Court clarifies non-retrospective application of Customs notification, ensuring provisional release subject to conditions
In a significant ruling, the Madras High Court has directed the provisional release of 119 units of imported Digital Multifunction Print, Copying, and Scanning Machines by S.P. Associates, amidst a contentious debate over the retrospective application of a customs notification amendment. The judgment was delivered by Justice Hemant Chandangoudar on August 3, 2026, in the case of S.P. Associates v. Commissioner of Customs.
The petitioner, S.P. Associates, had sought a directive for the provisional release of their imported goods under Section 110A of the Customs Act, 1962. The controversy arose due to an amendment to a notification, which introduced an exemption for Highly Specialised Equipment (HSE). This amendment, effective from June 15, 2026, was argued by the respondents, represented by Junior Panel Counsel Mr. G. Meganathan, as applicable to the petitioner's imports.
The crux of the dispute was the amendment's applicability date. Counsel for the petitioner, Mr. S. Shriram, contended that the amendment could not be applied retrospectively, asserting that the Bill of Entry was filed prior to the amendment's enforcement date. Supporting this stance, the court highlighted the importance of the filing date of the Bill of Entry, dated July 17, 2026, which predates the amendment.
Justice Chandangoudar emphasized that in the absence of an express provision for retrospective application, the amendment could only apply prospectively. Consequently, the court ruled that the Customs authorities could not use the amended notification to deny the provisional release of the goods.
The judgment aligns with previous court rulings, referencing a similar order passed on July 10, 2025, for related cases. The court directed the Customs authorities to consider the petitioner's request for provisional release, subject to conditions in accordance with the law. The provisional release is to be executed within a stipulated timeframe, contingent on compliance with imposed conditions.
Furthermore, the court clarified that the rate of duty applicable to the goods should be independently determined by the adjudicating authority based on the date of filing the Bill of Entry, as per Section 15 of the Customs Act, 1962.
This ruling underscores the judiciary's role in ensuring fair application of amendments, preventing undue retrospective application, and safeguarding importers' rights under the prevailing legal framework.
Bottom Line :
Customs Act - Provisional release of imported goods under Section 110A - Amendment to notification cannot be applied retrospectively unless expressly provided - Relevant date for determining applicability of amendment is the date of filing of Bill of Entry under Section 15 of Customs Act.
Statutory provision(s):
Customs Act, 1962 Sections 15, 110A
S.P.Associates v. Commissioner Of Customs, (Madras) : Law Finder Doc id # 2962610
