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CESTAT Bangalore Affirms Importer’s Classification of Airspan Air Velocity 2700 Under CTH 8517 6260
Aadrikaa Legal Services (ALS) – IDT Tax I Arbitration I Litigation

Date: 01.06.2026

CESTAT Bangalore Affirms Importer’s Classification of Airspan Air Velocity 2700 Under CTH 8517 6260

This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Bangalore, recently delivered a significant ruling in the case of M/s. Anandit Infotech India Pvt Ltd versus the Principal Commissioner of Customs, Bengaluru. The dispute centered on the correct customs tariff classification for the imported Airspan Air Velocity 2700 equipment, a device used in advanced telecommunications networks.

The Dispute

M/s. Anandit Infotech India Pvt Ltd imported the Airspan Air Velocity 2700 and declared it under Customs Tariff Heading (CTH) 8517 6260, which covers Synchronous Digital Hierarchy (SDH) systems. The customs authorities, however, challenged this classification, arguing that the device is a 5G Radio Unit (RU) and should be classified under CTH 8517 6290 (“others”), thereby denying the importer certain duty exemptions.

The Adjudication Authority initially sided with customs, but the Commissioner (Appeals) overturned this decision, accepting the importer’s classification. The Revenue then appealed to the Tribunal.

Key Arguments
- Customs Authorities: Asserted that the Air Velocity 2700 is a 5G Radio Unit, not SDH equipment, and pointed to technical documentation showing its primary function as wireless access for 5G networks.
- Importer (Anandit Infotech): Emphasized that the device functions as a router, synchronizing and routing 5G signals, and provided catalogues, technical literature, and a WPC license to support their claim. They also highlighted that the equipment was imported for R&D and networking purposes, and referenced a “No Objection” letter from the buyer describing it as a “5G Router Kit.”
Legal Principles Applied

The Tribunal relied on the General Rules for the Interpretation of the Import Tariff, focusing on:
1. Most Specific Description (Rule 3(a)): Goods should be classified under the heading that provides the most specific description.
2. Essential Character (Rule 3(b)): For composite goods, classification is based on the component that gives the item its essential character.
3. Technical Function and Documentation: The Tribunal examined technical literature and the intended use of the equipment to determine its essential character.
Tribunal’s Findings

The Tribunal found that:
- The Air Velocity 2700’s main function is to receive, synchronize, and route 5G signals, making it functionally a router.
- The technical evidence and documentation supported the importer’s classification under CTH 8517 6260.
- The classification declared by the importer was sustainable, and the order of the Commissioner (Appeals) was correct.
Outcome

The Tribunal dismissed the Revenue’s appeal and upheld the order in favor of M/s. Anandit Infotech India Pvt Ltd. This decision confirms that the Airspan Air Velocity 2700 is to be classified under CTH 8517 6260, entitling the importer to the associated duty benefits.

Significance

This ruling underscores the importance of technical documentation and the actual function of imported goods in customs classification disputes. It also highlights the Tribunal’s adherence to established tariff interpretation rules, ensuring that goods are classified based on their essential character and most specific description.

This case serves as a reference for importers and customs authorities dealing with advanced telecommunications equipment and similar classification issues.

Source: CESTAT Bangalore

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June 1, 2026
CESTAT Delhi Ruled Modular Kitchen Accessories Are Not Furniture Parts
Aadrikaa Legal Services (ALS) – IDT Tax I Arbitration I Litigation

Date: 30.05.2026

CESTAT Delhi Ruled Modular Kitchen Accessories Are Not Furniture Parts

This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .

The recent decision by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, in the case of M/s Inox Decor Pvt. Ltd. versus the Principal Commissioner of Customs, ICD Tughlakabad, has significant implications for importers of kitchen and household fittings. This article provides a detailed overview of the dispute, the legal arguments, and the Tribunal’s final ruling.

Background of the Dispute

M/s Inox Decor Pvt. Ltd., a company specializing in household and kitchen fittings, imported a variety of items such as Soho unit baskets, tandem boxes, bottle racks, plate racks with drip trays, carousel units, dress holders, magic corner baskets, cutlery baskets, tie racks, trouser racks, and shoe racks. These items were imported under 32 Bills of Entry and classified by the company under Customs Tariff Items (CTI) 7323 93 90, 7323 99 90, and 8302 49 00, which pertain to articles of base metal for kitchen or household use.

However, following a post-clearance audit, customs authorities alleged misclassification. They argued that these products were not standalone kitchenware but rather parts of unit furniture, and thus should be classified under CTI 9403 90 00, which covers parts of furniture. This reclassification had significant financial implications, as the duty rate for CTI 9403 increased from 10% to 20% in February 2018.

Key Legal Arguments

Appellant’s Position (Inox Decor Pvt. Ltd.)
1. Historical Precedent: The company had been importing these goods for years under the original classification without objection from customs.
2. Trade Practice: Similar products from other brands continued to be imported and sold under Chapter 73 (articles of stainless steel).
3. Distinct Identity: The items in question are baskets, hinges, and shelves with individual functions, not integral parts of furniture.
4. Specific vs. General Classification: Under the General Rules for Interpretation (GRI), a specific description (kitchenware) should take precedence over a general one (furniture parts).
5. Reference to Case Law: The appellant cited the CESTAT decision in Commissioner of Central Excise, Surat-I vs. Crystal Interior Products, where similar items were classified as kitchenware under Chapter 73.
Department’s Position
1. Nature of Goods: The items are not standalone utensils but are designed to be fixed within modular furniture, making them parts of furniture.
2. Tariff Notes and Exclusions: Chapter 94 explicitly covers furniture and its parts, including items designed to be hung or fixed to walls.
3. Inapplicability of Previous Case Law: The department argued that the Crystal Interior Products case was not relevant, as the goods in question were integral components of furniture.
Tribunal’s Analysis and Decision

The Tribunal carefully examined the tariff headings, explanatory notes, and the nature of the imported goods. Key findings included:
- Specificity Principle: The Tribunal emphasized that, per the GRI, a specific description (kitchenware under Chapter 73) should be preferred over a general one (furniture parts under Chapter 94).
- Trade and Usage: Evidence showed that similar goods were commonly classified and sold as kitchenware in the market.
- Precedent: The Tribunal found the Crystal Interior Products decision directly applicable, noting that the items were designed for use in kitchen shelves and had distinct identities as household articles.
- Tariff Notes: The Tribunal noted that Chapter 94 covers furniture and parts not otherwise specified, and that the items in question did not lose their identity as kitchenware simply because they could be fixed within furniture.
Final Outcome

The Tribunal set aside the order of the Principal Commissioner, ruling that the goods imported by Inox Decor Pvt. Ltd. should be classified under CTI 7323/8302 (kitchenware and fittings), not under CTI 9403 (furniture parts). The appeal was allowed, and the higher duty demand was quashed.

Implications for Importers
1. Classification Matters: The case underscores the importance of correct customs classification, as it directly affects duty rates and compliance.
2. Precedent Value: Importers of similar goods can rely on this decision to support classification under kitchenware headings, provided the goods have distinct household functions.
3. Documentation and Trade Practice: Maintaining records of trade usage and historical classification can be crucial in disputes.
This decision provides clarity for businesses importing modular kitchen and household fittings, ensuring that items with distinct household uses are not unfairly subjected to higher duties as furniture parts.

Source: CESTAT Delhi

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May 30, 2026
Gujarat High Court Quashes CESTAT Registry’s Rejection of ROM Application as Time-Barred
Aadrikaa Legal Services (ALS) – IDT Tax I Arbitration I Litigation

Date: 30.05.2026

Gujarat High Court Quashes CESTAT Registry’s Rejection of ROM Application as Time-Barred

This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .

This article examines a significant judgment by the Gujarat High Court in the case of Vadilal Industries Ltd. & Anr. v. Union of India & Ors. (Special Civil Application No. 19950 of 2005), which addresses the procedural nuances of rectification of mistake applications and the proper service of tribunal orders under the Central Excise Act, 1944.

Background of the Case
1. Parties Involved:
  - Petitioner: Vadilal Industries Ltd., which had taken over M/s Gujarat Cup Company, a manufacturer of paper cups for ice-cream.
  - Respondents: Union of India and related authorities.
2. Dispute Origin:
  - The dispute arose from the denial of a concessional rate of duty under Notification No. 20/94 for the period April 1994 to June 1997, resulting in a demand of Rs. 14,86,656 and a penalty of Rs. 50,000.
  - The petitioners’ appeals before the Commissioner (Appeals) and subsequently the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) were unsuccessful.
Key Events Leading to the Petition
1. Ex-Parte Decision:
  - On 16-10-2003, the CESTAT decided the appeal ex-parte after denying an adjournment request from the petitioners’ advocate.
  - The petitioners claimed they were unaware of the order as it was not served on them or their advocate.
2. Discovery and Application:
  - The petitioners learned of the order only in July 2005 and obtained a photocopy on 18-7-2005.
  - They filed a Rectification of Mistake (ROM) Application on 5-8-2005.
  - The CESTAT Registry returned the application as time-barred, stating it was filed after the six-month limitation period.
Legal Issues Examined

1. Computation of Limitation Period for ROM Applications
- Section 35C(2) of the Central Excise Act, 1944 provides a six-month period for rectification of mistakes.
- The Court clarified that this period should be computed from the date the party receives the order, not merely from the date the order is passed.
- The rationale: A party can only identify a mistake after reviewing the order, making receipt of the order the logical starting point for limitation.
2. Proper Service of Tribunal Orders
- Section 37C of the Act prescribes the modes of serving orders:
  1. Registered Post with acknowledgment due.
  2. If unserved, affixing a copy at the factory or relevant premises.
  3. If still unserved, affixing a copy on the notice board of the issuing authority.
- In this case, the order sent by registered post was returned unserved, and no further steps were taken as required by law.
- The Court held that service was incomplete, and the petitioners’ claim of non-receipt was unrebutted.
3. Authority to Decide ROM Applications
- The Technical Officer of CESTAT returned the ROM application without placing it before the Tribunal Bench.
- The Court found this action improper, stating only the Tribunal has the authority to decide on such applications.
Court’s Decision and Directions
1. Quashing of Technical Officer’s Communication:
  - The letter returning the ROM application was set aside.
2. Directions to CESTAT:
  - The petitioner was allowed to re-present the ROM application, which the Tribunal must hear on merits.
3. Costs Imposed:
  - Due to the petitioner’s delay in following up after the adjournment, costs of Rs. 10,000 were imposed, payable to the respondents.
Key Takeaways for Practitioners and Litigants
1. Limitation Period:
  - The limitation for rectification applications starts from the date of receipt of the order, not the date of the order itself.
2. Service of Orders:
  - Authorities must strictly follow the prescribed modes of service. Failure to do so can invalidate subsequent procedural steps.
3. Procedural Fairness:
  - Administrative officers must not usurp the Tribunal’s authority in deciding applications.
4. Diligence Required:
  - Litigants must proactively follow up on their cases to avoid unnecessary delays and costs.
Conclusion

This judgment reinforces the importance of procedural compliance in legal proceedings, especially regarding service of orders and computation of limitation periods. It also clarifies the respective roles of administrative officers and judicial benches in handling rectification applications, ensuring fairness and due process for all parties involved.

Connected Matter

Bombay High Court Clarifies Limitation Period for Rectification Applications under Customs Act

Source: Gujarat High Court

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May 30, 2026
CESTAT Allahabad Upholds Provisional Release of Imported Medical Gloves
Aadrikaa Legal Services (ALS) – IDT Tax I Arbitration I Litigation

Date: 30.05.2026

CESTAT Allahabad Upholds Provisional Release of Imported Medical Gloves

This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT) Allahabad recently delivered a significant order regarding the provisional release and classification of imported medical gloves by M/s Rajat International. This case highlights the complexities of customs regulations, medical device compliance, and the interplay between various regulatory authorities in India.

Background of the Case

M/s Rajat International, a proprietorship engaged in importing gloves, brought in ‘Non-sterile non-measurable powdered latex examination gloves (Class A)’ from Malaysia. The goods were detained by Customs at ICD Dadri due to concerns over port notification, product classification, and regulatory compliance. The importer sought clarification and faced multiple rounds of legal and administrative proceedings, including writ petitions before the Allahabad High Court.

Key Issues in Dispute
1. Product Classification
  - The importer classified the gloves under CTH 40151900, while Customs argued they should fall under CTH 40151200, which specifically covers medical, surgical, dental, or veterinary gloves.
  - Customs alleged misclassification was intended to avoid obtaining a No Objection Certificate (NOC) from the Assistant Drug Controller (ADC).
2. Labelling Requirements
  - Customs cited a test report indicating missing batch numbers, manufacturing dates, manufacturer’s name, and expiry dates on the samples, which are mandatory under the Medical Devices Rules (MDR), 2017.
  - The importer countered that labels were present on bulk packaging, as confirmed by a re-examination and panchnama dated 15.04.2026, which Customs failed to disclose in their appeal.
3. Import Through Non-Notified Port
  - Customs objected to the import at ICD Dadri, a non-notified port under Rule 43A of the Drugs and Cosmetics Rules, 1945.
  - The importer argued that the actual port of discharge was Nhava Sheva (a notified port), and ICD Dadri was only for clearance. This interpretation was supported by previous tribunal judgments.
Tribunal’s Analysis and Findings
- Classification Dispute: The tribunal noted that even if Customs’ classification was accepted, there was no differential duty or financial implication, as all duties had been paid. The issue was deemed academic and not relevant to the provisional release.
- Labelling Compliance: The tribunal found that labels were indeed affixed on the bulk packaging, and there was no requirement to label individual gloves. The department’s suppression of the panchnama confirming this was criticized.
- Port Notification: The tribunal agreed with the importer that the goods entered India through a notified port (Nhava Sheva), and clearance at ICD Dadri did not violate port restrictions. Previous similar imports had been cleared without issue.
- Risk to Public Health: Customs failed to provide evidence that releasing the goods would pose a health risk. The gloves were classified as Class-A (low risk) devices, and all statutory requirements were met.
- NOC Requirement: The tribunal held that once statutory requirements are fulfilled, the absence of an NOC from CDSCO cannot be a ground to withhold goods, especially when previous imports were cleared.
Final Order and Implications
- The tribunal dismissed the Customs department’s appeal, upholding the provisional release of the goods subject to bond and bank guarantee conditions.
- Customs was directed to release the goods within seven days of the order.
What This Means for Importers
1. Accurate Classification: Importers must ensure correct classification of goods but can defend their position if there is no revenue implication.
2. Labelling: Proper labelling on bulk packaging is generally sufficient for Class-A medical devices.
3. Port of Import: Goods entering through a notified port and cleared at an inland depot are compliant if supported by documentation.
Regulatory Compliance: Registration under MDR, 2017 and fulfillment of statutory requirements are crucial for smooth clearance.

Source: CESTAT Allahabad

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May 30, 2026
Delhi High Court Ruled on Retrospective Application of Limitation Period for Customs Duty Refunds
Aadrikaa Legal Services (ALS) – IDT Tax I Arbitration I Litigation

Date: 29.05.2026

Delhi High Court Ruled on Retrospective Application of Limitation Period for Customs Duty Refunds

This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .

The Delhi High Court’s decision in the case of Sony India Pvt. Ltd. v. Commissioner of Customs, New Delhi addresses a crucial question in Indian customs law: Can a limitation period for refund claims, introduced by an amending notification, be applied retrospectively to goods imported before the notification was issued? This article provides a detailed analysis of the case, its background, legal arguments, and the implications of the court’s ruling for importers and customs authorities.

Background of the Case

Sony India Pvt. Ltd., a major importer and distributor of electronic and IT products, imported goods between December 1 and December 5, 2007. At the time, Notification No. 102/2007-Cus exempted certain goods from the Special Additional Duty of Customs (SADC) under Section 3(5) of the Customs Tariff Act, 1975, provided specific conditions were met. Notably, this original notification did not specify any time limit for filing refund claims.

On August 1, 2008, Notification No. 93/2008-Cus amended the original notification, introducing a one-year limitation period for filing refund claims from the date of payment of duty. Sony India filed a refund claim on December 11, 2008, for SADC paid on its December 2007 imports. The customs authorities partially allowed the claim but rejected refunds for four Bills of Entry, citing the new one-year limitation period.

Legal Issues and Arguments

The central legal issue was whether the one-year limitation period introduced by the amending notification could be applied retrospectively to imports made before its issuance.

Appellant’s Arguments (Sony India)
- No Limitation in Original Notification: The original notification (102/2007) did not prescribe any time limit for refund claims.
- No Retrospective Application: The amending notification (93/2008) introducing the limitation period should not apply to goods imported before its issuance.
- Accrual of Right: The right to claim a refund arises only after the subsequent sale of imported goods and payment of sales tax/VAT, which is a market-driven event outside the importer’s control.
- Legal Precedents: Cited Supreme Court judgments (e.g., New India Insurance v. Shanti Misra) stating that limitation laws in force at the time of cause of action apply, and new limitation laws cannot extinguish existing rights unless expressly stated.
- Date of Payment: Argued that the date of payment should be the date when the TR-6 challan is stamped (i.e., when the government receives the funds), not the date of the demand draft.
Respondent’s Arguments (Customs Authorities)
- Application of Amending Notification: Insisted that the one-year limitation period applied to all refund claims, including those for goods imported before the notification.
- Section 27 of Customs Act: Argued that the general refund provisions and limitation periods under the Customs Act should apply.
Court’s Analysis and Findings

The High Court undertook a detailed examination of the statutory framework and the intent behind the SADC and the relevant notifications:
- Nature of SADC: The SADC is designed to counterbalance sales tax/VAT on like goods sold in India, ensuring a level playing field for domestic and imported goods.
- Accrual of Refund Right: The right to claim a refund arises only after the importer sells the goods and pays the applicable sales tax/VAT. Thus, imposing a limitation period from the date of duty payment could unfairly extinguish the right before it even accrues.
- Section 3(8) of the Customs Tariff Act: While this section incorporates refund provisions from the Customs Act, it does so only “so far as may be applicable.” The court held that the limitation period under Section 27 does not automatically apply to SADC refunds.
- Legislative Authority: The court emphasized that substantive rights, such as limitation periods affecting refund claims, must be imposed by legislation, not by subordinate notifications.
- Retrospective Application: The amending notification could not retrospectively impose a limitation period on refund claims for goods imported before its issuance.
Key Excerpts from the Judgment

“To uphold a limitation period starting from the date of payment of duty, as prescribed in the amending notification, would amount to allowing the commencement of a limitation period for refund claims before the right of refund has even accrued.”

“The imposition of a period of limitation for the first time, without statutory amendment, through a notification, therefore could not prevail.”

Outcome

The Delhi High Court ruled in favor of Sony India, holding that:
- The one-year limitation period introduced by Notification No. 93/2008-Cus cannot be applied retrospectively to goods imported before its issuance.
- The refund claims for SADC paid on such imports are not time-barred by the amending notification.
- The appeal was allowed, and the limitation period in the amending notification was read down to this extent.
Implications of the Ruling
- For Importers: Importers who paid SADC on goods imported before August 1, 2008, can claim refunds without being restricted by the one-year limitation period introduced later.
- For Customs Authorities: Limitation periods affecting substantive rights must be clearly provided by legislation, not merely by notifications or circulars.
- Legal Precedent: The judgment reinforces the principle that subordinate legislation cannot curtail substantive rights unless expressly authorized by the parent statute.
Conclusion

The Delhi High Court’s decision in the Sony India case is a significant precedent in customs law, clarifying the limits of subordinate legislation and protecting importers’ rights to claim refunds. It underscores the importance of legislative clarity and the protection of accrued rights against retrospective curtailment by administrative notifications.

Source: Delhi High Court

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May 29, 2026
CESTAT Delhi Overturns Penalty on Customs Broker Liability and Controlled Substance Exports
Aadrikaa Legal Services (ALS) – IDT Tax I Arbitration I Litigation

Date: 29.05.2026

CESTAT Delhi Overturns Penalty on Customs Broker Liability and Controlled Substance Exports

This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .

A recent decision by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Delhi, has significant implications for customs brokers and exporters dealing with controlled substances. The case, involving M/s. Unnati Cargo and the export of pharmaceutical goods containing Ergotamine, clarifies the responsibilities of customs brokers and the interpretation of controlled substance regulations under Indian law.

Background of the Case

M/s. Aprazer Healthcare Pvt. Ltd., through their authorized customs broker M/s. Unnati Cargo, attempted to export various pharmaceutical medicines to Iraq. During customs examination, two key issues were identified:
1. Presence of Ergotamine in the Consignment:
  - The medicine “MIGRAN” contained Ergotamine Titrate, a substance listed as a controlled substance under Schedule-B of the Narcotics Drugs and Psychotropic Substances (NDPS) (Regulation of Controlled Substances) Order, 2013.
  - Export of Ergotamine requires a No Objection Certificate (NOC) from the Narcotics Commissioner, which was not provided.
2. Undeclared Medicine Found:
  - An extra medicine, Ledifos (Ledipasvir 90mg & Sofosbuvir 400mg), was found in the consignment but not declared in the shipping documents.
As a result, the goods were seized, and a penalty of Rs. 50,000 was imposed on Unnati Cargo under Section 117 of the Customs Act, 1962, for failing to ensure compliance with export regulations.

Legal Arguments and Tribunal’s Analysis

Customs Broker’s Defense
- Scope of Controlled Substance:
  - The defense argued that Schedule-B of the NDPS Order covers only “Ergotamine and its salts,” not preparations containing Ergotamine. Since MIGRAN contained only 1% Ergotamine, it should be considered a preparation, not the controlled substance itself.
- Penalty Provisions:
  - The Customs Broker Licensing Regulations (CBLR), 2018, specifically provide for penalties under Regulation 18 for violations. Therefore, imposing an additional penalty under Section 117 of the Customs Act was argued to be unjustified.
- Precedent Cited:
  - The defense relied on the CESTAT decision in M/s Videojet Technologies (I) Pvt. Ltd., where it was held that NOC is required only for the controlled substance itself, not for preparations containing it.
Revenue’s Position
- The Revenue maintained that customs brokers are responsible for ensuring compliance with all statutory requirements, including verifying the need for NOC for controlled substances.
- The presence of undeclared medicines further demonstrated a lack of due diligence by the customs broker.
Tribunal’s Findings
- Interpretation of Schedule-B:
  - The Tribunal agreed that Schedule-B covers only “Ergotamine and its salts,” not preparations. Since MIGRAN was a preparation with only 1% Ergotamine, it did not fall under the controlled substance category requiring an NOC.
- Penalty Under Section 117:
  - Regulation 18 of the CBLR is a self-contained provision for penalties related to customs broker conduct. Section 117 of the Customs Act is a residuary provision and cannot be invoked when a specific penalty provision exists.
- Responsibility of Customs Broker:
  - While customs brokers are expected to be knowledgeable about customs laws, the Tribunal noted that even the authorities sought technical clarifications in this case. Expecting the broker to possess such specialized knowledge was deemed unreasonable.
Outcome

The CESTAT set aside the penalty imposed on Unnati Cargo, holding that:
- The exported product was a preparation, not a controlled substance as per Schedule-B.
- No penalty could be imposed under Section 117 of the Customs Act when Regulation 18 of the CBLR specifically covers such violations.
- The customs broker could not be held responsible for the undeclared medicine, as there was no evidence of knowledge or intent.
Key Takeaways for Exporters and Customs Brokers
- Clarity on Controlled Substances: Only substances explicitly listed in Schedule-B (and their salts) require an NOC for export, not preparations containing small percentages of such substances.
- Penalty Provisions: When specific penalty provisions exist under the CBLR, general penalty provisions under the Customs Act cannot be invoked.
- Due Diligence: Customs brokers must exercise due diligence but are not expected to have technical expertise beyond reasonable expectations, especially when authorities themselves require clarification.
Conclusion

This CESTAT Delhi ruling provides much-needed clarity on the interpretation of controlled substance regulations and the scope of customs broker responsibilities. It underscores the importance of precise legal interpretation and reasonable expectations from compliance professionals in the export sector.

Source: CESTAT Delhi

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May 29, 2026
Bombay High Court Clarifies Limitation Period for Rectification Applications under Customs Act
Aadrikaa Legal Services (ALS) – IDT Tax I Arbitration I Litigation

Date: 29.05.2026

Bombay High Court Clarifies Limitation Period for Rectification Applications under Customs Act

This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .

The Bombay High Court’s decision in the case of Allied Fibers Ltd. v. Commissioner of Customs (Custom Appeal No. 109 of 2015) is a significant legal precedent regarding the interpretation of time limits for filing applications for rectification of mistakes under Section 129B(2) of the Customs Act, 1962. This article provides a detailed analysis of the judgment, its background, the legal questions involved, and its implications for parties seeking rectification of orders from the Customs, Excise & Service Tax Appellate Tribunal (CESTAT).

Background of the Case
- Timeline of Events:
  - Between October 1994 and September 1995, Allied Fibers Ltd. imported eight consignments of capital goods.
  - A Show Cause Notice was issued in 1998, but the Commissioner of Customs dropped all proposals against the company in 1999.
  - In 2004, the Tribunal set aside the adjudication order and remanded the matter for fresh adjudication.
  - In 2006, the Commissioner confirmed the demand, confiscated goods, and imposed a penalty.
  - Allied Fibers appealed in 2014, but the Tribunal dismissed the appeal.
  - The company received the Tribunal’s order on January 9, 2015, after requesting a copy.
  - On July 6, 2015, Allied Fibers filed an application for rectification of mistakes under Section 129B.
  - The Tribunal dismissed the application as time-barred, stating it was filed beyond the six-month limit from the date of the order.
Legal Questions Considered

The High Court admitted the appeal on the following key questions of law:
1. Whether the Tribunal erred in holding that a Rectification of Mistake (ROM) application filed within six months from the date of receipt of the order was beyond the time limit prescribed by law?
2. Whether the six-month time limit in Section 129B(2) applies only when the Tribunal acts suo motu (on its own) to rectify a mistake?
Analysis of Section 129B(2) of the Customs Act

Section 129B(2) allows the Appellate Tribunal to rectify any mistake apparent from the record within six months from the date of the order. The provision distinguishes between:
- Suo Motu Rectification: The Tribunal can act on its own within six months from the date of the order.
- Application by Party: If a party seeks rectification, the Tribunal must consider the application, but the law was unclear whether the six-month period runs from the date of the order or from the date the party receives the order.
The High Court’s Reasoning
- The Court emphasized that a party cannot apply for rectification unless it has received and reviewed the order.
- It cited the Gujarat High Court’s decision in Vadilal Industries Ltd. v. Union of India, which held that the limitation period should be computed from the date of receipt of the order by the party, not the date of the order itself.
- The Court also referenced the Supreme Court’s decision in Vidyacharan Shukla v. Khubchand Baghel, which allowed exclusion of the time taken to obtain a copy of the order when calculating limitation periods.
- The Court found that a strict interpretation—requiring applications within six months from the date of the order—would render parties remediless if they did not receive the order promptly.
The Judgment and Its Implications
- The High Court set aside the Tribunal’s order dismissing Allied Fibers’ rectification application as time-barred.
- It held that applications for rectification by a party must be considered timely if filed within six months from the date of receipt of the order.
- The case was remanded to the Tribunal to decide the rectification application on its merits.
Key Takeaways for Stakeholders
- For Importers and Appellants: The judgment clarifies that the six-month limitation for filing rectification applications starts from the date of receipt of the order, not the date of the order itself. This ensures parties are not unfairly penalized for delays in receiving orders.
- For Legal Practitioners: The decision reinforces the importance of procedural fairness and the need to interpret limitation provisions in a manner that preserves the right to seek rectification.
- For the Tribunal: The CESTAT must now consider rectification applications filed within six months of the party receiving the order, ensuring access to remedies for apparent mistakes.
Conclusion

The Bombay High Court’s ruling in Allied Fibers Ltd. v. Commissioner of Customs is a landmark decision that protects the rights of appellants under the Customs Act, 1962. By clarifying the computation of limitation periods for rectification applications, the Court has ensured that procedural technicalities do not override substantive justice. Parties aggrieved by apparent mistakes in Tribunal orders should carefully document the date of receipt of orders and file rectification applications within six months of that date to safeguard their rights.

Connected Matter

Gujarat High Court Quashes CESTAT Registry’s Rejection of ROM Application as Time-Barred

Source: Bombay High Court

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May 29, 2026

CESTAT Chandigarh- Reassessment Without Proper Reasons Held Unsustainable

Aadrikaa Legal Services (ALS) – IDT Tax I Arbitration I Litigation

Date: 28.05.2026

CESTAT Chandigarh- Reassessment Without Proper Reasons Held Unsustainable

This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Chandigarh recently delivered a significant judgment in favor of Gian Castings Pvt Ltd, addressing the assessment and valuation of imported goods. This article provides a detailed overview of the case, the legal issues involved, and the implications for importers and customs authorities.

Case Background

Gian Castings Pvt Ltd, based in Mandi Gobindgarh, Punjab, imported Light Melting Scrap Bundles and Heavy Melting Scrap from Singapore. The company filed six Bills-of-Entry for clearance of these goods, self-assessed the duty, and paid accordingly. However, the customs authorities questioned the declared values, citing discrepancies with contemporaneous values from the National Import Database (NIDB).

Key Details of the Appeals

Number of Appeals: 6 (against a common order)
Bills-of-Entry and Differential Duty:

S. No.	Bill of Entry No. & Date	Differential Duty (Rs.)
1	2042960 dt. 27.07.2015	106,121
2	2069165 dt. 29.07.2015	91,016
3	2042525 dt. 27.07.2015	35,886
4	2017129 dt. 24.07.2015	170,430
5	2052442 dt. 28.07.2015	201,054
6	2043020 dt. 27.07.2015	153,365

Legal Issues and Arguments

The customs authorities enhanced the declared values based on NIDB data and recovered the differential duty. Gian Castings challenged this enhancement, arguing that:

The enhancement was not legally justified and lacked proper reasoning.
The issue had already been decided in their favor for an earlier period by the Tribunal.
Acceptance of enhanced duty under protest did not preclude their right to appeal.

The Tribunal considered whether customs authorities could enhance declared values solely based on NIDB data and contemporaneous imports, and whether procedural requirements under Customs Valuation Rules were followed.

Tribunal’s Findings

The CESTAT bench, referencing previous decisions and a landmark Delhi High Court judgment (Niraj Silk Mills & Hanuman Prasad & Sons, 2024), held:

Self-Assessment and Reassessment: Importers are required to self-assess duty, but customs officers must provide clear, reasoned grounds for doubting declared values before reassessment.
Procedural Compliance: Rule 12 of the Customs Valuation Rules mandates that reasons for doubting declared values must be recorded and communicated to the importer. Acceptance of enhanced duty under protest does not constitute a waiver of the right to appeal.
Reliance on NIDB Data: Enhancement of declared values cannot be based solely on NIDB data. There must be independent, cogent evidence or valid contemporaneous import comparisons.
Legal Precedents: The Tribunal and High Courts have consistently ruled that arbitrary reliance on external data without proper justification fails to meet statutory requirements.

Final Order and Implications

The Tribunal set aside the impugned order, allowed all six appeals, and granted consequential relief to Gian Castings Pvt Ltd. This decision reinforces:

The importance of procedural fairness in customs valuation.
The necessity for customs authorities to provide clear, objective reasons for reassessment.
The protection of importers’ rights to challenge reassessment, even after paying enhanced duty under protest.

Conclusion

The CESTAT Chandigarh’s ruling in favor of Gian Castings Pvt Ltd is a landmark for importers facing arbitrary customs valuation enhancements. It underscores the need for evidence-based assessments and adherence to statutory procedures, ensuring transparency and fairness in customs operations.

Source: CESTAT Chandigarh

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May 28, 2026

CESTAT Chennai Ruled on Customs Valuation of Imported Used Fuji Printer Processors
Aadrikaa Legal Services (ALS) – IDT Tax I Arbitration I Litigation

Date: 28.05.2026

CESTAT Chennai Ruled on Customs Valuation of Imported Used Fuji Printer Processors

This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT) in Chennai recently addressed a significant dispute involving Shri Hari Enterprises and the customs authorities. The case centered on the valuation assessment of imported used Fuji Printer Processors, raising important questions about how customs value used goods and the rights of importers to challenge such assessments.

Background of the Case

Shri Hari Enterprises imported used Fuji Printer Processors. Upon arrival, customs authorities assessed the value of these goods for the purpose of levying duties. Shri Hari Enterprises disagreed with the valuation, arguing that the assessment did not accurately reflect the true value of the used equipment. This disagreement led to an appeal before the CESTAT, seeking a review and correction of the customs valuation.

Key Issues in Customs Valuation
1. Valuation of Used Goods
  - Customs authorities often rely on standard methods to determine the value of imported goods, such as transaction value, reference to similar goods, or computed value.
  - For used goods, especially specialized equipment like printer processors, determining fair market value can be complex. Factors such as age, condition, and market demand must be considered.
2. Importer’s Right to Challenge
  - Importers have the right to contest customs assessments if they believe the valuation is incorrect or unfair.
  - The appeal process allows for a review of evidence, including invoices, market prices, and expert opinions, to ensure a fair outcome.
Tribunal’s Analysis and Decision

The CESTAT examined the following:
- Evidence Provided by Shri Hari Enterprises:
  - Invoices and purchase documents showing the price paid for the used Fuji Printer Processors.
  - Market data and expert opinions on the value of similar used equipment.
- Customs Valuation Methods:
  - The tribunal reviewed the methods used by customs authorities, assessing whether they were appropriate for used goods.
  - It considered whether customs had adequately accounted for depreciation and market realities.
- Legal Precedents:
  - The tribunal referenced previous cases where importers successfully challenged valuations, emphasizing the need for transparency and fairness.
Outcome and Implications

The CESTAT’s order provided clarity on how customs should approach the valuation of used goods:
1. Fair Assessment:
  - Customs must use reasonable and transparent methods, considering all relevant factors for used equipment.
2. Importer Protections:
  - Importers can present evidence and challenge assessments, ensuring their interests are protected.
3. Guidance for Future Cases:
  - The decision sets a precedent for similar disputes, encouraging customs authorities to adopt more nuanced approaches to valuation.
Practical Takeaways for Importers
- Document Everything: Maintain clear records of purchase prices, condition reports, and market data for imported used goods.
- Know Your Rights: Be prepared to challenge customs assessments if they seem unfair or inaccurate.
- Seek Expert Advice: Engage professionals who can provide market valuations and support your case.
Conclusion

The Shri Hari Enterprises case highlights the complexities of customs valuation for used goods and reinforces the importance of fair, evidence-based assessments. Importers should be proactive in documenting their transactions and prepared to assert their rights in the event of disputes with customs authorities.

Source: CESTAT Chennai

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May 28, 2026
CESTAT Kolkata Clarifies Customs Valuation: Franchise and Marketing Fees Excluded from Assessable Value
Aadrikaa Legal Services (ALS) – IDT Tax I Arbitration I Litigation

Date: 28.05.2026

CESTAT Kolkata Clarifies Customs Valuation: Franchise and Marketing Fees Excluded from Assessable Value

This Short Article has been prepared & written by Advocate Ravi Shekhar Jha-Delhi High Court, New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com .

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT) Kolkata recently adjudicated a significant dispute involving M/s Sterling Meta-Plast India Pvt. Ltd. and the Principal Commissioner of Customs, Kolkata. The core issue was whether franchise fees, advertisement and marketing expenses, and corporate marketing fees paid by Sterling Meta-Plast for licensing brands (Tommy Hilfiger and French Connection) should be included in the assessable value of imported goods under Indian customs law.

Background of the Case

Sterling Meta-Plast imports fashion eyewear and accessories under various brands, including licensing brands Tommy Hilfiger (TH) and French Connection (FC). The company pays:
- Franchise Fees (minimum and percentage-based) to licensors.
- Advertisement, Marketing, and Promotion (AMP) Expenses in India.
- Corporate Marketing Fee (CMF) as a share in global marketing costs.
Goods are imported from unrelated Hong Kong suppliers, and the prices are negotiated independently. The customs department questioned whether these additional payments should be included in the customs value of the imported goods.

Legal Framework

The dispute centers on Section 14(1) of the Customs Act, 1962 and Rules 3(1), 10(1)(c), and 10(1)(e) of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007:
- Rule 10(1)(c): Royalties and license fees related to imported goods, paid as a condition of sale, must be included in the assessable value.
- Rule 10(1)(e): All other payments made as a condition of sale to the seller or a third party to satisfy the seller’s obligation must be included, unless already in the price paid.
Key Issues and Tribunal Findings

1. Inclusion of Franchise Fees
- The Tribunal found that franchise fees paid to licensors were for the right to sell, distribute, and promote goods in India, not for the procurement of goods from overseas suppliers.
- There was no condition in the sale contract with Hong Kong suppliers requiring payment of franchise fees.
- Citing precedents (Luxottica India Eyewear, Quest Retail, Ferodo India), the Tribunal held that unless the payment is a condition of sale imposed by the supplier, it is not includible in the customs value.
- Advisory opinions and GATT Customs Valuation Code also support this interpretation.
2. Inclusion of AMP Expenses and Corporate Marketing Fees
- AMP expenses and CMF were incurred by Sterling Meta-Plast on its own account for business promotion, not as a condition of sale from the supplier.
- The Tribunal referenced several cases (Triumph Motorcycles, Adidas India, Volvo Auto India) and GATT commentary, confirming that such expenses are not includible unless the seller has an enforceable legal right to compel the buyer to incur them.
- The expenses benefit both buyer and seller but are not indirect payments to the seller.
3. Extended Period of Limitation
- The Tribunal ruled that the extended period for raising customs demands was not applicable, as the customs authorities were already aware of the franchise agreements and provisional assessments had been finalized.
4. Redemption Fine and Penalty
- Since the goods had already been cleared and were not available for confiscation, no redemption fine could be imposed.
- Penalties and interest were also not sustainable as the demand was based on interpretational issues, not malafide intent.
Implications for Importers
1. Franchise Fees: Payments for post-import rights (distribution, marketing) are not includible in customs value unless they are a condition of sale imposed by the supplier.
2. AMP and CMF: Expenses incurred for business promotion by the importer, not mandated by the supplier, are excluded from customs value.
3. Documentation: Importers should maintain clear agreements and evidence of independent negotiations with suppliers to avoid disputes.
4. Legal Precedents: The Tribunal’s reliance on prior judgments and international customs valuation standards strengthens the position of importers in similar cases.
Conclusion

The CESTAT Kolkata’s order in the Sterling Meta-Plast case clarifies that franchise fees, AMP expenses, and corporate marketing fees paid for licensing brands are not includible in the assessable value of imported goods unless they are a condition of sale imposed by the supplier. This decision provides important guidance for importers dealing with brand licensing and marketing arrangements under Indian customs law.

Source: CESTAT Kolkata

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May 28, 2026

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