Lulu International Shopping Malls Pvt Ltd Vs Commissioner of Customs (CESTAT Bangalore)
The case concerned a customs classification and preferential duty dispute over trampolines and tag arenas imported by Lulu International Shopping Malls Pvt Ltd from the Subic Bay Free Port, Philippines, an ASEAN country. The appellant imported these items for amusement facilities in malls, declaring them under tariff item 9506 9190 (“Articles and equipment for general physical gymnastics or athletics”) and claimed ASEAN preferential duty. Customs contested the classification, asserting the goods fell under 9506 9990 (“Other”), demanding ₹93.24 lakh differential duty, confiscating goods worth ₹4.34 crore, and imposing penalties on the company and an employee.
The primary issues were:
-
Classification under Customs Tariff: Whether trampolines and tag arenas qualify under 9506 9190 for preferential duty. Customs relied on HS codes, email correspondences, and discrepancies in certificates of origin and packing lists to deny preferential duty.
-
Valuation of Imported Goods: Customs sought to include installation and commissioning charges (€475,132.81) in assessable value under rule 10 of Customs Valuation Rules, arguing services formed a “condition of sale.” The appellant contended these were optional services rendered in India, already subject to domestic GST, and not part of the import value.
-
Interpretation of Tariff Rules: The case extensively considered the General Rules for Interpretation of Tariff (rules 1–6) to determine proper classification. Customs allegedly misapplied these rules by rejecting the claimed tariff before determining a correct classification.
-
Legal Precedents: The court referred to Supreme Court rulings, including State of Madhya Pradesh v. Kedia Leather & Liquors, JK Corporation Ltd, and Goodyear India Ltd, to affirm that:
Paid content
Become a Basic or Premium Member, or log in if you are already a Basic or Premium member.
