2026-VIL-1294-CESTAT-KOL-CU
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CUSTOMS CESTAT Cases

Customs - Denial of ASEAN-India Free Trade Area exemption benefit – Appellant imported Cold Rolled Stainless Steel Coil from Malaysia with Certificates of Origin issued by competent Malaysian authorities and claimed exemption benefit under Sl. No. 967(I) of Notification No. 46/2011-Customs pursuant to ASEAN-India Free Trade Area preferential tariff agreement – DRI investigation found that overseas supplier M/s. Bahru Stainless SDN. BHD. refused to furnish documents during on-site verification citing confidentiality obligations and shareholder duties – Department formed view that non-cooperation constituted non-compliance with origin verification mechanism and Board recommended denial of preferential treatment for all Certificates of Origin issued by said supplier – Whether preferential tariff benefit can be denied on basis of alleged non-cooperation of overseas supplier during verification exercise without individual examination of each Certificate of Origin and whether extended period of limitation under Section 28(4) can be invoked – HELD – The Non-cooperation by overseas supplier during verification cannot automatically translate into wholesale invalidation of every Certificate of Origin previously issued – Legislative scheme does not contemplate that isolated act of non-cooperation by overseas supplier would ipso facto extinguish legal efficacy of every Certificate of Origin irrespective of individual transaction or importer concerned. Every Certificate of Origin represents independent statutory document issued in relation to distinct import transaction and carries separate legal presumption until lawfully displaced in accordance with prescribed procedure. The validity of one Certificate cannot be mechanically determined on basis of generalized administrative recommendation issued in respect of exporter – Certificates of Origin were accepted by proper officer at time of assessment without any finding that they were forged, fabricated, cancelled or declared invalid by competent issuing authority. The subsequent departmental communications are merely administrative correspondence and cannot substitute statutory procedure contemplated under Rules of Origin nor nullify Certificates issued by competent designated authority of sovereign contracting party – Denial of substantive fiscal benefit cannot rest on speculative foundations or generalized administrative presumptions. Imports previously effected cannot retrospectively deprive importer of benefit which had accrued on basis of documents accepted by proper officer – Further, the extended period of limitation cannot be invoked as Revenue failed to establish by cogent evidence existence of fraud, collusion, wilful misstatement or suppression with intent to evade duty – Impugned order set aside and appellant entitled to preferential rate under AIFTA. The appeal is allowed
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