2026-VIL-878-CESTAT-HYD-CU
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CUSTOMS CESTAT Cases

Customs - Appellant is Director of a foreign company incorporated outside India was alleged to have issued dual invoices reflecting actual transaction value and suppressed values for Customs purposes, with differential amounts being remitted through unofficial channels - Appellant contended that as a Director of a foreign entity, no proceedings could be initiated against him without making the company itself a noticee, and that the Customs Act had no extraterritorial jurisdiction prior to amendment in 2018 - Whether a Director of a foreign company can be held liable for Customs offences relating to undervaluation of imported goods – HELD - The Customs Act is fully applicable to a person who consciously and deliberately participates in fraudulent importation into India, irrespective of whether the principal company is incorporated outside India or whether the Customs Act had explicit extraterritorial provisions at the material time. The taxable event under Customs law is importation into India, and once manipulated invoices are knowingly prepared and utilized for Customs clearance within Indian territory, the offence attains territorial nexus with India and stands completed within Indian territory. A person situated outside India cannot claim immunity merely because the conspiracy originated outside India - The doctrine that where a person knowingly engages in acts contravening statutory provisions and such acts have operative effect within India, he remains personally answerable under law irrespective of nationality or place of incorporation of his associated entity, applies to the present circumstances – The Section 112(a) of the Customs Act uses the expression "any person" which is intentionally broad and encompasses every person who knowingly participates in fraudulent importation or undervaluation irrespective of designation or geographical location - The penalties imposed under Section 112(a) and Section 114AA of the Customs Act, 1962 are sustained and the appeal is dismissed
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