Setback for HDFC: CESTAT Rules Imported Rectangular Gold Pieces are Not Coins, Concessional Duty Benefit Denied [Read Order]
CESTAT held that HDFC Bank’s imported rectangular gold pieces without engraved serial numbers are bars, not coins, and denied concessional duty benefit under the Notification
HDFC - Taxscan
HDFC - Taxscan
The Hyderabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that rectangular gold pieces imported by HDFC Bank without engraved serial numbers do not qualify as “gold coins” and are to be treated as gold bars, making them ineligible for concessional duty under Notification No. 62/2004-Cus.
HDFC Bank regularly imports gold, including coins, through various ports. Under the notification, gold bars with engraved serial numbers and gold coins attract concessional duty. In 2005 and 2006, HDFC imported rectangular-shaped gold pieces through Hyderabad and claimed the concessional rate.
Customs authorities denied the benefit, treating the goods as bars rather than coins, and HDFC paid a higher duty of Rs. 5,35,500 under protest. Its subsequent refund claim was rejected by the adjudicating authority and upheld on appeal.
The appellant’s counsel argued that the notification created two separate categories: bars, which must carry engraved serial numbers, and coins, which carried no such requirement. They argued that coins need not be circular and pointed out that the concessional rate had been granted at other ports for identical imports.
The revenue counsel countered that the imported goods were rectangular bars of 5 grams, lacking engraved serial numbers, and were even described by the Swiss manufacturer PAMP as ingots.
They argued that exemption notifications must be interpreted strictly and cited the Supreme Court’s decision in Dilip Kumar & Co. to state that ambiguities in such notifications must favor the revenue.
The two-member bench comprising A.K. Jyotishi (Technical Member) and Angad Prasad (Judicial Member) observed that the goods matched the description of small bars or ingots and could not be treated as coins.
The tribunal explained that the requirement of engraved serial numbers was mandatory for bars and the imported pieces did not meet this condition, so they fell under the higher duty category.
The tribunal pointed out that exemptions must be read strictly, and where no ambiguity exists, relief cannot be granted by stretching definitions. The appeal was dismissed.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
