Customs Act 1962
14 articles
Missing Battery, Complete Vehicle: CESTAT Principal Bench Classifies a CKD Electric Motorcycle Kit as a Whole Vehicle but Denies the Concessional Kit Exemption
An importer of electric two-wheeler kits argued that a notice issued by an Assistant Commissioner was void, that self-assessed Bills of Entry were final, and that kits missing batteries and chargers still earned the concessional rate. The Tribunal rejected each point: classification follows essential character, but the exemption demands every necessary component.
14 min readA Letter of Acceptance Does Not Waive the Right to Challenge Enhanced Customs Value: CESTAT Allahabad in Siddhi Vinayak Importers
Importers pressed to sign letters accepting a higher assessable value are often told they have given up the right to complain. A CESTAT Allahabad final order, following the Delhi High Court's Niraj Silk Mills decision and the Supreme Court's Century Metal Recycling, says otherwise: consent narrows only the speaking order, and a valuation enhancement must still rest on disclosed, comparable evidence.
13 min readInterest Runs From Determination, Not From the Original Assessment: Delhi High Court on Customs Interest After Redemption of Confiscated Goods
After seven years of pending adjudication, the Customs EDI System showed interest running from May 2015. A Division Bench of the Delhi High Court holds that interest cannot be computed for a period during which the liability had itself not been determined, and directs recomputation from 28 February 2023.
13 min readStatement First, Cross-Examination Second: CESTAT Allahabad Invokes Section 9D of the Central Excise Act to Quash a ₹2.39 Crore Cenvat Credit Fraud Demand Against Rathi Steel and Power
A Ghaziabad steel manufacturer was one of 68 noticees accused of availing Cenvat credit on cenvatable invoices issued without any actual supply of copper scrap. The Customs, Excise & Service Tax Appellate Tribunal set aside the ₹2.39 crore demand confirmed against it, holding that the adjudicating authority relied on third-party statements without following Section 9D of the Central Excise Act's mandatory procedure for admitting them in evidence, treated a co-noticee's settlement under an amnesty scheme as proof against unrelated parties, and confirmed the demand through generic findings that never engaged the appellant's own case.
14 min readVoluntary Deposit, Not a Time-Barred Demand: Delhi High Court Upholds a Customs Settlement Commission's Appropriation of Duty Beyond the Section 28 Limitation Period
An importer of confectionery items voluntarily deposited over ₹85 lakh during a DRI investigation into under-invoicing, and its proprietor admitted the full differential duty liability and asked that the deposit be adjusted against it. When the Settlement Commission later appropriated part of that deposit towards duty for a period beyond the Customs Act's five-year extended limitation period, the importer cried foul. The Delhi High Court dismissed the challenge, holding that Section 28 bars the Revenue's power to raise a fresh demand after the limitation period, but does not bar the appropriation of an amount the importer had already, voluntarily and without qualification, admitted was owed and asked to have adjusted.
12 min readVoidable, Not Void: Calcutta High Court Shields an Innocent DFIA Licence Transferee from a Decade-Old Customs Demand
Comet Overseas bought a genuine, validly transferable duty-free import licence for value, through proper banking channels, years before the original licence-holder's export obligation was found to rest on falsely declared goods. The Calcutta High Court held the licence remained voidable, not void, and that an unimpeached bona fide transferee cannot be made to answer in customs duty, interest and redemption fine for a fraud committed further up the chain.
13 min readFreeze Before Order, Hearing Before Extension: Patna High Court Reads GST Attachment Jurisprudence Into Section 110(5) of the Customs Act
A division bench of the Patna High Court quashed provisional attachments of a digital-marketing company's bank accounts where the department could not show a written, Commissioner-approved order preceding the freeze, and set aside extension orders passed without any hearing before the six-month period expired. Treating Section 110(5) of the Customs Act and Section 83 of the GST Act as in pari materia, the Court imported the Supreme Court's Radha Krishan Industries construction of the GST provision wholesale into the customs context, while also rebuking the department for attempting to cure the defect through a fresh order passed while the writ petition was pending.
14 min readNo Duty, No Section 28 Jurisdiction: CESTAT Chennai's Toyota Kirloskar Ruling on Sensor Classification and the Limits of Customs Reassessment
A CESTAT Chennai final order on customs classification of automotive sensors doubles as a ruling on the outer limits of Section 28 of the Customs Act — holding that a completed, nil-duty self-assessment cannot be reopened under Section 28 at all, and that no interest attaches to differential IGST for periods before the Customs Tariff Act's borrowing provision was amended to include interest.
13 min readWhose Delay Is It? Delhi High Court Holds a ₹20 Crore Customs Demand Timely Because the Assessee's Own Writ Stay Suspended the Section 28(9) Clock
GKEM International argued that a ₹20.18 crore customs demand was time-barred because its show cause notice sat in the department's 'Call Book' for years. The Delhi High Court disagreed: the delay was occasioned by the assessee's own writ petition and interim stay, which is exactly the circumstance Section 28(9A) excludes from the limitation clock — and the Call Book entry was merely the administrative record of that fact, not its source.
14 min readA Claim Never Filed Is a Claim Extinguished: Delhi High Court Quashes a Customs Duty Demand the Department Never Placed Before the Resolution Professional
The goods were imported in 2023, the insolvency process ran its course in 2024 and 2025, and the customs show-cause notice arrived only after the resolution plan had already been approved. The Delhi High Court held that a customs demand for duty, interest and penalty on a pre-CIRP import cannot outlive a resolution plan the department never bothered to file a claim in — however live the underlying adjudication otherwise remained.
14 min readDelay Is Not Default: Supreme Court Holds a Carrier Who Deposits Foreign Travel Tax Late Cannot Be Penalised as One Who Failed to Pay It
An airline deposited Foreign Travel Tax late in six instances, once by 63 days, and was hit with a penalty of over Rs. 71 lakh — nearly 600 times the amount first imposed before its own appeal triggered a remand. The Supreme Court set the penalty aside, holding that 'failure to pay' cannot be equated with delay, and that customs officers retain discretion not to impose a penalty even where a statutory minimum is prescribed.
14 min readDetention Is Not Seizure: Gujarat High Court Says Customs Cannot Sidestep the Section 110(2) Limitation Clock by Simply Not Passing an Order
A Toyota Land Cruiser sat in DRI custody for over a year on the strength of nothing more than a panchnama, while the department waited out the writ petition before finally issuing a seizure order — and then a show-cause notice timed to fall just inside the limitation period it measured from that late order. The Gujarat High Court was not persuaded: detention without a recorded order under Section 110 is not seizure, the limitation clock does not wait on the department's convenience, and the DRI's account of why it had not acted sooner did not survive the Court's own record.
13 min readA Non Obstante Clause That Bites: Supreme Court Upholds Customs Duty on Pilfered Goods Against a Statutory Port Trust
A port trust argued that its custody of imported cargo came from its own constituting statute, so the customs authorities had no power to notify it as a duty-bearing custodian. The Supreme Court draws a careful line between a saving clause and a non obstante clause to reject that argument — while denying the department any actual recovery in the case before it.
13 min readFresh Contract, Fresh Import: Delhi High Court Denies Customs Re-Import Exemption on Petroleum Equipment Routed Through an FTWZ
Baker Hughes, BJ Services and Halliburton argued that parking exploration equipment in an FTWZ between contracts let them re-enter it duty-free as a re-import. The Delhi High Court disagreed: without continuity between the export and the return, there is no re-import at all.
14 min read