ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 27.09.2025
CESTAT Delhi- Mushroom Cultivation Equipment Classified as Agricultural Machinery
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 ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, recently addressed a dispute concerning the classification of imported goods used in mushroom cultivation. The case revolved around whether the imported aluminium shelving, floor drain, and automatic watering system for mushroom growing should be classified under a tariff heading for agricultural machinery or as generic aluminium structures. This decision has far-reaching implications for agricultural businesses and importers of specialized equipment.
The Case Overview
The appellant, M/s. Welkin Foods, imported aluminium shelving, floor drains, and automatic watering systems specifically designed for mushroom cultivation. They classified these goods under Customs Tariff Heading (CTH) 84369900, which pertains to agricultural machinery, claiming a ‘nil rate of duty.’ However, the Customs Department argued that the shelving should be classified under CTH 76109010, which covers generic aluminium structures and attracts higher duties.
The department alleged misclassification, resulting in a shortfall of Rs. 21,01,983 in duty payments. The appellant contested this claim, leading to a legal battle that culminated in the Tribunal’s decision.
Source: CESTAT Delhi
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