Case Law Details
Anuj jain Vs Principal Commissioner of Customs (Import) (Delhi High Court)
Delhi High Court delivered an order in the matter of Anuj Jain vs Principal Commissioner of Customs (Import), addressing the petitioner’s challenge to an Order-in-Original dated 24 April 2020 issued by the Principal Commissioner of Customs (Import), Tughlakabad, New Delhi. The case arose from the import of two consignments in containers numbered TGHU 9546915 and OOLU 8433339.
During inspection, the first container was found to contain cigarettes, although it had been declared as carrying induction cookers. Despite this discrepancy, the container was cleared through customs. The second container, which had initially been cleared, was later found at a warehouse and confiscated during a town seizure. The Customs authorities subsequently demanded duty from the petitioner.
The Directorate of Revenue Intelligence (DRI) recorded statements from multiple individuals, including Anuj Jain, which revealed that he had introduced the proprietor of M/s Nikhaar Associates, the importer, to a Customs handling agent and handed over documents relating to the consignments. The petitioner was also one of the addressees of the Show Cause Notice (SCN) dated 16 August 2013.
In response, the petitioner filed a reply to the SCN. The Office of the Principal Commissioner of Customs passed the Order-in-Original on 24 April 2020, which required pre-deposit of duties, interest, and penalties for filing an appeal before the Central Excise and Service Tax Appellate Tribunal (CESTAT). The order specified that cases with amounts up to Rs. 5,00,000 required a Rs. 1,000 pre-deposit, while cases between Rs. 5,00,000 and Rs. 50,00,000 required Rs. 5,000.
The petitioner challenged the order before CESTAT, which rejected the appeal due to non-payment of the requisite pre-deposit. Counsel for the petitioner submitted that while the penalty portion had been pre-deposited (7.5%), the duty demanded on the second container—Rs. 1,98,68,395.5—was substantial and could not be deposited in full. She argued that both containers should be treated similarly and requested permission to pursue the appeal without full pre-deposit.
The counsel for the respondent argued that the first container was confiscated at the port, whereas the second container had been cleared and later seized at a warehouse. Therefore, differential treatment was warranted, and the duty demand was valid.
The key issue before the High Court was whether the duty demand on the second container was valid and whether the appeal could proceed despite partial pre-deposit. The Court observed that the validity of the duty demand was a matter to be adjudicated by CESTAT on merits, but the appeal had not been heard due to lack of pre-deposit.
Considering the facts, including the partial pre-deposit already made, the Delhi High Court allowed the petitioner to deposit 50% of the required pre-deposit amounting to Rs. 7,45,646 in addition to the amount already paid. The Court directed that upon such deposit, CESTAT should hear the appeal on merits. The case was listed before CESTAT on 6 October 2025.
The High Court clarified that all rights and contentions of the parties remained open, and the petition was disposed of accordingly. Pending applications, if any, were also disposed of.
The judgment aligns with established principles allowing appeals to proceed on merits even when full pre-deposit cannot be made, provided a reasonable portion is deposited, as seen in precedents such as Commissioner of Customs vs Sushil Agro Foods Pvt. Ltd. (2017), where the Court emphasized balancing duty enforcement with procedural fairness in allowing appeals before CESTAT.
In summary, the Delhi High Court’s order enables the petitioner to pursue the customs appeal regarding the second container, ensures the appeal is heard on merits, and allows for a partial pre-deposit to facilitate access to CESTAT, leaving the substantive determination of duty liability to the appellate forum.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. This hearing has been done through hybrid mode.
2. The present petition has been filed by the Petitioner challenging the Order-in-Original dated 24th April, 2020 (hereinafter, ‘the impugned order’) passed by the Office of the Principal Commissioner of Customs (Import), Tughlakabad, New Delhi.
3. The background of the case giving rise to the present petition is that there were two consignments which were imported in containers bearing no. TGHU 9546915 and OOLU 8433339. The first container was confiscated by the Customs Officials and it was revealed during inspection that there were cigarettes which were imported in the said container, but the declaration of the goods pertained to induction cookers.
4. The said container also was declared as induction cookers and was cleared through customs. The second container was cleared by the Customs officials and was subsequently located at a particular godown premises. Upon a town seizure being made, the goods were absolutely confiscated and a demand of customs duty was raised on the Petitioner.
5. In respect of both these containers, statements of several persons, including that of the Petitioner, were recorded by the Directorate of Revenue Intelligence (hereinafter, ‘DRI’). As per the statement of the Petitioner, it was revealed that the Petitioner had introduced the proprietor of M/s Nikhaar Associates, the importer, to the Customs handling agent and the documents relating to the said consignments were also handed over. The Petitioner was also one of the notices in the Show Cause Notice dated 16th August, 2013 (hereinafter, ‘SCN’).
6. The Petitioner then filed a reply to the said SCN and then the Order-in-Original was passed on 24th April, 2020. In so far as it is relevant to the Petitioner, the extract of the order reads as under:-
“A. Rs. 1000/- draft where the case against which the appeal relates and the amount of duty, interest demanded, and penalty levied is less than or equal to Rs. 5,00,000/-. B. Rs. 5000/- draft where the case against which the appeal relates and the amount of duty, interest demanded, and penalty levied between to Rs. 5,00,000/- to Rs. 50,00,000/.”
7. This order was sought to be challenged before Central Excise and Service Tax Appellate Tribunal (hereinafter, CESTAT) which had rejected the appeal on the ground that the requisite pre-deposit was not made.
8. Ms. Shikha Sapra, ld. Counsel appearing for the Petitioner submits that in so far as the penalty imposed on the Petitioner vide the impugned order is concerned, the requisite 7.5% has been deposited. However, the duty demanded for one of the containers is substantial and the Petitioner is unable to deposit the said pre deposit. She thus raises a plea that in respect of the consignment which were seized at the port, the duty demand has been dropped, but in respect of which the consignment which was confiscated from the godown, a substantial duty demand of Rs 1,98,68,395.5/- has been raised.
9. Counsel for the Petitioner, therefore, prays that the Petitioner be permitted to pursue the appeal before the CESTAT by not making any pre deposit qua the duty as the two containers are placed at the same pedestal and differential treatment cannot be accorded to them.
10. Ms. Anushree Narain, ld. SSC on the other hand submits that in one of the containers, the goods were confiscated at the port itself. The second container had been cleared through customs and the seizure was a town seizure when the goods had themselves been cleared from the port. Thus, it cannot be said that the duty cannot be imposed on the said seizure.
11. The question that thus arises for consideration in this case is whether the duty demand in respect of the second container is valid or not . In the opinion of this Court, the said issue would have to be adjudicated by CESTAT on merits. However, due to the lack of pre-deposit, the appeal has not been heard.
12. As already recorded above, the Petitioner has already deposited a sum of Rs. 2,64,395/- towards pre deposit qua the penalties imposed on Mr. Anuj Jain. In respect of the first container, no duty has been demanded and in respect of the second container, full duty has been demanded. 7.5% of the value of the consignment of the duty demanded of Rs 19,86,8395.5/- would amount to Rs 14,90,129/-.
13. This Court, considering the overall facts, is of the opinion that the appeal of the Petitioner deserves to be heard on merits, especially, as some pre- deposits have already been made.
14. Under these circumstances, the Petitioner is permitted to deposit 50% of the pre deposit i.e. 50% of Rs 14,90,129/- is Rs 7,45,646/-, in addition to the pre deposit already made. Let the said deposit be made within six weeks. Upon such deposit being made by the Petitioner, the CESTAT shall hear the appeal of the Petitioner on merits.
15. List before the CESTAT on 06th October, 2025.
16. All the rights and contentions of the parties are left open. The present petition is disposed of in said terms. Pending applications, if any, are also disposed of.
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