K. A. Enterprises Vs Commissioner of Customs (CESTAT Delhi)
In this case before the Customs Excise and Service Tax Appellate Tribunal Delhi, the appellant challenged an order confirming customs duty demand of ₹31,40,636 along with interest and an equivalent penalty under the Customs Act, 1962. The dispute arose from imports made between October 2018 and June 2021, where the appellant imported raw materials used in manufacturing sanitary napkins and claimed concessional duty under Notification No. 50/2017-Cus by following the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 (IGCR Rules).
The department alleged that the appellant violated Rules 5 and 6 of the IGCR Rules by declaring a lower quantity of imported goods compared to the actual imports. Based on this, a show cause notice was issued proposing recovery of differential duty with interest and penalty, invoking the extended limitation period under Section 28(4). The demand was confirmed by the adjudicating authority and upheld by the Commissioner (Appeals).
The appellant contended that it had complied with all procedural requirements under the IGCR Rules, including filing declarations and providing necessary information to jurisdictional authorities. It argued that declaring estimated quantities under Rule 5 does not require exact quantities and that any procedural lapse cannot deny substantive exemption benefits. The appellant also argued that the demand was time-barred and that Section 28(4) was not applicable.
