distilleries Ltd. under the Export Promotion Capital Goods (EPCG) Scheme. ​ The case highlights the importance of procedural fairness and the role of government authorities in facilitating compliance with export obligations. ​

    Background of the Case

    M/s. Mohan Breweries & Distilleries Ltd. was issued an EPCG license for importing capital goods at a concessional duty rate under Customs Notification No. 55/2003. The company undertook to fulfill export obligations equivalent to eight times the duty saved within eight years. ​ However, the Customs Department alleged non-compliance due to the non-submission of the Export Obligation Discharge Certificate (EODC) and issued a demand for Rs. ​ 8,18,647/- along with applicable interest. ​ The appellant contended that they had fulfilled their export obligations and had applied for the EODC with the Directorate General of Foreign Trade (DGFT). ​ Despite this, the Commissioner of Customs (Appeals-II) rejected their request to transfer the case to the call book and upheld the duty demand.

    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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  • CESTAT Mumbai- Customs authorities cannot overstep their jurisdiction by questioning MEIS benefits without the DGFT’s intervention

    CESTAT Mumbai- Customs authorities cannot overstep their jurisdiction by questioning MEIS benefits without the DGFT’s intervention

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 12.08.2025

    CESTAT Mumbai- Customs authorities cannot overstep their jurisdiction by questioning MEIS benefits without the DGFT’s intervention

    The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai, recently delivered a significant judgment in the case of Heranba Industries Ltd. vs. Commissioner of Customs, NS-II, Nhava Sheva. This case revolved around the classification of exported goods under the Merchandise Export India Scheme (MEIS) and the jurisdiction of customs authorities to demand recovery of export benefits. ​ The Tribunal’s decision not only clarified the scope of jurisdiction under the Foreign Trade Policy (FTP) but also reinforced the principles of limitation in adjudication proceedings.

    Background of the Case

    Heranba Industries Ltd., a manufacturer of pesticides and insecticides, exported products under the MEIS scheme, claiming benefits at 3% of the Free on Board (FOB) value based on their classification under specific tariff headings (CTH 38089910/38089990). ​ The Directorate General of Revenue Intelligence (DRI) and the Special Intelligence and Investigation Branch (SIIB) later alleged misclassification, claiming the products should have been classified under different headings (CTH 38086100/38086200/38086900), which were either ineligible for MEIS benefits or entitled to a lower rate of 2%. ​

    The customs authorities issued two separate show cause notices (SCNs) for overlapping periods, invoking the extended period of limitation and demanding recovery of MEIS benefits. ​ The second SCN, issued by SIIB, became the subject of this appeal.

    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 Mumbai

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  • CESTAT Delhi Sets Aside Penalty on Customs Broker in CVD Assessment Dispute

    CESTAT Delhi Sets Aside Penalty on Customs Broker in CVD Assessment Dispute

    ALO Law Office- IDT Tax I Arbitration I Litigation

    Date: 12.08.2025

    CESTAT Delhi Sets Aside Penalty on Customs Broker in CVD Assessment Dispute ​ ​ ​

    In a significant ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, has set aside the penalty imposed on M/s. ​ AV Global Corporation (P) Ltd., a Customs House Agent (CHA), in a case involving the assessment of Countervailing Duty (CVD) on imported CNG kits and components. ​ The decision, delivered by Judicial, highlights the importance of judicial discretion in penalty imposition and the burden of proof on the department in cases of alleged suppression of facts.

    Background of the Case

    The case arose from an investigation by the Customs Department, which alleged that M/s. ​ Shrimanker Gas Car Services Pvt. ​ Ltd. (the importer) had evaded customs duties by paying CVD based on the transaction value of imported CNG kits instead of the Retail Sale Price (RSP), as mandated under the Customs Tariff Act, 1975, and related provisions. ​ The department issued a show cause notice proposing recovery of Rs. ​ 12,11,469/- along with interest and penalties. ​ M/s. AV Global Corporation, acting as the CHA for the importer, was also penalized under Section 112(a) of the Customs Act, 1962, for allegedly abetting the importer in the short payment of duty. The penalty of Rs. ​ 18,000/- was imposed on the CHA, which was upheld in the Order-in-Appeal. ​ Aggrieved, the CHA approached 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 Delhi

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