CCTV Cameras’ Exemption Claim under ASEAN-India FTA: Madras HC quashes Customs Order suffers from Natural Justice Violation [Read Order]

The Madras High Court has quashed a Customs order denying duty exemption to CCTV cameras imported, holding that the decision suffered from a clear violation of the principles of natural justice.

The petitioner, M/s Compuage Infocom Ltd had sought exemption from customs duty under Notification No.46/2011-Cus dated 1.6.2011, claiming benefit under the ASEAN-India Free Trade Agreement (FTA) for CCTV cameras and network video recorders imported from Vietnam.

However, the Deputy Commissioner of Customs rejected the claim, relying solely on an earlier ruling of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) which had held against the petitioner in a different classification dispute concerning imports from South Korea.

Before the High Court, the petitioner argued that the impugned order was passed without due consideration of its reply dated 07.05.2021, wherein it had specifically claimed FTA-based exemption supported by a certificate of origin issued in Vietnam.

It was contended that unlike the earlier CESTAT case involving Korean-origin goods with no exemption, the present shipment from Vietnam was squarely covered by the ASEAN-India FTA benefits.

Despite this, the Customs authority failed to examine or address this contention and proceeded to reject the exemption claim, without granting the petitioner an opportunity of personal hearing.

Justice N. Anand Venkatesh noted that the Customs authority was bound to consider all grounds raised by the importer before finalising the assessment. The Court observed that if there was any doubt or need for clarification regarding the certificate of origin, the authority ought to have sought further explanation instead of bypassing the issue altogether. By ignoring the exemption claim and the supporting documents, the order was found to be in violation of natural justice.

Accordingly, the High Court set aside the impugned speaking order dated 19.07.2021 and remanded the matter back to the Deputy Commissioner of Customs for fresh consideration.

The bench directed that the petitioner’s submissions, including the ASEAN-India FTA exemption claim, must be duly examined and an opportunity of hearing provided before passing final orders. The authority was also instructed to conclude the proceedings expeditiously.

Mr. Hari Radhakrishnan appeared for the petitioner and Mr.Rajendran Raghavan Standing Counsel, appeared for the respondent.

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