Halton India Private Limited Vs Customs Authority (Karnataka High Court)
Summary: The appellant/assessee, Halton India Private Limited, approached the Karnataka High Court under Section 28-KA of the Customs Act, 1962, challenging order bearing No. CAAR/Mum/ARC/167/2025-26 dated 25.03.2026 passed by the Customs Authority for Advance Rulings.
The appellant is engaged in ventilation solutions and allied industries and imports kitchen exhaust hoods from its manufacturing unit in Malaysia for use by clients in India. According to the appellant, the exhaust hoods are exclusively intended for commercial kitchens and establishments for capturing, containing and removing heat, smoke, grease, steam and odours from the installed premises.
The appellant had been importing and classifying the goods under Customs Tariff Heading (CTH) 84148090 – “Other”, stated to relate to the residuary entry of Chapter 8414. It proposed to classify future imports under CTH 84145990 – “Others”, contending that the imported kitchen exhaust goods would fall within the relevant tariff entry covering, inter alia, fans and ventilating or recycling hoods incorporating a fan. For this purpose, the appellant filed an application before the Customs Authority for Advance Rulings. The Customs Authority for Advance Rulings framework is governed by the Customs Act and the Customs Authority for Advance Rulings Regulations, 2021.
The appellant submitted before the High Court that it had e-mailed additional documents and information supporting its classification claim, but the material was inadvertently sent to an incorrect e-mail address. According to the appellant, this was a bona fide error and consequently the Advance Ruling Authority did not have the additional material before it while passing the impugned order. The appellant specifically relied on the observation in paragraph 8.3 of the impugned order that no additional submissions had been received. It therefore sought an opportunity to furnish the material and establish that the imported kitchen exhaust hoods contain fans.
The Revenue opposed the appeal. Its counsel submitted that, on the material available before the Advance Ruling Authority, the Authority had reached a definite finding that the product did not contain a fan and that the impugned order therefore did not warrant interference.
The Karnataka High Court considered the rival submissions and the material on record. The Court found that the Advance Ruling Authority was required to arrive at a factual finding, after examining the material, as to whether the kitchen exhaust hoods contain fans. The Court noted the conflicting positions: the appellant contended that the exhaust kitchen hoods contain fans, whereas the Authority had concluded that they did not contain any fan.
In these circumstances, the High Court considered it appropriate, in the interest of justice, to provide the appellant an opportunity to furnish the additional material supporting its contention. The Court permitted the appellant to forward the material by e-mail to the proper address for establishing that the imported kitchen exhaust hoods contain fans.
The Court accordingly set aside the impugned order bearing No. CAAR/Mum/ARC/167/2025-26 dated 25.03.2026 and remitted the matter to the Customs Authority for Advance Rulings. The appellant was granted 15 days from the date of the order to forward or furnish additional material or submissions to the Authority.
The Advance Ruling Authority was directed to examine the additional material or submissions furnished by the appellant and thereafter pass an appropriate order in accordance with law. Thus, the High Court did not finally determine the classification of the kitchen exhaust hoods or hold that the appellant’s proposed classification under CTH 84145990 was correct. The matter was restored to the Advance Ruling Authority for fresh consideration after taking the additional material into account.
With these directions, the appeal was disposed of.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
The appellant/assessee is before this Court under Section 28-KA of the Customs Act, 1962 questioning impugned order bearing No. CAAR/Mum/ARC/167/2025-26 dated 25.03.2026 (Annexure-A) passed by the Customs Authority for Advance Rulings.
2. Heard learned counsel Sri. Pradyumna. G.H., for appellant and learned counsel Sri. Arvind V. Chavan for respondents/Revenue. Perused the entire appeal papers.
3. It is stated that the appellant is engaged in the field of ventilation solutions and allied industries. It is also stated that the appellant routinely imports kitchen exhaust hoods from its manufacturing unit in Malaysia to cater to its clients in India. It is stated that the exhaust hoods are exclusively intended for use in commercial kitchens and establishments for the capture, containment and removal of heat, smoke, grease, steam and odours from the installed premises. It is stated that the appellant was importing and classifying the same under the Customs Tariff Heading (CTH) “84148090 – Other” which related to residuary entries of Chapter 8414 – Gas Compressor, Turbine and Air Conditioner. Learned counsel for the appellant submits that as the kitchen exhaust goods imported by the appellant would not fall under the Category of either Gas Compressors, Turbine and Air Conditioner, the appellant intended to re-classify all its future imports under the CTH 8414 – Air or Vaccum Pumps, Air or other Gas Compressors and Fans; Ventilating or Recycling Hoods Incorporating a Fan, whether or not fitted with Filters, particularly, under 84145990 – Others. For the above said purpose, it is stated that the appellant filed Application before the Customs Authority for Advance Rulings – first respondent herein.
4. It is the case of the appellant that the appellant had e-mailed certain additional documents and information in support of its claim, however, to an incorrect email, which according to the learned counsel for the appellant, was a bonafide error. It is submitted that the respondent – Advance Ruling Authority had no opportunity of going through those materials while passing the impugned order. Learned counsel would point out that in the impugned order at paragraph 8.3, the respondent – Advance Ruling Authority has observed that, no additional submissions had been received from the appellant. He submits that on verification, the authorized representative of the appellant found that the additional submissions or material were sent to a wrong e-mail ID. Thus, learned counsel would submit that one more opportunity needs to be provided to the appellant to establish its case and to convince the respondent that kitchen exhaust goods contain fans.
5. On the other hand, learned counsel Sri. Arvind V. Chavan for respondents/Revenue would submit that on the material placed on record by the appellant, the respondent – Advance Ruling Authority has come to a definite finding that the product would not contain fan. Therefore, he submits that the respondent – Advance Ruling Authority based on the material on record has rightly passed the order which needs no interference.
6. On hearing the learned counsel appearing for the parties and on perusal of the entire material on record, we are of the considered opinion that the respondent Advance Ruling Authority has to give a factual finding by examining the material as to whether the kitchen exhaust hoods contain fan or not. It is the contention of the appellant that the exhaust kitchen hoods contain fan, whereas, the respondent-Authority has come to a definite conclusion that it would not contain any fan.
7. In the above circumstances, in the interest of justice, to provide an opportunity to the appellant/assessee to prove that the kitchen exhaust hoods imported by the appellant would contain fans, the appellant/assessee is permitted to forward through e-mail to the proper address, the material on which it places reliance to establish that the kitchen exhaust hoods imported by the appellant would contain fan. The respondent authority shall examine the additional material or submission that would be submitted by the appellant/assessee and on examining the same, pass appropriate order. In the above circumstances, the following:
ORDER
a) Impugned order passed by the respondent – Advance Ruling Authority bearing No. CAAR/Mum/ARC/167/2025-26 dated 25.03.2026 (Annexure-A) stands set aside and the matter is remitted back to the respondent – Advance Ruling Authority.
b) The appellant herein is granted 15 days time from today to forward or to furnish additional material or submission to the respondent – Authority.
c) On submission of the additional information or submission as directed above, the respondent – Authority shall take into consideration the additional information or submission made available by the appellant and pass appropriate order in accordance with law.
d) With the above, appeal stands disposed of.
