Facts of the Case

This is a writ petition before the Telangana High Court arising from a Customs Act enforcement action against SpiceJet Limited and its officials over alleged undervaluation of exported goods and discrepancies relating to a duty benefit scheme. This is a Customs law matter concerning export valuation and the RODTEP (Remission of Duties and Taxes on Exported Products) scheme; the reference to "GST Bhavan" in the respondent's address is only the name of the building housing the Customs office and has no bearing on the substance of the case, which does not involve any GST question.

On scrutiny of export documents filed through the SEZ online system, Customs authorities found that tax invoices issued by M/s UIEPL carried endorsements indicating an intent to claim benefits under the RODTEP scheme, whereas the SEZ system reflected that the exports were filed under duty drawback claims — a discrepancy that triggered a show cause notice dated 01.07.2022. The petitioners contended that this notice was followed by inadequate opportunity to reply and an improper hearing before the Additional Commissioner of Customs passed Order-in-Original No. 184/2022-ADJN-CUS-ADC dated 13.03.2023, holding the goods undervalued, ordering confiscation with a redemption fine of Rs. 5 lakh, and imposing penalties of Rs. 1 crore each under Section 114(iii) of the Customs Act on certain individuals and suppliers, further penalties of Rs. 5 lakh each under Section 114AA on some of them, and a penalty of Rs. 5 lakh each under Section 114(iii) on the petitioners. The petitioners' appeals before the Commissioner (Appeals) were dismissed as time-barred by common order dated 27.03.2024 (the appeals having been filed on 03.10.2023 against an order communicated on 20.03.2023, beyond the 60-day period plus the 30-day condonable extension under Section 128 of the Customs Act), and their further appeals before the CESTAT were also dismissed, the Tribunal holding that the Commissioner (Appeals) had no power to condone delay beyond the statutory period.

Issues Involved

  1. Whether the appellate authorities correctly held that they had no power to condone the delay in filing the Customs appeal beyond the statutory period prescribed under Section 128 of the Customs Act, 1962.
  2. Whether, in the peculiar facts of the case — where the delay was not attributable to deliberate inaction or lack of bona fides and the appeal raised issues never examined on merits — the High Court could exercise its writ jurisdiction under Article 226 to grant relief despite the strict statutory limitation.

Petitioner's Arguments

  • The delay in filing the first appeal, though beyond the statutorily condonable period, was not the result of deliberate inaction or bad faith, and the petitioners had genuinely pursued the appellate remedy, albeit belatedly.
  • The substantive issues concerning the alleged undervaluation and the RODTEP/duty drawback discrepancy had never been examined on merits by any appellate authority, since both the Commissioner (Appeals) and the CESTAT had dismissed the appeals purely on the ground of limitation.
  • Denying an opportunity for merits adjudication would foreclose the petitioners' statutory right of appeal entirely and cause grave injustice.

Respondent's Arguments

  • Section 128 of the Customs Act prescribes a strict limitation period of 60 days, extendable by a further 30 days at the discretion of the Commissioner (Appeals), and the appellate authorities correctly held that they lacked power to condone delay beyond that period, which the petitioners had exceeded.

Court Order / Findings

  • The Court agreed with the settled legal position that Section 128 of the Customs Act is a special statute of limitation, and appellate authorities under it cannot ordinarily condone delay beyond the prescribed period.
  • However, exercising its extraordinary writ jurisdiction under Article 226, and without disturbing the legal position on limitation under the Customs Act itself, the Court found that the delay here was not indicative of deliberate inaction or mala fides, and that denying any opportunity for merits adjudication would work a grave injustice given that the substantive issues had never been examined.
  • The Court set aside the Commissioner (Appeals)'s order dated 27.03.2024 and the consequential CESTAT Final Order dated 21.01.2025 (insofar as they related to Order-in-Original No. 184/2022-ADJN-CUS-ADC), and condoned the delay in filing the first appeal, subject to the petitioners paying Rs. 25,000/- to the Telangana State Legal Services Authority within two weeks.
  • Upon such payment, the appeal was to be restored before the Commissioner (Appeals) and adjudicated afresh on merits after affording both parties a reasonable opportunity, strictly in accordance with law.
  • The writ petition was accordingly partly allowed — the Court granted a fresh opportunity for merits adjudication of the appeal, but did not itself decide the underlying undervaluation/confiscation/penalty dispute.

Important Clarification

This ruling illustrates the High Court's willingness to use its writ jurisdiction, in an appropriate case, to secure a merits hearing of a Customs appeal dismissed purely on limitation grounds — without altering the statutory limitation framework itself, and by imposing a cost condition. It concerns Customs Act confiscation and penalty proceedings tied to export valuation and the RODTEP/duty drawback scheme, and does not decide, or relate to, any question of GST law.

Sections Involved

  • Section 128, Customs Act, 1962 — Appeals to Commissioner (Appeals) and limitation
  • Section 114(iii) and Section 114AA, Customs Act, 1962 — Penalty for attempted improper export and use of false documents
  • Article 226, Constitution of India — Writ jurisdiction

Decision – In Favour of Petitioners

The Telangana High Court partly allowed the writ petition, condoning the delay in the Customs appeal on payment of costs and restoring it for fresh merits adjudication, without itself deciding the underlying undervaluation and penalty dispute, and without engaging with any GST-law question.

Case Details

  • Court: High Court for the State of Telangana at Hyderabad
  • Case No.: Writ Petition No. 27343 of 2025
  • Coram: Hon'ble Sri Justice P. Sam Koshy and Hon'ble Sri Justice Suddala Chalapathi Rao
  • Date of Order: 10 April 2026

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