2026-VIL-428-ORI-CU
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CUSTOMS High Court Cases

Customs - Determination of Fe content for customs duty assessment of exported iron ore fines - Demand-cum-show-cause notice alleging misdeclaration of iron ore fines (Fe content) and consequent evasion of Customs duty - Order-in-original assessing the Fe content of the exported iron ore fines on dry metric tonne (DMT) basis, instead of the wet metric tonne (WMT) basis - Whether the Commissioner of Customs (Preventive) was justified in assessing the Fe content of the exported iron ore fines on DMT basis, instead of the WMT basis as per the CBIC circular, for the transactions that occurred prior to the amendment of the Customs Tariff Act, 1975 by the Finance Act, 2022 - HELD - The transactions of export in question were prior to the amendment of the Customs Tariff Act, 1975 by the Finance Act, 2022 which changed the method of computation from WMT to DMT. Since the transactions of export relate to the period prior to the enforcement of the amendment in the Customs Tariff Act, 1975 by the Finance Act, 2022, the method of calculation would be governed by the extant statutory provisions, rules, and circulars on the date of the taxable event. It is settled legal position that the Fe content of the exported iron ore fines is to be determined on the WMT basis as per the CBIC Circular No. 04/2012-Customs dated 17.02.2012 - The Commissioner of Customs has proceeded to adjudicate the Fe content to be more than 58% on the basis of DMT, which is erroneous approach and such finding rendered in the Order-in-Original is perverse and inconsistent and conflicts with the settled position of law in this regard - The order-in-original passed by the Commissioner of Customs (Preventive) is inconsistent with the settled legal position and thus set aside. The matter is remitted back to the Commissioner to adjudicate the liability or otherwise by classifying the iron ore fines on the basis of WMT, after affording a reasonable opportunity of hearing to the petitioner and confronting the material collected - The order-in-original is set aside and the writ petition is allowed
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