#Duty Exemption

CESTAT rules that supplies to SEZ units under Section 26(1)(e) of the SEZ Act are exempt from customs duty, and any penalty imposed without proper notice or evidence violates principles of natural justice. The tribunal set aside a ₹72 lakh demand, reinforcing that procedural fairness is non-negotiable in duty exemption cases affecting traders and SEZ operators.

CESTAT has ruled that glucometers are instruments for chemical analysis under CTI 9027 80 90, not medical devices under 9018 90 99, making them eligible for nil basic customs duty under Notification 24/2005-Cus. This clarifies a critical classification ambiguity for diagnostic device importers and reinforces the primacy of functional use over product category in tariff interpretation.

Madras High Court ruled that once importers establish prima facie compliance with Notification 32/97, the burden of proving diversion of duty-free goods shifts to the Revenue. The Court upheld confiscation and penalties of Rs. 71.72 lakh, reinforcing that fraudulent intent must be affirmatively proven by customs authorities, not presumed.

CESTAT Chennai rules that the absence of Country of Origin (COO) markings on aluminium scrap does not invalidate preferential duty exemption under the ASEAN-India FTA if all documentary evidence is verified. The Tribunal emphasizes that physical markings are not mandatory for scrap goods, reinforcing the principle of substantial compliance in trade agreements.